Financial services firm Goldman Sachs Group, Inc. (GS) Thursday reported a profit for the fourth-quarter, compared to a loss in the previous year, helped by a surge in revenues especially at its investment banking as well as trading and principal investments operations. Further, the company said it reduced its compensation by 20% from 2007.
Fourth-quarter net earnings were $4.95 billion. Net earnings applicable to common shareholders were $4.787 billion. On a per hare basis, earnings for the quarter was $8.20 per share.
In the fourth quarter ended November 28, 2008, the company reported a net loss of $2.121 billion. Net loss applicable to common shareholders was $2.287 billion. Loss per share for the period was $4.97.
On average, 23 analysts polled by Thomson Reuters expected the company to earn $5.20 per share for the quarter. Analysts' estimates typically exclude special items.
Net revenues in the just concluded quarter were $9.615 billion, compared to negative revenues of $1.578 billion in the fourth quarter of 2008. Analysts were looking for revenues of $9.65 billion.
Investment banking revenues in the latest quarter was $1.635 billion, compared to $1.034 billion last year. Net revenues in Financial Advisory were $673 million, up 17% from the fourth quarter of 2008, reflecting an increase in client activity. Net revenues in Underwriting business more than doubled from last year to $962 million, reflecting significantly higher net revenues in equity and debt underwriting.
Trading and principal investments generated $5.050 billion in the just concluded quarter, compared to negative revenues of $4.461 billion from the segment last year. Net revenues in FICC were $3.97 billion compared with negative net revenues of $3.40 billion for the fourth quarter of 2008, due to better results in credit products and mortgages. Net revenues in Equities dropped 27% to $1.93 billion from last year.
In Asset management and securities services, quarterly revenues were $1.162 billion, in comparison with last year's $936 million. Net interest income was $1.768 billion, compared to $913 million last year.
The company's pre-tax earnings for the quarter were $7.377 billion, compared to a pre-tax loss of $3.599 billion last year.
For the year ended December 31, 2009, net earnings were $13.39 billion and net earnings applicable to common shareholders were $12.192 billion. Earnings per common share for the year was $22.13.
In 2008, net earnings were $2.322 billion and net earnings applicable to common shareholders were $2.041 billion. Earnings per common share for the year was $4.47. Net revenues for the year were $45.173 billion, compared to $22.222 billion last year.
Analysts expected 2009 earnings of $18.93 per share on revenues of $45.29 billion.
Return on average common shareholders' equity was 22.5% for 2009.
Additionally, the company said its compensation and benefits in 2009 were down by $4 billion or 20% from 2007 at $16.19 billion. In 2008, compensation and benefits were $10.934 billion. In the fourth quarter, compensation previously accrued was reduced to fund a charitable contribution of $500 million to Goldman Sachs Gives, the firm's donor-advised fund. The firm's 35.8% ratio of compensation and benefits to net revenues was its lowest as a public company, Goldman Sachs said.
Further, the company's Board of Directors declared a dividend of $0.35 per common share to be paid on March 30 to common shareholders of record on March 2.
While commenting on the results, Lloyd Blankfein, chairman and chief executive officer of the company, said, "Despite significant economic headwinds, we are seeing signs of growth and remain focused on supporting that growth by helping companies raise capital and manage their risks, by providing liquidity to markets and by investing for our clients."
For the third quarter of fiscal 2009, the company's net earnings applicable to common shareholders was $3.03 billion, or $5.25 per share. Quarterly net revenues were $12.37 billion.
Among peers, Morgan Stanley said Wednesday that fourth-quarter net income applicable to Morgan Stanley was $617 million, or $0.29 per share, compared to a net loss applicable to Morgan Stanley of $10.953 billion or $11.35 per share in the fourth quarter of last year. Consolidated net revenues for the quarter were $6.842 billion, compared to negative revenues of $13 billion last year.
Bank of America Corp. (BAC) Wednesday reported a fourth-quarter net loss of $194 million, narrower than a net loss of $1.79 billion reported in the same period a year earlier. Loss applicable to common shareholders was $5.2 billion or $0.60 per share, compared to a net loss of $2.39 billion or $0.48 per share, in the year-ago quarter. Revenue increased to $25.08 billion from $15.68 billion a year ago.
JPMorgan Chase & Co. (JPM) last week reported a four-fold rise in fourth-quarter profit, reflecting strong results from its Investment Bank and Asset Management businesses. The company's fourth-quarter net income jumped to $3.28 billion or $0.74 per share from $702 million or $0.06 per share reported a year ago. Total quarterly net revenues rose 34% to $23.16 billion from $17.23 billion in the prior-year quarter.
GS is currently trading at $164.65, down $3.09 or 1.78%, on 13.45 million shares.
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June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.