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In this Tuesday, Jan. 15, 2013, photo, the lights are on at Goldman Sachs" headquarters, in New York.
In this Tuesday, Jan. 15, 2013, photo, the lights are on at Goldman Sachs" headquarters, in New York.
(Mark Lennihan/AP)

FINANCIAL TIMES

Goldman Sachs not immune to bank woes

Lex is a premium daily commentary service from the Financial Times. It helps readers make better investment decisions by highlighting key emerging risks and opportunities.

First, the good news. Goldman Sachs Group Inc.’s first-quarter earnings beat analysts’ expectations – comfortably. Total net revenues were up 1 per cent year on year at about $10-billion (U.S.), but ahead of predictions for $9.7-billion, while earnings per share rose 9 per cent to $4.29 versus an anticipated $3.90. Investment banking revenues were up by a third (a better increase than both JPMorgan and Citigroup had in investment banking over the period) as debt and equity underwriting jumped by 63 per cent versus a year ago. The odd punt also paid off. Goldman’s investing and lending segment, which was cordoned off in 2011 to house long-term loans and investments which Goldman believes will be permissible under the Volcker rule, jumped 8 per cent to $2-billion, the second biggest contributor to revenue. And, the ratio of revenues paid to staff dropped from 44 per cent in the first quarter of 2012 to 43 per cent.