Updated from 8:11 a.m. ET to include CFO comments about Volcker Rule and afternoon share prices.
NEW YORK (TheStreet) -- Goldman Sachs (GS) beat fourth quarter earnings on a recovery in the bank's fixed income sales and trading revenue, growth at its investment bank and higher marks to its near-$60 billion portfolio of alternative assets.
The earnings indicate that Goldman Sachs was able to take advantage of recovering confidence in capital markets and corporate C-Suites. However, they also continued to point to the bank's reliance on earnings from businesses that may become constrained by regulations.
The nation's largest independent investment bank said on Thursday it earned $4.60 in fourth quarter earnings per share on revenue of $8.78 billion, significantly beating Wall Street consensus estimates of $4.18 a share on $7.75 billion in revenue. Credit Suisse and Keefe Bruyette & Woods both forecast Goldman's fourth quarter EPS at $4.40 a share, in January reports.
The firm saw positive trends across its most important businesses in the fourth quarter, including strong performance at its investment bank and slightly better-than-forecast equity and fixed income sales and trading.
Goldman Sachs investment banking unit capitalized on recovering confidence among its corporate clients, helping to drive $1.72 billion in the fourth quarter net revenue, ahead of most estimates, and 47% higher than year-ago levels.
KBW analyst Fred Cannon forecast Goldman to generate $1.72 billion in investment banking revenue on particularly strong equity underwriting and M&A advisory performance. Overall, the unit's $6 billion in sales reflected 22% growth through 2013, the representing the best revenue growth across the firm.
Goldman Sachs CFO Harvey Schwartz attributed strong investment banking results to a robust IPO calendar, higher M&A volumes and continued strength in debt financing.