EX-99.1 2 d188544dex991.htm EX-99.1 EX-99.1

Exhibit 99.1

 

LOGO

 

 

Second Quarter 2021 Earnings Results

 

    Media Relations: Andrea Williams 212-902-5400

    Investor Relations: Carey Halio 212-902-0300    

 

   

 

The Goldman Sachs Group, Inc.              

200 West Street | New York, NY 10282              

 

   

Second Quarter 2021 Earnings Results

Goldman Sachs Reports Second Quarter Earnings Per Common Share of $15.02 and Increases the Quarterly Dividend to $2.00 Per Common Share

 

 

“Our second quarter performance and record revenues for the first half of the year demonstrate the strength of our client franchise and our continued progress on our strategic priorities. While the economic recovery is underway, our clients and communities still face challenges in overcoming the pandemic. But, as always, I am proud of the dedication and resilience of our people, who have worked tirelessly to help our clients navigate the ever-changing market environment.”

 

- David M. Solomon, Chairman and Chief Executive Officer        

 

 

 

Financial Summary

 

 

 

     

    

     

  

 

Net Revenues

 

  

 

Net Earnings

 

  

 

EPS

 

 

2Q                           $15.39 billion 

 

2Q YTD                    $33.09 billion 

 

  

 

 2Q                           $5.49 billion 

 

 2Q YTD                 $12.32 billion 

 

  

 

2Q                                 $15.02 

 

2Q YTD                         $33.64 

 

 

    

        

 

Annualized ROE1

 

    

 

Annualized  ROTE1

 

    

 

Book Value Per Share

 

 

2Q                                       23.7% 

 

2Q YTD                               27.3% 

 

    

 

2Q                                     25.1% 

 

2Q YTD                             28.9% 

 

    

 

2Q                                  $264.90 

 

 YTD Growth                  12.2% 

 

       

NEW YORK, July 13, 2021 – The Goldman Sachs Group, Inc. (NYSE: GS) today reported net revenues of $15.39 billion and net earnings of $5.49 billion for the second quarter ended June 30, 2021. Net revenues were $33.09 billion and net earnings were $12.32 billion for the first half of 2021.

Diluted earnings per common share (EPS) was $15.02 for the second quarter of 2021 compared with $0.53 for the second quarter of 2020 and $18.60 for the first quarter of 2021, and was $33.64 for the first half of 2021 compared with $3.66 for the first half of 2020. In the prior year, net provisions for litigation and regulatory proceedings reduced diluted EPS by $8.23 for the second quarter of 2020 and $8.76 for the first half of 2020.

Annualized return on average common shareholders’ equity (ROE)1 was 23.7% for the second quarter of 2021 and 27.3% for the first half of 2021. Annualized return on average tangible common shareholders’ equity (ROTE)1 was 25.1% for the second quarter of 2021 and 28.9% for the first half of 2021.

1      

 

Goldman Sachs Reports

Second Quarter 2021 Earnings Results

 

 

Highlights

 

 

  ◾  

Strong overall firm performance continued in the second quarter as results reflected the second highest quarterly net revenues of $15.39 billion, the second highest quarterly net earnings of $5.49 billion and the second highest quarterly diluted EPS of $15.02.

 

 

  ◾  

Investment Banking generated its second highest quarterly net revenues of $3.61 billion, which followed record net revenues in the first quarter of 2021. Quarterly net revenues were also the second highest in each of Financial advisory, Equity underwriting and Debt underwriting. The backlog2 increased significantly compared with the end of 2020, ending the quarter at a record level.

 

 

  ◾  

The firm ranked #1 in worldwide announced and completed mergers and acquisitions, worldwide equity and equity-related offerings, common stock offerings and initial public offerings for the year-to-date.3

 

 

  ◾  

Global Markets generated quarterly net revenues of $4.90 billion, reflecting solid client activity across both Fixed Income, Currency and Commodities (FICC) and Equities.

 

 

  ◾  

Asset Management generated record quarterly net revenues of $5.13 billion, reflecting record quarterly net revenues from Equity investments.

 

 

  ◾  

Consumer & Wealth Management generated record quarterly net revenues of $1.75 billion.

 

 

  ◾  

Firmwide assets under supervision2,4 increased $101 billion during the quarter, including long-term net inflows of $22 billion, to a record $2.31 trillion. Firmwide Management and other fees were a record $1.84 billion for the second quarter of 2021.

 

 

  ◾  

Book value per common share increased by 5.6% during the quarter and 12.2% during the first half of 2021 to $264.90.

 

 

  ◾  

On July 12, 2021, the Board of Directors of The Goldman Sachs Group, Inc. approved a 60% increase in the quarterly dividend to $2.00 per common share beginning in the third quarter of 2021.

