Goldman Sachs Group Inc reported on Tuesday that it recorded a 70% drop in net income in its third business quarter of this year, influenced by one of the worst crises in the history of the financial services market.
The largest American investment bank reported that in the quarter ending August 29, it achieved $845 million in net income, or $1.81 per share, compared to $2.85 billion, or $6.13 per share, earned a year earlier. Net revenues were halved to $6.04 billion, down from $12.3 billion in the same period last year.
“The quarter was fraught with challenges, due to a significant weakening of client activity and a decline in asset values,” said Lloyd Blankfein, CEO of Goldman Sachs. This report was preceded by an escalation of the now year-long crisis in the credit markets. Six months after the collapse of Bear Stearns, which was taken over by JP Morgan Chase, Lehman Brothers Holdings Inc filed for bankruptcy with a restructuring on Monday, while Merrill Lynch rushed into the arms of Bank of America Corp.
Lehman reported last week a loss of $3.9 billion in the third quarter, following a loss of $2.8 billion in the second quarter, influenced by $8 billion in losses related to write-offs of uncollectible debts, and a significant weakening of revenues from banking and risk management and trading services. (H)
