NEW YORK: Goldman Sachs Group Inc yesterday posted its best quarterly performance in a decade by some measures, as trading has moved back into the limelight and its lack of a big consumer business has switched from a curse to a blessing.
The Wall Street bank posted a quarterly return on equity of 17.5 per cent, its highest since 2010. Investors closely track that figure because it shows how well a bank uses shareholder money to produce profits.
Goldman also boasted record earnings per share, beating analyst expectations by a wide margin. Its performance was driven in large part by a 29pc jump in trading revenue, as clients responded to news about the coronavirus pandemic by shifting their portfolios.
While rivals including JPMorgan Chase & Co have also benefited from the markets boom this year, they are far more exposed to vulnerable consumers and businesses suffering from unemployment and pandemic lockdowns.
Goldman’s shares rose 0.6pc in early trading as shares of other big lenders fell.
In the years leading up to the pandemic, Goldman’s heavy exposure to trading and lack of exposure to traditional lending was viewed as a problem. The bank is in the middle of a business-model revamp orchestrated by chief executive David Solomon.