 

 

 

Quarterly Net Revenue Mix by Segment

 

         LOGO   LOGO

2      

 

Goldman Sachs Reports

Second Quarter 2021 Earnings Results

 

 

Net Revenues

 

    

 

Net revenues were $15.39 billion for the second quarter of 2021, 16% higher than the second quarter of 2020 and 13% lower than the first quarter of 2021. The increase compared with the second quarter of 2020 reflected significantly higher net revenues in Asset Management, Investment Banking and Consumer & Wealth Management, partially offset by significantly lower net revenues in Global Markets.

       

 

Net Revenues

 

   

 

$15.39 billion

 

   
   
   

 

 

 

  

 

   Investment Banking  

 

  

 

  

 

Net revenues in Investment Banking were $3.61 billion for the second quarter of 2021, 36% higher than the second quarter of 2020 and 4% lower than a strong first quarter of 2021. The increase compared with the second quarter of 2020 reflected significantly higher net revenues in Financial advisory and Corporate lending and higher net revenues in Underwriting.

 

The increase in Financial advisory net revenues reflected an increase in completed mergers and acquisitions transactions. The increase in Corporate lending net revenues primarily reflected higher net interest income. The increase in Underwriting net revenues was due to higher net revenues in Equity underwriting, primarily driven by strong industry-wide initial public offering activity, partially offset by a significant decline in industry-wide secondary offerings. Debt underwriting net revenues were slightly lower, primarily reflecting significantly lower industry-wide investment-grade volumes, partially offset by elevated industry-wide leveraged finance volumes.

 

The firm’s backlog2 increased significantly compared with the end of 2020, and was higher compared with the end of the first quarter of 2021.

    

 

Investment Banking

 

   

 

$3.61 billion

 

      

Financial Advisory

  

    $1.26 billion 

   

Underwriting

  

    $2.19 billion 

   

Corporate Lending  

 

  

    $159 million  

 

     
     
     
     
     
     
     
     

 

 

 

  

 

   Global Markets  

 

  

 

  

 

Net revenues in Global Markets were $4.90 billion for the second quarter of 2021, 32% lower than a strong second quarter of 2020 and 35% lower than a strong first quarter of 2021.

 

Net revenues in FICC were $2.32 billion, 45% lower than the second quarter of 2020, as the prior year period included strong activity levels due to high volatility amid the COVID-19 pandemic. The decrease in net revenues was due to significantly lower net revenues in FICC intermediation, reflecting significantly lower net revenues in interest rate products, credit products and commodities, and lower net revenues in mortgages and currencies. In addition, net revenues in FICC financing were lower, reflecting lower net revenues from repurchase agreements, partially offset by higher net revenues from mortgage lending.

 

Net revenues in Equities were $2.58 billion, 12% lower than the second quarter of 2020, due to significantly lower net revenues in Equities intermediation, reflecting significantly lower net revenues in cash products and lower net revenues in derivatives. Net revenues in Equities financing were higher, reflecting higher average client balances.

       

 

Global Markets

 

   

 

$4.90 billion

 

   

FICC Intermediation

  

$1.90 billion  

   

FICC Financing

  

$423 million  

   

FICC

  

$2.32 billion  

       
   

Equities Intermediation

  

$1.77 billion  

   

Equities Financing

  

$815 million  

   

Equities

 

  

$2.58 billion  

 

     
     
     
     
     
     

3      

 

Goldman Sachs Reports

Second Quarter 2021 Earnings Results

 

 

      

 

   Asset Management  

 

       

 

Net revenues in Asset Management were $5.13 billion for the second quarter of 2021, more than double the amount in the second quarter of 2020 and 11% higher than the first quarter of 2021. The increase compared with the second quarter of 2020 was primarily driven by significantly higher net revenues in Equity investments. In addition, Lending and debt investments net revenues, Incentive fees and Management and other fees were each higher.

 

The increase in Equity investments net revenues primarily reflected significantly higher net gains from investments in private equities, driven by company-specific events, including capital raises and sales, and improved corporate performance versus a challenging second quarter of 2020. The increase in Lending and debt investments net revenues was primarily due to higher net interest income. The increase in Incentive fees was due to harvesting. Management and other fees included the impact of higher average assets under supervision and higher other fees, partially offset by fee waivers on money market funds.

    

 

Asset Management

   

 

$5.13 billion

 

   

Management and

    
   

  Other Fees

   $727 million  
   

Incentive Fees

   $  78 million  
   

Equity Investments

   $3.72 billion  
 

  

  

Lending and Debt

  Investments

  

$610 million  

 

     
     
     
     
     
     

 

      

 

   Consumer & Wealth Management  

 

       

 

Net revenues in Consumer & Wealth Management were $1.75 billion for the second quarter of 2021, 28% higher than the second quarter of 2020 and essentially unchanged compared with the first quarter of 2021.

 

Net revenues in Wealth management were $1.38 billion, 25% higher than the second quarter of 2020. Management and other fees were higher, reflecting the impact of higher average assets under supervision, and net revenues in Private banking and lending were higher, primarily reflecting higher loan balances.

 

Net revenues in Consumer banking were $363 million, 41% higher than the second quarter of 2020, reflecting higher deposit and credit card balances.

