Goldman Sachs sees profits fall by more than 80%

21 July 2010

Profits at Goldman Sachs fell by 82 per cent during the second quarter of 2010 when compared with the same period last year.

Official statistics from the investment bank revealed that profits dropped to $613 million or the equivalent of $0.78 per share.

The figures were down on the $3.44 billion or $4.93 per share recorded during the same quarter the previous year.

Lloyd Blankfein, Goldman Sach’s chairman and chief executive officer, said: “The market environment became more difficult during the second quarter and, as a result, client activity, across our business declined.”

“Looking ahead, we remain focused on helping our clients to raise capital, manage risk and invest for the future, which are all important to economic growth.”

The results showed that revenue of $8.84 billion for the period was also lower than the $13.76 billion seen during the same three months last year.

Goldman Sachs also paid $600 million to adhere to the UK’s bank bonus tax rules and an additional $550 million to the Securities and Exchange Commission (SEC).

However, earnings per share would have reached $2.75 if these costs were excluded, more than 40 per cent lower than the $4.93 seen last year.

The investment bank paid the SEC the figure to settle claims it had misled investors over a product related to subprime mortgage securities.

By Jim Ottewill

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