Goldman Sachs Group Inc. posted sharply higher earnings for the fourth quarter, underlining a turbulent year in which the Wall Street firm benefited from the markets’ rapid recovery from the worst pandemic recession.
Goldman reported quarterly earnings of $ 4.51 billion, or $ 12.08 a share, on Tuesday, more than doubling from the same quarter a year ago. Revenue of $ 11.74 billion was 18% above the level of the fourth quarter of 2019. Both measures far exceeded the expectations of FactSet analysts, who predicted earnings of $ 7.39 per share on revenue of $ 9.99 billion.
Goldman’s annual revenue of $ 44.56 billion was its highest since 2009, while annual trading revenues hit a 10-year high.
2020 was a roller coaster year for the US banking industry. Markets plummeted and economic activity plummeted in the spring as the coronavirus spread across the country. With many businesses closed and many consumers out of work, banks girded themselves up for widespread defaults. A robust federal spending program helped prevent the worst-case scenario, and last week bank executives indicated in earnings reports that the economy has held up better than expected.
On Friday, JPMorgan Chase & Co. that fourth-quarter earnings rose 42% to a record $ 12.14 billion after the bank released $ 2.9 billion from the stock of funds previously set aside to cover soured loans. On Tuesday, Bank of America Corp. that profit fell 22%, but exceeded analyst expectations after it released $ 828 million from its credit loss reserves.