New York: Goldman Sachs reported a jump in second-quarter earnings Tuesday due in large part to strong activity in merger and acquisitions and other corporate transactions.
Net profits came in at $2.3 billion (Dh8.4 billion), up 44 per cent from the year-ago period. Revenues rose 19 per cent to $9.4 billion.
The results easily topped Wall Street analyst expectations.
Areas of strength included advisory services connected to an industrywide uptick in merger and acquisitions advisory services and much higher equity underwriting revenues due to a surge in initial public offerings.
The investment bank also announced a succession plan on Tuesday, with president David Solomon taking over for longtime chief executive Lloyd Blankfein, implementing a much-telegraphed succession plan as it expands beyond its Wall Street roots to the broader consumer market.
The bank said Solomon will assume the top executive job on October 1, while Blankfein will remain as chairman through the end of the year. Solomon will then succeed Blankfein as chairman.
Goldman Sachs further said its backlog on additional transactions was “significantly higher” than in the first quarter.
Revenues in Goldman’s trading businesses also grew thanks to a jump in trading for fixed income, currency and commodities.
Trading revenues in equities was essentially flat, with Goldman citing lower volatility compared with the heady first quarter of 2018.
Goldman Sachs also reported gains in revenues for its investing and lending and investment management businesses.
“Solid performance across all of our major businesses drove the strongest first-half returns in nine years,” said Blankfein.
“With a healthy economic backdrop and deep client franchises, the firm is well-positioned to invest in attractive opportunities to meet the needs of our clients and continue to generate earnings growth.”
Shares of Goldman Sachs dipped 0.7 per cent to $229.50 in pre-market trading.
