Revenues Slip At Goldman Sachs In Q3; Investment Revenues Edge Higher

Eliane Chavagnon

17 October 2013

has today reported that net revenues from investment management totaled $1.22 billion at end-September 2013, up by 2 per cent year-on-year but down by 9 per cent since this year’s second quarter.

The 2 per cent increase in investment management net revenues reflected higher management and other fees, due mainly to elevated average assets under supervision. The firm also cited “favorable changes in the mix of assets under supervision, partially offset by lower transaction revenues.”

For the group as a whole, Goldman Sachs logged net revenues of $6.72 billion, down from $8.6 billion, or 22 per cent, and $8.5 billion, or 20 per cent, on the previous quarter and a year ago respectively.

“The third quarter’s results reflected a period of slow client activity,” said Lloyd Blankfein, chairman and chief executive.

The New York-listed firm also reported in its latest earnings release net earnings of $1.52 billion for the third quarter ended September 30, 2013, down 21 per cent from the $1.9 billion recorded at end-June and basically unchanged from $1.5 billion in the same period a year ago.

Total operating expenses were $4.56 billion, 25 per cent lower than in Q3 2012, and 24 per cent lower than the some $6.1 billion logged in the previous quarter.

Referring back to investment management, Goldman Sachs said total assets under supervision increased $36 billion to $991 billion during the quarter, while long-term assets under supervision rose $35 billion. This, the firm said, reflects market appreciation of $19 billion, primarily in equity assets, and net inflows of $16 billion, primarily in fixed income assets.

“Still, we saw various signs that our clients are prepared to act on significant transactions and we believe that the firm is well positioned to help our clients accomplish their objectives. As longer term US budget issues are resolved, we could see an improvement in corporate and investor sentiment that would help lay the basis for a more sustained recovery,” Blankfein added.

In this year's second quarter, Goldman Sachs reported total net revenues of $8.61 billion, down 15 per cent from $10.09 billion in the first quarter, but up 30 per cent year-on-year.