Goldman Sachs sees bumper profit [$3.44bn for Q2]

[edesignuk]

US bank Goldman Sachs has unveiled a profit of $3.44bn (£2.1bn) for the April to June period - well above what analysts had forecast.

It comes after the bank startled Wall Street by reporting it made $1.8bn in the first three months of the year, despite the economic crisis.

The firm has recently paid back $10bn in federal aid intended to help it steer through the global turmoil.

It is expected to pay about $18bn in pay and bonuses to its 28,000 staff.

Six months ago, Goldman saw its first quarterly loss since going public in 1999, after being battered by the economic crisis.

Its share price, while still well off its high, has gained about 75% in 2009.

BBC.

All things being equal (which of course they're not), that would be ~$643,000 for each member of staff - salary including bonus.

 

[iShater]

BBC.

All things being equal (which of course they're not), that would be ~$643,000 for each member of staff - salary including bonus.

But it is not given equally, someone is making millions, while others are not. Still pretty good deal.

It helps to be one of the remaining investment firms around.

 

[LizKat]

Meanwhile they're likely short on everything I own... so glad i helped bail them out

 

[iShater]

I don't believe they really needed to be bailed out if I recall, more of the "we better take it or else" or "look, free money!".

 

[theMaccer]

Its not surprising at all that they are making record high profit. With all the competitors gone, and they can borrow from US Treasury @ 0%, and loan them @ 10%. What makes me sick is the amount of bonus being paid.

 

[LizKat]

I don't believe they really needed to be bailed out if I recall, more of the "we better take it or else" or "look, free money!".

Yes I think you're right on that. And at the time it was actually pretty sensible to make all those guys be seen as sitting at the same table and accepting some money. The sky-high level of mistrust and the desire to sort out which banks were "viable" seemed to be making the liquidity situation even worse than it already was. We were enroute to the deep freeze, I mean a block of ice from one pole to the other.

 

[Vogue Harper]

I don't have a problem with Goldman making this sort of profit because they are probably the only investment bank (although I think they are no longer technically an investment bank now after they moved themselves out of the auspices of SEC to the Fed) which made it on merit rather than those banks who took a rather more cavalier approach to boosting their profits.

And it's probably sustainable as well because (a) they don't have much exposure to risky assets, they typically didn't dip into them heavily initially and what little they did have they either sold or wrote down in the last few months so there are not any Credit Suisse style 'hidden' losses; and (b) their competitors are all walking wounded still trying to work out which way is up.

 

[BoyBach]

It's good to see that the worlds banks have realised their mistakes of the past and not fallen back into its bad old ways.

At least nobody has revived the 125% mortgages...