Goldman's profit doubles, helped by underwriting - FOX 13 News

Goldman's profit doubles, helped by underwriting

Posted: Updated:

By CHRISTINA REXRODE
AP Business Writer
   NEW YORK (AP) -- Goldman Sachs says its second-quarter profit doubled, boosted by a surge in stock and bond underwriting.
 
   Profit was $1.9 billion after payments to preferred shareholders, compared with $927 million a year ago.
 
   Per share, those profits were $3.70. Analysts polled by FactSet had expected $2.83.
 
   Revenue was $8.6 billion, up 30 percent from $6.6 billion a year ago. That also beat the expectations of analysts, who had forecast $8 billion.
 
   In a statement, CEO Lloyd Blankfein called the quarter "solid," especially considering the "mixed economic sentiment."
 
   Blankfein described the U.S. economy as improving, but said that Goldman would "continue to put a premium on disciplined risk management."
 
   One way that Goldman makes money is from trading on behalf of institutional clients like pension funds and hedge funds. Revenue from the unit that trades on behalf of clients was up 11 percent.
 
   Goldman said that market conditions became "more challenging" during the latter part of the second quarter "as interest rates and market volatility increased."
 
   The stock market zig-zagged and bond prices fell in late May and through most of June because investors were trying to guess how long the Federal Reserve will continue its economic stimulus program. Goldman's revenue from trading mortgages and interest-rate products fell, though higher stock market values and increased activity in Asia helped the bank's stock-trading business.
 
   Even with the fitful quarter, conditions were still calmer than in the year-ago period, when worries about Europe's debt woes were much more acute and Washington was deadlocked over budget issues. Besides, many investors see volatility as a reason to get into markets because there are more opportunities to trade.
 
   The biggest increase in Goldman's earnings came from underwriting stocks and bonds, where revenue soared 45 percent.  
 
   The bank said it set aside more money for potential lawsuits and regulatory proceedings, but didn't give details. A former Goldman Sachs trader, Fabrice Tourre, went to trial Monday in New York, accused of selling mortgage-backed securities that he knew were going to fail. Goldman already settled related charged with the Securities and Exchange Commission in 2010, though it still faces private lawsuits.
 
   Goldman's stock rose $1.52, or 1 percent, in pre-market trading to $164.52.

  • Your MoneyMore>>

  • Teens want back-to-school gadgets, not clothes

    Teens want back-to-school gadgets, not clothes

    Thursday, August 28 2014 9:52 PM EDT2014-08-29 01:52:52 GMT
    For many students, school starts next week. So what will your teens be asking you to buy? Technology.That's right: they are willing to wear last year's clothes and instead spend money on the latest tech. Gone are the days of securing your status in high school with the right clothes. Now your teens need to own the newest tablet or smart phone and its accessories.
    For many students, school starts next week. So what will your teens be asking you to buy? Technology.That's right: they are willing to wear last year's clothes and instead spend money on the latest tech. Gone are the days of securing your status in high school with the right clothes. Now your teens need to own the newest tablet or smart phone and its accessories.
  • Conference call: your bathroom break

    Conference call: your bathroom break

    We asked several people what they do when they are on a conference call. Most of them answered: "The bathroom." Yes, according to a survey conducted by InterCall, 47 percent of 500 people admitted to taking a conference call from the bathroom.
    We asked several people what they do when they are on a conference call. Most of them answered: "The bathroom." Yes, according to a survey conducted by InterCall, 47 percent of 500 people admitted to taking a conference call from the bathroom.
  • Monitoring your kids' driving in real time

    Monitoring your kids' driving in real time

    Wednesday, August 27 2014 10:46 PM EDT2014-08-28 02:46:07 GMT
    Many new Ford and GM cars have built-in technology that allows you to monitor speed, signaling, and navigation when your child is driving. But when it comes to this type of digital snooping, teens and their parents often have differing opinions. Kids may call it an invasion of privacy. Most parents, of course, will likely feel otherwise.
    Many new Ford and GM cars have built-in technology that allows you to monitor speed, signaling, and navigation when your child is driving. But when it comes to this type of digital snooping, teens and their parents often have differing opinions. Kids may call it an invasion of privacy. Most parents, of course, will likely feel otherwise.
Powered by WorldNow

FOX 13 / WTVT-TV
3213 West Kennedy Blvd.
Tampa, Florida 33609
Main: (813) 876-1313
Newsroom: (813) 870-9630
Fax: (813) 871-3135

Didn't find what you were looking for?
All content © Copyright 2000 - 2014 Fox Television Stations, Inc. and Worldnow. All Rights Reserved.
Privacy Policy | New Terms of Service What's new | Ad Choices