Goldman Sachs Q3 profits jump 94% to $3.5 bn despite pandemic
GOLDMAN Sachs reported strong third-quarter results on Wednesday, nearly doubling profits and re ecting little of the vulnerability that has plagued corners of the real economy during the pandemic.
Key strengths to the money machine at Wall Street’s iconic investment bank included a significant increase in initial public offerings and a surge in revenues from its markets division.
Trading has generally been a strength for large banks during the pandemic, boosting commission fees as markets have swerved. Volatility declined modestly in the third quarter, Goldman said.
Net income came in at 3. billion, up 9 percent from the year-ago period and topping analyst estimates by a wide margin. Revenues rose 30 percent to 10.8 billion.
Goldman set aside 278 million for credit losses, well below the 1.6 billion it allotted for bad loans in the prior quarter that encompassed the most severe Covid-19 restrictions.
Reports from large banks in the third quarter have shown much lower reserves for bad loans compared with the last two quarters, when large financial companies set aside huge piles of cash in case of defaults.
Goldman’s revenue rose in all four divisions compared with the year-ago period. Revenues from equity investments soared 139 percent from the year-ago period, re ecting an ascendant stock market during the period.
Our ability to service clients who are navigating a very uncertain environment drove strong performance across the franchise, said Goldman Chief Executive David Solomon. As our clients begin to emerge from the tough economy brought on by the pandemic, we re well positioned ot help them recover and grow.
Shares of Goldman rose 2.6 percent to 216.2 in pre-market trading.