Goldman Sachs Group Inc’s trading operations helped the dominant Wall Street firm quadruple its earnings, but investment banking results were not as exciting and its shares sold off a bit on the report. Goldman’s compensation packages have drawn some scrutiny, but stayed on to hand out more than US$20B in Y 2009 bonuses, the equivalent to more than US$630,000 per employee and is likely beat a record set for compensation in 2007. The report noted that Goldman’s investment banking and asset management revenues were lower. The bank fell to No. 2, behind Morgan Stanley, in M&A adviser rankings for deals announced globally through Q-3 according to Thomson Reuters. Goldie also dropped a spot to No. 7 in global capital markets. Fixed income, currency and commodities (FICC) trading nearly quadrupled, helping propel overall revenue to a forecast beating US$12.37B. However, the US$5.99B in FICC revenue, driven by credit products and mortgages, lagged Q-2 and fell short of some analysts’ high expectations.
“While it is difficult to call $6 bln in FICC trading a miss, we suspect the recent run-up in GS shares reflected expectations for a stronger trading revenue number,” analyst Jeff Harte of Sandler O’Neill wrote in a research note.
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