    

 

Consumer &

Wealth Management

 

   

 

$1.75 billion

 

   

 

Wealth Management

   $1.38 billion  
   

Consumer Banking

  

$363 million  

 

     
     
     
     
     

 

 

Provision for Credit Losses

 

 

Provision for credit losses was a net benefit of $92 million for the second quarter of 2021, compared with net provisions of $1.59 billion for the second quarter of 2020 and a net benefit of $70 million for the first quarter of 2021. The second quarter of 2021 included reserve reductions on wholesale and consumer loans reflecting continued improvement in the broader economic environment following challenging conditions that began in the first half of 2020 as a result of the COVID-19 pandemic, partially offset by provisions related to portfolio growth (primarily in credit card loans).

 

The firm’s allowance for credit losses was $4.09 billion as of June 30, 2021.

       
   

 

 

Provision for Credit Losses

   

 

$(92) million

 

   
   
   
   
   
   
   
   

4      

 

Goldman Sachs Reports

Second Quarter 2021 Earnings Results

 

 

Operating Expenses

 

 

Operating expenses were $8.64 billion for the second quarter of 2021, 17% lower than the second quarter of 2020 and 8% lower than the first quarter of 2021. The firm’s efficiency ratio2 for the first half of 2021 was 54.6%, compared with 76.6% for the first half of 2020.

  

 

  

 

Operating Expenses

 

 

 

$8.64 billion

 

 

 

The decrease in operating expenses compared with the second quarter of 2020 was due to significantly lower non-compensation expenses, partially offset by higher compensation and benefits expenses (reflecting strong performance). Within non-compensation expenses, net provisions for litigation and regulatory proceedings were significantly lower, partially offset by higher transaction based expenses and higher technology expenses (included in communications and technology and depreciation and amortization).

 

Net provisions for litigation and regulatory proceedings for the second quarter of 2021 were $226 million compared with $2.96 billion for the second quarter of 2020.

 

Headcount was essentially unchanged compared with the end of the first quarter of 2021.

 

  

 

YTD Efficiency Ratio

 

 

 

54.6%

 

 
 
   
   
   
   
   
   
   
   
   

 

Provision for Taxes

 

 

The effective income tax rate for the first half of 2021 increased to 18.8% from 18.0% for the first quarter of 2021, primarily due to a decrease in the impact of tax benefits on the settlement of employee share-based awards in the first half of 2021 compared with the first quarter of 2021.

      

 

YTD Effective Tax Rate

 

   

 

18.8%

 

   

 

 

Other Matters

 

 

◾ On July 12, 2021, the Board of Directors of The Goldman Sachs Group, Inc. increased the quarterly dividend to $2.00 per common share from $1.25 per common share. The dividend will be paid on September 29, 2021 to common shareholders of record on September 1, 2021.

 

◾ During the quarter, the firm returned $1.44 billion of capital to common shareholders, including $1.00 billion of share repurchases (2.8 million shares at an average cost of $350.90) and $441 million of common stock dividends.2

 

◾ Global core liquid assets2 averaged $329 billion4 for the second quarter of 2021, compared with an average of $299 billion for the first quarter of 2021.

      

 

Declared Quarterly

Dividend Per Common Share

 

 

 

$2.00

 

 
 

 

Common Share Repurchases

 

 

 

$2.8 million shares for

$1.00 billion

 

   
   

 

Average GCLA

 

   

 

$329 billion

 

5      

 

Goldman Sachs Reports

Second Quarter 2021 Earnings Results

 

 

The Goldman Sachs Group, Inc. is a leading global financial institution that delivers a broad range of financial services across investment banking, securities, investment management and consumer banking to a large and diversified client base that includes corporations, financial institutions, governments and individuals. Founded in 1869, the firm is headquartered in New York and maintains offices in all major financial centers around the world.

 

          

 

   Cautionary Note Regarding Forward-Looking Statements  

 

            

This press release contains “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements are not historical facts or statements of current conditions, but instead represent only the firm’s beliefs regarding future events, many of which, by their nature, are inherently uncertain and outside of the firm’s control. It is possible that the firm’s actual results, financial condition and liquidity may differ, possibly materially, from the anticipated results, financial condition and liquidity in these forward-looking statements. For information about some of the risks and important factors that could affect the firm’s future results, financial condition and liquidity, see “Risk Factors” in Part I, Item 1A of the firm’s Annual Report on Form 10-K for the year ended December 31, 2020.

Information regarding the firm’s assets under supervision, capital ratios, risk-weighted assets, supplementary leverage ratio, balance sheet data, global core liquid assets and VaR consists of preliminary estimates. These estimates are forward-looking statements and are subject to change, possibly materially, as the firm completes its financial statements.

