Investment bank Goldman Sachs on Thursday reported a 20.6 percent decline in quarterly earnings, as elevated litigation expenses offset higher underwriting revenues from public offerings.
Fourth-quarter earnings came in at $2.2 billion on revenues of $8.8 billion, compared with earnings of $2.8 billion on revenues of $9.2 billion in the year-ago period.
Those results translated into per-share earnings of $4.60, well above analyst estimates for $4.21.
"Our work in advancing our client franchise and in ensuring continued cost discipline has allowed us to provide solid returns even in a somewhat challenging environment," said Goldman chief executive Lloyd Blankfein.
"We believe that we are well positioned to generate solid returns as the economy continues to heal."
Goldman Sachs profits were hit by a 6.2 percent increase in operating expenses, which included provisions for litigation and regulatory proceedings of $561 million compared with $260 million a year ago.
The higher legal costs come as large banks confront a tougher regulatory climate after the financial crisis.
Goldman's results were also adversely affected on a comparative basis with a sale last year of the firm's hedge fund administration business, which added a $494 million gain to the 2012 quarter.
Goldman said its financial advisory revenues rose 15 percent to $585 million, with a strong gain in equity underwriting due to significant work in initial public offerings. But net revenues in debt underwriting fell because of a drop in investment-grade activity.
Goldman Sachs said its 2013 earnings of $7.7 billion rose 6 percent from 2012.
Investment bank Goldman Sachs on Thursday reported a 20.6 percent decline in quarterly earnings, as elevated litigation expenses offset higher underwriting revenues from public offerings.
Fourth-quarter earnings came in at $2.2 billion on revenues of $8.8 billion, compared with earnings of $2.8 billion on revenues of $9.2 billion in the year-ago period.
Those results translated into per-share earnings of $4.60, well above analyst estimates for $4.21.
“Our work in advancing our client franchise and in ensuring continued cost discipline has allowed us to provide solid returns even in a somewhat challenging environment,” said Goldman chief executive Lloyd Blankfein.
“We believe that we are well positioned to generate solid returns as the economy continues to heal.”
Goldman Sachs profits were hit by a 6.2 percent increase in operating expenses, which included provisions for litigation and regulatory proceedings of $561 million compared with $260 million a year ago.
The higher legal costs come as large banks confront a tougher regulatory climate after the financial crisis.
Goldman’s results were also adversely affected on a comparative basis with a sale last year of the firm’s hedge fund administration business, which added a $494 million gain to the 2012 quarter.
Goldman said its financial advisory revenues rose 15 percent to $585 million, with a strong gain in equity underwriting due to significant work in initial public offerings. But net revenues in debt underwriting fell because of a drop in investment-grade activity.
Goldman Sachs said its 2013 earnings of $7.7 billion rose 6 percent from 2012.
