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| Goldman Sachs profits down by half on weak debt trading | Goldman Sachs profits down by half on weak debt trading |
| (40 minutes later) | |
| Wall Street firm Goldman Sachs has reported $2.39bn (£1.49bn) net income in the fourth quarter, down 53% from a year ago. | |
| The poor result was as expected, and follows similarly weak numbers from rival Citigroup on Tuesday. | The poor result was as expected, and follows similarly weak numbers from rival Citigroup on Tuesday. |
| As at Citigroup, the investment bank's performance was dragged down by weak business at its fixed income division. | As at Citigroup, the investment bank's performance was dragged down by weak business at its fixed income division. |
| The division is responsible for trading bonds, currencies, commodities and credit derivatives among others. | |
| Net earnings for the whole of 2010 totalled £8.4bn, down 38% on 2009, according to the broker-dealer's financial statement. | |
| This was calculated after the Wall Street firm deducted the cost of $15.4bn "compensation and benefits", which were down only 5% on the previous year. | |
| The figures mean that average pay per employee works out at $431,000, although the company's top earners are likely to be paid several times this amount. | |
| In total. the company awarded 39% of its $39bn net revenues for the year to its employees, leaving only a 21% share attributable to shareholders as net earnings. | |
| 'Low client activity' | |
| The fourth quarter figures rounded off a year that has become progressively more difficult for Goldman. | |
| At $3.79, earnings per share for the last three months slightly beat analysts' expectations of $3.76. | |
| However, net revenues - a better measure of overall business levels - undershot expectations, down 10% from a year ago at $8.64bn, versus an expected $9bn. | |
| "Looking ahead, we are seeing signs of growth and more economic activity," said chairman and chief executive, Lloyd Blankfein. | |
| Business at the company's fixed income group was particularly lacklustre, reporting net revenues down 48% on a year earlier, and follows a similarly dismal third quarter for the group. | |
| Goldman blamed "low client activity levels" for the poor performance. | |
| The firm blamed the same reason for a 10% fall in net revenues at its "investment banking" wing, which provides financial advice on mergers and acquisitions, and arranges new bond and share issues for clients. |