Goldman Sachs Group Inc. (NYSE: GS) has managed to absolutely crush its earnings expectations for the fourth quarter of 2013. The bulge bracket broker, or the bank holding company without a bank operation, reported that fourth-quarter earnings came in at $2.33 billion, or $4.60 per common share, on net revenues of $8.78 billion. Thomson Reuters had estimates of $4.21 in earnings per share and $7.71 billion in revenue. This also compares to results from a year ago of $5.60 per share and $9.24 billion in revenue.
Goldman Sachs is attributing its client franchise and continued cost discipline in its strength. Highlights in the quarter were as follows:
- Net revenues in Institutional Client Services were $3.41 billion, 22% lower than the fourth quarter of 2012 and 19% higher than the third quarter of 2013.
- Net revenues in Fixed Income, Currency and Commodities Client Execution were $1.72 billion, 15% lower than the fourth quarter of 2012, due to significantly lower net revenues in mortgages and interest rate products, currencies and commodities.
- Net revenues in credit products (including a gain on the sale of European insurance business) were higher compared with the fourth quarter of 2012.
- Net revenues in equities were down 27% to $1.68 billion due to the sale of the Americas reinsurance business and due to the sale of the firm’s hedge fund administration business.
- Net revenues in Investing & Lending were $2.06 billion for the fourth quarter of 2013, 4% higher than the fourth quarter of 2012 and 40% higher than the third quarter of 2013.
- Net revenues in Investment Management were $1.60 billion for the fourth quarter of 2013, 5% higher than the fourth quarter of 2012 and 31% higher than the third quarter of 2013.
For the year, operating expenses and compensation were mixed. Operating expenses were $22.47 billion for 2013, 2% lower than 2012. Compensation and benefits expenses were down 3% in 2013 to $12.61 billion. The compensation and benefits ratio to net revenues for 2013 was 36.9%, down from 37.9% for 2012. Goldman Sachs also said that its total staff increased 2% compared with the end of 2012.
The firm also reported that its Tier 1 capital ratio was 16.7% (up from 16.3% in September) and the Tier 1 common ratio was 14.6% (up from 14.2% in September).
Credit Card Companies Are Doing Something Nuts
Credit card companies are at war. The biggest issuers are handing out free rewards and benefits to win the best customers.
It’s possible to find cards paying unlimited 1.5%, 2%, and even more today. That’s free money for qualified borrowers, and the type of thing that would be crazy to pass up. Those rewards can add up to thousands of dollars every year in free money, and include other benefits as well.
We’ve assembled some of the best credit cards for users today. Don’t miss these offers because they won’t be this good forever.
Flywheel Publishing has partnered with CardRatings for our coverage of credit card products. Flywheel Publishing and CardRatings may receive a commission from card issuers.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Latest from 24/7
