The US investment bank Goldman Sachs announced strong profit growth in Q2 2016 after recovering from a brutal start to the year, reports The Wall Street Journal. And profit and the company’s revenue exceeded expectations. The net income for the second quarter of New York-based bank rose to 1.82 billion USD, or 3.72 USD per share, from 1.05 billion USD, or 1.98 USD per share, a year earlier. Profit in the previous quarter of the year was under pressure because of legal costs 1.45 billion USD related to the agreement with the US Department of Justice in a case involving mortgage loans. However, revenues fell by 13% to 7.93 billion USD from 9.07 billion USD.
Expectations were bank from Wall Street to a profit of 3 USD per share with revenue of 7.58 billion USD, according to the median forecast of analysts. Goldman is trying to recover from the first quarter, which was the worst since the beginning of the management of Chairman and CEO Lloyd Blankfayn. Over the past three months, the company expand into new directions, such as offering online savings accounts through your bank division. At the same time the bank reduced its other businesses. According to previous information WSJ Goldman shrank hundreds of jobs in the subdivision for trading bonds since the beginning of the year.
Revenues from trading increased by 2% to 3.68 billion USD from 3.6 billion USD on an annual basis, led by 20% growth of trading in bonds, currencies and commodities. Revenues from trading securities, however, fell by 12%. In the investment division reported revenue decline of 11% to 1.79 billion USD from 2.02 billion USD in the second quarter of 2015, affected by lower performance of the segments of corporate consulting and delisting of shares. The bank stressed that its revenue from writing off the debt increased by 20% to 724 million USD, which is its second best performance for the quarter.
Shares of Goldman, which reported no significant change in trading before the market opening, are down 9.4 percent this year, which is worse than the decline of 7.7% in the index for large commercial banks KBW Nasdaq Bank.