Goldman Sachs overhauls banking and trading units, reports profit (UPDATED)
Thursday, July 14, 2014
Goldman Sachs reported a net income of $14.4 billion, or 97 cents a share, in the three months ended June 30, 2014. The firm’s revenue of $33.3 billion reached $32.9 billion from $32.2 billion in the prior year period, an increase of 2.7%. Average trading revenue reached $631.7 million, a 3.2% increase from the prior year. Goldman Sachs’ fourth quarter was negatively impacted by the weak first quarter performance of its trading business, which was affected negatively by a $3.8 billion charge related to its U.S. exchange and clearing operations in Europe, which had a negative impact on the firm’s revenue from the European equities segment. Goldman Sachs’ fourth quarter also included a $9.4 billion reduction in its deferred tax liability for the current year, while its deferred tax liability for 2013 was reduced by $4.8 billion.
Net cash payables in the fourth quarter totaled $20.7 billion, an increase of $4.4 billion from the prior year period. Total cash and cash equivalents at June 30, 2014 amounted to $20.7 billion and $12.2 billion, respectively.
At June 30, 2014, the stock market value of Goldman Sachs’ equity portfolio was $307.0 billion, including the investment in Barclays PLC and its $20.0 billion shares in Barclays Capital; the amount of its equity portfolio as a percentage of its total assets at June 30 was 49.6%, higher than the 50.1% level for the second quarter of 2014.
Net revenue from the U.S. equities segment of Goldman Sachs for the quarter ended June 30, 2014 totaled $32.8 billion, a 3.2% increase from the prior year period and a 10.2% increase over the fourth quarter of 2013. The revenue increase in the U.S. equities segment was due to the positive impact in the U.S