Goldman Sachs Group Inc. reported markedly higher profit in the fourth quarter, punctuating a turbulent year in which the Wall Street company benefited from the rapid recovery in markets from the worst of the pandemic-induced recession.
Goldman reported on Tuesday a quarterly profit of $ 4.51 billion, or $ 12.08 per share, more than double its level compared to the same quarter last year. Revenue of $ 11.74 billion was 18% above the level of the fourth quarter of 2019. Both measures were much better than the expectations of analysts heard by FactSet, who predicted earnings of $ 7.39 per share and revenue US $ 9.99 billion.
Goldman’s annual revenue of $ 44.56 billion was the highest since 2009, while annual commercial revenue peaked in 10 years.
For the banking sector in the United States, 2020 was a roller coaster year. Markets plunged and economic activity slowed in the spring, as the coronavirus spread across the country. With many deals closed and many consumers without work, banks prepared for widespread default. A robust federal spending program helped to prevent the worst economic scenario and, in earnings reports last week, bank executives signaled that the economy is holding up better than expected.
On Friday, JPMorgan Chase & Co. said fourth quarter earnings skyrocketed 42%, to a record $ 12.14 billion, after the bank released $ 2.9 billion of its stock of funds previously reserved to cover unpaid loans. On Tuesday, Bank of America Corp. said profit fell 22%, but exceeded analysts’ expectations after releasing $ 828 million from its loan loss reserves.