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Goldman Sachs Reports Earnings Per Common Share Of $14.13 For 2012

Net revenues in Equities were $2.30 billion for the fourth quarter of 2012, 36% higher than the fourth quarter of 2011, reflecting significantly higher net revenues in securities services and equities client execution. The increase in securities services net revenues compared with the fourth quarter of 2011 reflected a gain of approximately $500 million on the sale of the firm’s hedge fund administration business. The increase in equities client execution net revenues compared with the fourth quarter of 2011 reflected significantly higher net revenues in derivatives and higher net revenues in reinsurance. These increases were partially offset by lower commissions and fees, reflecting lower market volumes. During the quarter, Equities operated in an environment generally characterized by low volatility levels and an increase in equity prices in Asia and Europe.

The net loss attributable to the impact of changes in the firm’s own credit spreads on borrowings for which the fair value option was elected was $126 million ($79 million and $47 million related to Fixed Income, Currency and Commodities Client Execution and equities client execution, respectively) for the fourth quarter of 2012. The net gain attributable to the impact of changes in the firm’s own credit spreads on borrowings for which the fair value option was elected was $20 million (all related to equities client execution) for the fourth quarter of 2011.

Investing & Lending

Full YearNet revenues in Investing & Lending were $5.89 billion for 2012. Investing & Lending net revenues were positively impacted by tighter credit spreads and an increase in global equity prices. Results for 2012 included a gain of $408 million from the firm’s investment in the ordinary shares of Industrial and Commercial Bank of China Limited (ICBC), net gains of $2.39 billion from other investments in equities, primarily in private equities, net gains and net interest income of $1.85 billion from debt securities and loans, and other net revenues of $1.24 billion, principally related to the firm’s consolidated investment entities.

Fourth QuarterNet revenues in Investing & Lending were $1.97 billion for the fourth quarter of 2012. Investing & Lending net revenues were positively impacted by generally tighter credit spreads and an increase in equity prices in Asia and Europe. Results for the fourth quarter of 2012 included a gain of $334 million from the firm’s investment in the ordinary shares of ICBC, net gains of $789 million from other investments in equities, primarily in private equities, net gains and net interest income of $485 million from debt securities and loans, and other net revenues of $365 million, principally related to the firm’s consolidated investment entities.

Investment Management

Full YearNet revenues in Investment Management were $5.22 billion for 2012, 4% higher than 2011, due to significantly higher incentive fees, partially offset by lower transaction revenues and slightly lower management and other fees. During the year, assets under supervision  (9) increased $70 billion to $965 billion. Assets under management increased $26 billion to $854 billion, reflecting net market appreciation of $44 billion, primarily in fixed income and equity assets, partially offset by net outflows of $18 billion. Net outflows included outflows in equity, alternative investment and money market assets, partially offset by inflows in fixed income assets  (10). Other client assets increased $44 billion to $111 billion, primarily due to net inflows  (10).

Fourth QuarterNet revenues in Investment Management were $1.52 billion for the fourth quarter of 2012, 20% higher than the fourth quarter of 2011 and 26% higher than the third quarter of 2012. The increase in net revenues compared with the fourth quarter of 2011 was primarily due to significantly higher incentive fees and higher management and other fees. During the quarter, assets under supervision increased $14 billion to $965 billion. Assets under management decreased $2 billion to $854 billion, reflecting net outflows of $7 billion  (10), partially offset by net market appreciation of $5 billion. Net outflows included outflows in fixed income, equity and alternative investment assets, partially offset by inflows in money market assets. Other client assets increased $16 billion to $111 billion, primarily due to net inflows.

Expenses

Operating expenses were $22.96 billion for 2012, essentially unchanged compared with 2011.

Stock quotes in this article: GS 

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