Statements about the firm’s investment banking transaction backlog also may constitute forward-looking statements. Such statements are subject to the risk that transactions may be modified or may not be completed at all and related net revenues may not be realized or may be materially less than expected. Important factors that could have such a result include, for underwriting transactions, a decline or weakness in general economic conditions, an outbreak of hostilities, volatility in the securities markets or an adverse development with respect to the issuer of the securities and, for financial advisory transactions, a decline in the securities markets, an inability to obtain adequate financing, an adverse development with respect to a party to the transaction or a failure to obtain a required regulatory approval. For information about other important factors that could adversely affect the firm’s investment banking transactions, see “Risk Factors” in Part I, Item 1A of the firm’s Annual Report on Form 10-K for the year ended December 31, 2020.

 

          

 

   Conference Call  

 

             

A conference call to discuss the firm’s financial results, outlook and related matters will be held at 9:30 am (ET). The call will be open to the public. Members of the public who would like to listen to the conference call should dial 1-888-281-7154 (in the U.S.) or 1-706-679-5627 (outside the U.S.). The number should be dialed at least 10 minutes prior to the start of the conference call. The conference call will also be accessible as an audio webcast through the Investor Relations section of the firm’s website, www.goldmansachs.com/investor-relations. There is no charge to access the call. For those unable to listen to the live broadcast, a replay will be available on the firm’s website or by dialing 1-855-859-2056 (in the U.S.) or 1-404-537-3406 (outside the U.S.) passcode number 64774224 beginning approximately three hours after the event. Please direct any questions regarding obtaining access to the conference call to Goldman Sachs Investor Relations, via e-mail, at gs-investor-relations@gs.com.

6      

 

Goldman Sachs Reports

Second Quarter 2021 Earnings Results

 

The Goldman Sachs Group, Inc. and Subsidiaries

Segment Net Revenues (unaudited)

$ in millions

 

     
     THREE MONTHS ENDED           % CHANGE FROM  
         
    

JUNE 30,

2021

    

MARCH 31,

2021

    

JUNE 30,

2020

             

MARCH 31,

2021

    

JUNE 30,

2020

  

 

INVESTMENT BANKING

 

                                          

 

Financial advisory

     $             1,257         $           1,117         $                686                                13  %                           83  %  
                 

Equity underwriting

     1,243         1,569         1,057            (21)           18       

Debt underwriting

 

    

 

 950  

 

  

 

    

 

 880  

 

  

 

    

 

 990   

 

  

 

      

 

 8     

 

  

 

    

 

 (4)    

 

  

 

Underwriting

     2,193         2,449         2,047            (10)           7       
                 

Corporate lending

 

    

 

 159  

 

  

 

    

 

 205  

 

  

 

    

 

 (76)  

 

  

 

      

 

 (22)    

 

  

 

    

 

 N.M.     

 

  

 

 

Net revenues

 

    

 

 3,609  

 

  

 

    

 

 3,771  

 

  

 

    

 

 2,657   

 

  

 

      

 

 (4)    

 

  

 

    

 

 36     

 

  

 

                 

 

GLOBAL MARKETS

 

                                          

 

FICC intermediation

     1,897         3,451         3,786            (45)           (50)      

FICC financing

 

    

 

 423  

 

  

 

    

 

 442  

 

  

 

    

 

 449   

 

  

 

      

 

 (4)    

 

  

 

    

 

 (6)    

 

  

 

FICC

     2,320         3,893         4,235            (40)           (45)      
                 

Equities intermediation

     1,765         2,586         2,199            (32)           (20)      

 

Equities financing

    

 

 815  

 

  

 

    

 

 1,102  

 

  

 

    

 

 742   

 

  

 

      

 

 (26)    

 

  

 

    

 

 10     

 

  

 

 

Equities

 

    

 

 2,580  

 

  

 

    

 

 3,688  

 

  

 

    

 

 2,941   

 

  

 

      

 

 (30)    

 

  

 

    

 

 (12)    

 

  

 

Net revenues

 

    

 

 4,900  

 

  

 

    

 

 7,581  

 

  

 

    

 

 7,176   

 

  

 

      

 

 (35)    

 

  

 

    

 

 (32)    

 

  

 

                 

 

ASSET MANAGEMENT

 

                                          

 

Management and other fees

     727         693         684            5            6       

 

Incentive fees

 

     78         42         34            86            129       

Equity investments

     3,717         3,120         924            19            302       

 

Lending and debt investments

 

    

 

 610  

 

  

 

    

 

 759  

 

  

 

    

 

 459   

 

  

 

      

 

 (20)    

 

  

 

    

 

 33     

 

  

 

Net revenues

 

    

 

 5,132  

 

  

 

    

 

 4,614  

 

  

 

    

 

 2,101   

 

  

 

      

 

 11     

 

  

 

    

 

 144     

 

  

 

                 

 

CONSUMER & WEALTH MANAGEMENT

 

                                          

 

Management and other fees

     1,109         1,077         938            3            18       

 

Incentive fees

     15         26         10            (42)           50       

 

Private banking and lending

 

    

 

 260  

 

  

 

    

 

 264  

 

  

