Goldman's profit doubles, helped by underwriting - KMSP-TV

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>>

  • Business is good at Coney Island

    Business is good at Coney Island

    Friday, August 29 2014 10:22 PM EDT2014-08-30 02:22:32 GMT
    From the brand-new Thunderbolt roller coaster to the world-famous boardwalk, tourists and business owners alike say Coney Island had a great ride of its own this summer. Toms Coney Island's general manager Vasilios Tourlokas says the mild summer impacted his boardwalk business in the best way possible: a 10 to 15 percent increase.
    From the brand-new Thunderbolt roller coaster to the world-famous boardwalk, tourists and business owners alike say Coney Island had a great ride of its own this summer. Toms Coney Island's general manager Vasilios Tourlokas says the mild summer impacted his boardwalk business in the best way possible: a 10 to 15 percent increase.
  • NYC Denny's features $300 breakfast

    NYC Denny's features $300 breakfast

    Friday, August 29 2014 4:04 PM EDT2014-08-29 20:04:13 GMT
    Diner chain Denny's is opening it's first New York City location, complete with a big-city "deal".   How does a $300 breakfast sound?    The Denny's is located at the corner of Nassau and Spruce in Lower Manhattan's Financial District.  Along with its normal food you can get at just about any location in the rest of the country, this location will offer a Grand Slam breakfast with a bottle of 2003 Dom Perignon champagne.
    Diner chain Denny's is opening it's first New York City location, complete with a big-city "deal".   How does a $300 breakfast sound?    The Denny's is located at the corner of Nassau and Spruce in Lower Manhattan's Financial District.  Along with its normal food you can get at just about any location in the rest of the country, this location will offer a Grand Slam breakfast with a bottle of 2003 Dom Perignon champagne.
  • Some Showboat workers get new jobs within company

    Some Showboat workers get new jobs within company

    Friday, August 29 2014 2:54 PM EDT2014-08-29 18:54:36 GMT
    More than 470 of the 2,000-plus workers at Atlantic City's Showboat Casino Hotel have found new jobs with other casinos owned by its parent company. The Showboat is shutting down Sunday afternoon after 27 years on the Boardwalk.
    More than 470 of the 2,000-plus workers at Atlantic City's Showboat Casino Hotel have found new jobs with other casinos owned by its parent company. The Showboat is shutting down Sunday afternoon after 27 years on the Boardwalk.
Powered by WorldNow

KMSP-TV
11358 Viking Drive
Eden Prairie, MN 55344

Phone: (952) 944-9999
Fax: (952) 942-0455

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