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| Goldman Sachs sees big quarterly profits fall | Goldman Sachs sees big quarterly profits fall |
| (35 minutes later) | |
| US investment bank Goldman Sachs has reported a big fall in quarterly profits, due largely to a reduction in bond trading revenue. | US investment bank Goldman Sachs has reported a big fall in quarterly profits, due largely to a reduction in bond trading revenue. |
| Net earnings for the three months to 31 December fell to $2.33bn (£1.43bn), down 19% compared with the same period last year. | |
| But full-year net earnings rose 8% to $8.04bn on revenues of $34.2bn. | But full-year net earnings rose 8% to $8.04bn on revenues of $34.2bn. |
| Rival bank Citigroup also reported results, with its profits also hit by reduced income from bond trading. | Rival bank Citigroup also reported results, with its profits also hit by reduced income from bond trading. |
| Citigroup reported adjusted net income of $2.6bn for the quarter, up from the $2.15bn a reported a year earlier but below many analysts' expectations. | |
| JP Morgan, which reported its results on Tuesday, also reported suffering from falling or stagnant bond trading volumes. | JP Morgan, which reported its results on Tuesday, also reported suffering from falling or stagnant bond trading volumes. |
| Mortgage revenue hit | Mortgage revenue hit |
| Goldman Sachs chief executive Lloyd Blankfein described the fixed-income market as "a somewhat challenging environment", as US investors prepare for higher interest rates. | Goldman Sachs chief executive Lloyd Blankfein described the fixed-income market as "a somewhat challenging environment", as US investors prepare for higher interest rates. |
| Goldman's revenue from client trading in fixed income, currencies and commodities dropped 15% in the fourth quarter to $1.72bn. | Goldman's revenue from client trading in fixed income, currencies and commodities dropped 15% in the fourth quarter to $1.72bn. |
| This was partly due to "significantly lower revenues in mortgages", the bank said. | This was partly due to "significantly lower revenues in mortgages", the bank said. |
| But quarterly investment banking revenues rose 22% year-on-year to $1.72bn. | But quarterly investment banking revenues rose 22% year-on-year to $1.72bn. |
| Net income applicable to shareholders fell to $2.25bn, or $4.60 a share, over the period, compared with $2.83bn, or $5.60 a share, in the same quarter in 2012, the bank said. | Net income applicable to shareholders fell to $2.25bn, or $4.60 a share, over the period, compared with $2.83bn, or $5.60 a share, in the same quarter in 2012, the bank said. |
| The bank paid out $12.6bn in pay and bonuses over the year, down 3% compared with 2012. | The bank paid out $12.6bn in pay and bonuses over the year, down 3% compared with 2012. |
| Looking forward, Mr Blankfein said: "We believe that we are well positioned to generate solid returns as the economy continues to heal and provide considerable upside for our shareholders as conditions materially improve." | Looking forward, Mr Blankfein said: "We believe that we are well positioned to generate solid returns as the economy continues to heal and provide considerable upside for our shareholders as conditions materially improve." |
| 'Substantial progress' | 'Substantial progress' |
| Citigroup saw its overall revenues fall 2% to $17.9bn for the fourth quarter, due in part to a decline in mortgage loan refinancing volumes. | Citigroup saw its overall revenues fall 2% to $17.9bn for the fourth quarter, due in part to a decline in mortgage loan refinancing volumes. |
| Fixed-income revenues fell 15.5% to $2.3bn, but a rebound in the stock market meant investment banking revenues rose 3% to just over $1bn. | Fixed-income revenues fell 15.5% to $2.3bn, but a rebound in the stock market meant investment banking revenues rose 3% to just over $1bn. |
| In a statement Citigroup's chief executive Michael Corbat admitted that his bank "didn't finish the year as strongly we would have liked", but said it has still made "substantial progress". | In a statement Citigroup's chief executive Michael Corbat admitted that his bank "didn't finish the year as strongly we would have liked", but said it has still made "substantial progress". |
| "We enter 2014 as a strong and stable institution," he said. | "We enter 2014 as a strong and stable institution," he said. |
| Shares in Citigroup fell more than 4% as the markets opened on Wall Street. Goldman Sachs shares rose 0.4%. |