 

    

 

 155   

 

  

 

      

 

 (2)    

 

  

 

    

 

 68     

 

  

 

Wealth management

     1,384         1,367         1,103            1            25       
                 

Consumer banking

 

    

 

 363  

 

  

 

    

 

 371  

 

  

 

    

 

 258   

 

  

 

      

 

 (2)    

 

  

 

    

 

 41     

 

  

 

Net revenues

 

    

 

 1,747  

 

  

 

    

 

 1,738  

 

  

 

    

 

 1,361   

 

  

 

      

 

 1     

 

  

 

    

 

 28     

 

  

 

                 

 

Total net revenues

 

    

 

 $        15,388  

 

  

 

    

 

 $        17,704  

 

  

 

    

 

 $            13,295   

 

  

 

      

 

 (13)    

 

  

 

    

 

 16     

 

  

 

 

Geographic Net Revenues (unaudited)2

 

          
$ in millions            
   
     THREE MONTHS ENDED                    
     
    

JUNE 30,

2021

    

MARCH 31,

2021

    

JUNE 30,

2020

                       

 

Americas

     $          9,957         $        10,825         $              8,289           

 

EMEA

     3,478         4,713         3,453           

 

Asia

 

    

 

 1,953  

 

  

 

    

 

 2,166  

 

  

 

    

 

 1,553   

 

  

 

      

Total net revenues

 

    

 

 $        15,388  

 

  

 

    

 

 $        17,704  

 

  

 

    

 

 $            13,295   

 

  

 

      
               

Americas

     65%        61%        62%        

 

EMEA

     22%        27%        26%        

 

Asia

 

    

 

 13% 

 

  

 

    

 

 12% 

 

  

 

    

 

 12%

 

  

 

      

Total

 

    

 

 100% 

 

  

 

    

 

 100% 

 

  

 

    

 

 100%

 

  

 

      

 

7

Goldman Sachs Reports

Second Quarter 2021 Earnings Results

 

The Goldman Sachs Group, Inc. and Subsidiaries

Segment Net Revenues (unaudited)

$ in millions

 

     
     SIX MONTHS ENDED          % CHANGE FROM                                 
     
    

JUNE 30,

2021

    

JUNE 30,

2020

           

JUNE 30,

2020

      

 

INVESTMENT BANKING

 

                            

 

Financial advisory

     $           2,374          $           1,467            62  %    
               

Equity underwriting

     2,812          1,435            96         

 

Debt underwriting

     1,830          1,573            16         

 

Underwriting

     4,642          3,008            54         
               

 

Corporate lending

 

    

 

 364   

 

  

 

    

 

 366   

 

  

 

      

 

 (1)    

 

  

 

  

 

Net revenues

 

    

 

 7,380   

 

  

 

    

 

 4,841   

 

  

 

      

 

 52     

 

  

 

  
               

 

GLOBAL MARKETS

 

                            

 

FICC intermediation

     5,348          6,323            (15)        

 

FICC financing

     865          881            (2)        

 

FICC

     6,213          7,204            (14)        
               

Equities intermediation

     4,351          3,727            17         

 

Equities financing

     1,917          1,408            36         

 

Equities

 

    

 

 6,268   

 

  

 

    

 

 5,135   

 

  

 

      

 

 22     

 

  

 

  

 

Net revenues

 

    

 

 12,481   

 

  

 

    

 

 12,339   

 

  

 

      

 

 1     

 

  

 

  
               

 

ASSET MANAGEMENT

 

                            

 

Management and other fees

     1,420          1,324            7         

 

Incentive fees

     120          188            (36)        

 

Equity investments

     6,837          902            658         

 

Lending and debt investments

 

    

 

 1,369   

 

  

 

    

 

 (409)  

 

  

 

      

 

 N.M.    

 

  

 

  

 

Net revenues

 

    

 

 9,746   

 

  

 

    

 

 2,005   

 

  

 

      

 

 386     

 

  

 

  
               

 

CONSUMER & WEALTH MANAGEMENT

 

                            

 

Management and other fees

     2,186          1,897            15         

 

Incentive fees

     41          79            (48)        

 

Private banking and lending

     524          337            55         

 

Wealth management

     2,751          2,313            19         
               

Consumer banking

 

    

 

 734   

 

  

 

    

 

 540   

 

  

 

      

 

 36     

 

  

 

  

 

Net revenues

 

    

 

 3,485   

 

  

 

    

 

 2,853   

 

  

 

      

 

 22     

 

  

 

  
               

 

Total net revenues

 

    

 

 $         33,092   

 

  

 

    

 

 $         22,038   

 

  

 

      

 

 50     

 

  

 

  

 

Geographic Net Revenues (unaudited)2

$ in millions

 

 

 

        
   
     SIX MONTHS ENDED                
   
    

JUNE 30,

2021

    

JUNE 30,

2020

                

Americas

     $         20,782          $         13,460            

 

EMEA

     8,191          5,561            

 

