Goldman Sachs makes significantly less profit

Dhe win the US money house Goldman Sachs collapsed at the end of the year despite a flourishing trading division. According to its own statements on Tuesday, the financial group earned a bottom line of 1.3 billion dollars (1.2 billion euros) in the three months to the end of December, 66 percent less than a year ago. Losses in retail banking and higher allowances for loans that could default in an economic crisis weighed on the balance sheet. The stock initially fell by around 2 percent before the market.

Goldman Sachs suffered in the fourth quarter from lower wealth management revenues and a slump in investment banking, which includes assisting companies with IPOs and mergers and acquisitions. One bright spot was trading in bonds, commodities and currencies. There were significant gains here as many investors adjusted their portfolios in the face of inflationary and recessionary risks. Overall, however, group-wide revenues fell by 16 percent to $10.6 billion in the fourth quarter.

$11.3 billion profit in 2022

In the entire past fiscal year 2022, net profit collapsed by 48 percent to $ 11.3 billion. Earnings fell 20 percent to $47.4 billion. CEO David Solomon spoke of a “challenging economic environment” when presenting the results. Goldman Sachs now wants to focus on a strategic realignment to strengthen its core business. According to US media reports, around 3,200 jobs are to be cut as part of a savings plan. However, the company has not yet officially confirmed this figure.

Already on Friday, Goldman Sachs disclosed billions in losses in its new private customer division “Platform Solutions” in a mandatory disclosure. The attempt by the Wall Street house, which traditionally specializes in wealthy customers, to attack the mass market with savings accounts and a credit card launched together with the iPhone manufacturer Apple, had not gone as hoped in recent years. After this excursion, Goldman Sachs apparently wants to go back to its roots as an exclusive bank for wealthy clients.

Also MorganStanley suffered a slump in profits at the end of the year. Net income attributable to shareholders fell 41 percent year-on-year to $2.1 billion, Morgan Stanley said on Tuesday in New York. Overall, earnings fell 12 percent to $12.7 billion. The balance sheet suffered from a slump in investment banking – IPOs, mergers and acquisitions remained rare due to the difficult market environment. However, Morgan Stanley posted strong growth in the trading division – many investors had their portfolios changed in view of the risks of inflation and recession. Overall, the quarterly figures were better than expected. The stock gained about 2 percent premarket.

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