Asia

 

    

 

 4,119   

 

  

 

    

 

 3,017    

 

  

 

      

 

Total net revenues

 

    

 

 $         33,092   

 

  

 

    

 

 $         22,038    

 

  

 

      
             

Americas

     63%        61%         

 

EMEA

     25%        25%         

 

Asia

 

    

 

 12% 

 

  

 

    

 

 14% 

 

  

 

      

 

Total

 

    

 

 100% 

 

  

 

    

 

 100% 

 

  

 

      

 

8

Goldman Sachs Reports

Second Quarter 2021 Earnings Results

 

The Goldman Sachs Group, Inc. and Subsidiaries

Consolidated Statements of Earnings (unaudited)

In millions, except per share amounts and headcount

 

     
     THREE MONTHS ENDED          % CHANGE FROM           
       
     JUNE 30,
2021		           MARCH 31,     
2021		          JUNE 30,    
2020		                  MARCH 31,     
2021		          JUNE 30,    
2020		        

 

REVENUES

 

                                                

 

Investment banking

     $           3,450         $         3,566         $         2,733            (3) %        26  %    

 

Investment management

     1,905         1,796         1,635            6             17         

 

Commissions and fees

     833         1,073         875            (22)            (5)        

 

Market making

     3,274         5,893         5,787            (44)            (43)        

 

Other principal transactions

 

    

 

 4,297 

 

  

 

     

 

 3,894 

 

  

 

     

 

 1,321  

 

  

 

       

 

 10     

 

  

 

     

 

 225     

 

  

 

  

 

Total non-interest revenues

 

    

 

 13,759 

 

  

 

     

 

 16,222 

 

  

 

     

 

 12,351  

 

  

 

       

 

 (15)    

 

  

 

     

 

 11     

 

  

 

  
                       

Interest income

     2,939         3,054         3,034            (4)            (3)        

 

Interest expense

 

    

 

 1,310 

 

  

 

     

 

 1,572 

 

  

 

     

 

 2,090  

 

  

 

       

 

 (17)    

 

  

 

      (37)        

 

Net interest income

 

    

 

 1,629 

 

  

 

     

 

 1,482 

 

  

 

     

 

 944  

 

  

 

       

 

 10     

 

  

 

   

 

 

 

 

73     

 

 

 

 

  
                       

 

Total net revenues

 

    

 

 15,388 

 

  

 

     

 

 17,704 

 

  

 

     

 

 13,295  

 

  

 

       

 

 (13)    

 

  

 

     

 

 16     

 

  

 

  
                       

 

Provision for credit losses

 

    

 

 (92)

 

  

 

     

 

 (70)

 

  

 

     

 

 1,590  

 

  

 

       

 

 N.M.     

 

  

 

     

 

 N.M.    

 

  

 

  
                       

 

OPERATING EXPENSES

 

                                                

 

Compensation and benefits

     5,263         6,043         4,478            (13)            18         

 

Transaction based

     1,125         1,256         1,014            (10)            11         

 

Market development

     115         80         89            44             29         

 

Communications and technology

     371         375         345            (1)            8         

 

Depreciation and amortization

     520         498         499            4             4         

 

Occupancy

     241         247         233            (2)            3         

 

Professional fees

     344         360         311            (4)            11         

 

Other expenses

 

     661         578         3,445           

 

 14     

 

  

 

     

 

 (81)    

 

  

 

  

 

Total operating expenses

 

    

 

 8,640 

 

  

 

     

 

 9,437 

 

  

 

     

 

 10,414  

 

  

 

       

 

 (8)    

 

  

 

     

 

 (17)    

 

  

 

  
                       

Pre-tax earnings

     6,840         8,337         1,291            (18)            430         

 

Provision for taxes

 

     1,354         1,501         918           

 

 (10)    

 

  

 

     

 

 47     

 

  

 

  

 

Net earnings

 

     5,486         6,836         373           

 

 (20)    

 

  

 

     

 

 N.M.    

 

  

 

  
       

Preferred stock dividends

 

     139         125         176           

 

 11     

 

  

 

     

 

 (21)    

 

  

 

  

 

Net earnings applicable to common shareholders

 

    

 

 $             5,347 

 

  

 

     

 

 $           6,711 

 

  

 

     

 

 $            197  

 

  

 

       

 

 (20)    

 

  

 

     

 

 N.M.    

 

  

 

  
                       

 

EARNINGS PER COMMON SHARE2

 

                                                

 

Basic

     $             15.22         $           18.80         $           0.53            (19) %        N.M. %    

 

Diluted

     $             15.02         $           18.60         $           0.53            (19)            N.M.        
                       

 

AVERAGE COMMON SHARES

 

                                                

 

Basic

     350.8         356.6         355.7            (2)            (1)        

 

Diluted

     356.0         360.9         355.7            (1)            –         
                       

 

SELECTED DATA AT PERIOD-END

 

                                                

 

Common shareholders’ equity

     $         92,687         $       88,461         $       78,826            5             18         

 

Basic shares2

     349.9         352.7         355.8            (1)            (2)        

 

Book value per common share

     $         264.90         $       250.81         $       221.55            6             20         
                       

Headcount

 

    

 

 40,800 

 

  

 

     

 

 40,300 

 

  

 

     

 

 39,100  

 

  

 

       

 

 1     

 

  

 

     

 

 4     

 

  

 

  

 

9

Goldman Sachs Reports

Second Quarter 2021 Earnings Results

 

The Goldman Sachs Group, Inc. and Subsidiaries

Consolidated Statements of Earnings (unaudited)

In millions, except per share amounts

 

     
     SIX MONTHS ENDED           % CHANGE FROM                                   
     
    

    JUNE 30,    

2021

    

    JUNE 30,    

2020

             

JUNE 30,

2020

        

 

REVENUES

 

                            

Investment banking

 

     $           7,016        $          4,475           57 %     

Investment management

 

     3,701        3,403           9         

Commissions and fees

 

     1,906        1,895           1         

Market making

 

     9,167        9,469           (3)        

Other principal transactions

 

    

 

 8,191 

 

  

 

    

 

 539  

 

  

 

      

 

 N.M.    

 

  

 

  

 

Total non-interest revenues

 

    

 

 29,981 

 

  

 

    

 

 19,781  

 

  

 

      

 

 52     

 

  

 

  
               

Interest income

 

     5,993        7,784           (23)        

Interest expense

 

    

 

 2,882 

 

  

 

    

 

 5,527  

 

  

 

      

 

 (48)    

 

  

 

  

 

Net interest income

 

    

 

 3,111 

 

  

 

    

 

 2,257  

 

  

 

      

 

 38     

 

  

 

  
               

 

Total net revenues

 

    

 

 33,092 

 

  

 

    

 

 22,038  

 

  

 

      

 

 50     

 

  

 

  
               

 

Provision for credit losses

 

    

 

 (162)

 

  

 

    

 

 2,527  

 

  

 

      

 

 N.M.    

 

  

 

  
               

 

OPERATING EXPENSES

 

                            

Compensation and benefits

 

     11,306        7,713           47         

Transaction based

 

     2,381        2,044           16         

Market development

 

     195        242           (19)        

Communications and technology

 

     746        666           12         

Depreciation and amortization

 

     1,018        936           9         

Occupancy

 

     488        471           4         

Professional fees

 

     704        658           7         

Other expenses

 

    

 

 1,239 

 

  

 

    

 

 4,142  

 

  

 

      

 

 (70)    

 

  

 

  

Total operating expenses

 

    

 

 18,077 

 

  

 

    

 

 16,872  

 

  

 

      

 

 7     

 

  

 

  
               

Pre-tax earnings

     15,177        2,639           475         

 

Provision for taxes

     2,855        1,053           171         

Net earnings

 

     12,322        1,586           677         

Preferred stock dividends

 

     264        266           (1)        

 

Net earnings applicable to common shareholders

 

     $         12,058        $          1,320           813         
               

 

EARNINGS PER COMMON SHARE2

 

                            

Basic

     $           34.06        $            3.66           831 %     

 

Diluted

     $           33.64        $            3.66           819         
               

 

AVERAGE COMMON SHARES

                            

 

Basic

     353.6        356.8           (1)        

 

Diluted

 

    

 

 358.4 

 

  

 

    

 

 356.8  

 

  

 

      

 

 —     

 

  

 

  

 

10

Goldman Sachs Reports

Second Quarter 2021 Earnings Results

 

The Goldman Sachs Group, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets (unaudited)4

$ in billions

 

   
     AS OF                     
   
    

JUNE 30,

2021

    

MARCH 31,

2021

                                                                              

 

ASSETS

 

                        

 

Cash and cash equivalents

     $             240         $             191            

 

Collateralized agreements

     350         325            

 

Customer and other receivables

     162         165            

 

Trading assets

     376         374            

 

Investments

     91         88            

 

Loans

     131         121            

 

Other assets

 

     38         38            

 

Total assets

 

  

 

 

 

 

$           1,388  

 

 

 

 

  

 

 

 

 

$           1,302  

 

 

 

 

        
               

 

LIABILITIES AND SHAREHOLDERS’ EQUITY

 

                        

 

Deposits

     $             306         $             286            

 

Collateralized financings

     217         193            

 

Customer and other payables

     239         224            

 

Trading liabilities

     199         201            

 

Unsecured short-term borrowings

     62         58            

 

Unsecured long-term borrowings

     239         219            

 

Other liabilities

     24         23            

 

Total liabilities

 

  

 

 

 

 

1,286  

 

 

 

 

  

 

 

 

 

1,204  

 

 

 

 

        

 

Shareholders’ equity

 

     102         98            

 

Total liabilities and shareholders’ equity

 

  

 

 

 

 

$           1,388  

 

 

 

 

  

 

 

 

 

$           1,302  

 

 

 

 

        

 

Capital Ratios and Supplementary Leverage Ratio (unaudited)2,4

$ in billions

 

 

 

        
   
     AS OF                      
   
    

JUNE 30,

2021

    

MARCH 31,

2021

                  

 

Common equity tier 1 capital

     $             89.4         $             85.2            
               

 

STANDARDIZED CAPITAL RULES

 

                        

 

Risk-weighted assets

     $             621         $             595            

 

Common equity tier 1 capital ratio

     14.4%       14.3%          
               

 

ADVANCED CAPITAL RULES

 

                        

 

Risk-weighted assets

     $             667         $             630            

 

Common equity tier 1 capital ratio

     13.4%       13.5%          
               

 

SUPPLEMENTARY LEVERAGE RATIO

 

                        

 

Supplementary leverage ratio

 

     5.5%  5      6.5%          

 

Average Daily VaR (unaudited)2,4

$ in millions

 

 

 

        
   
     THREE MONTHS ENDED                      
   
    

JUNE 30,

2021

    

MARCH 31,

2021

                  

 

RISK CATEGORIES

 

                        

 

Interest rates

     $               64         $               58            

 

Equity prices

     48         51            

 

Currency rates

     13         12            

 

Commodity prices

     22         22            

 

Diversification effect

     (57)        (54)           

 

 

Total

 

  

 

 

 

 

$             90  

 

 

 

 

  

 

 

 

 

$               89  

 

 

 

 

        

 

11

Goldman Sachs Reports

Second Quarter 2021 Earnings Results

 

The Goldman Sachs Group, Inc. and Subsidiaries

Assets Under Supervision (unaudited)2,4

$ in billions

 

   
     AS OF                                                                 
   
         JUNE 30,    
2021		         MARCH 31,    
2021		         JUNE 30,    
2020		                    

 

SEGMENT

 

                              

Asset Management

 

    

 

 $        1,633 

 

  

 

    

 

 $        1,567 

 

  

 

    

 

 $        1,499 

 

  

 

      

Consumer & Wealth Management

 

    

 

 672 

 

  

 

    

 

 637 

 

  

 

    

 

 558 

 

  

 

      

Total AUS

 

    

 

 $        2,305 

 

  

 

    

 

 $        2,204 

 

  

 

    

 

 $        2,057 

 

  

 

      
               

 

ASSET CLASS

 

                              

Alternative investments

 

    

 

 $           211 

 

  

 

    

 

 $            197 

 

  

 

    

 

 $            179 

 

  

 

      

Equity

 

    

 

 558 

 

  

 

    

 

 516 

 

  

 

    

 

 394 

 

  

 

      

Fixed income

 

    

 

 914 

 

  

 

    

 

 885 

 

  

 

    

 

 817 

 

  

 

      

Total long-term AUS

 

    

 

 1,683 

 

  

 

    

 

 1,598 

 

  

 

    

 

 1,390 

 

  

 

      

Liquidity products

 

    

 

 622 

 

  

 

    

 

 606 

 

  

 

    

 

 667 

 

  

 

      

Total AUS

 

    

 

 $        2,305 

 

  

 

    

 

 $        2,204 

 

  

 

    

 

 $        2,057 

 

  

 

      
           
   
     THREE MONTHS ENDED                    
   
     JUNE 30,
2021		     MARCH 31,
2021		     JUNE 30,
2020		                    

 

ASSET MANAGEMENT

 

                              

Beginning balance

 

    

 

 $        1,567 

 

  

 

    

 

 $        1,530 

 

  

 

    

 

 $        1,309 

 

  

 

      

Net inflows / (outflows):

 

              

Alternative investments

    

 

 3 

 

  

 

    

 

 3 

 

  

 

    

 

 (2)

 

  

 

      

Equity

    

 

 (5)

 

  

 

    

 

 3 

 

  

 

    

 

 3 

 

  

 

      

Fixed income

    

 

 12 

 

  

 

    

 

 16 

 

  

 

    

 

 6 

 

  

 

      

Total long-term AUS net inflows / (outflows)

    

 

 10 

 

  

 

    

 

 22 

 

  

 

    

 

 7 

 

  

 

      

Liquidity products

    

 

 16 

 

  

 

    

 

 29 

 

  

 

    

 

 121 

 

  

 

      

Total AUS net inflows / (outflows)

    

 

 26 

 

  

 

    

 

 51 

 

  

 

    

 

 128 

 

  

 

      

Net market appreciation / (depreciation)

    

 

 40 

 

  

 

    

 

 (14)

 

  

 

    

 

 62 

 

  

 

      

Ending balance

    

 

 $        1,633 

 

  

 

    

 

 $        1,567 

 

  

 

    

 

 $        1,499 

 

  

 

      
               

 

CONSUMER & WEALTH MANAGEMENT

 

                              

Beginning balance

 

    

 

 $           637 

 

  

 

    

 

 $            615 

 

  

 

    

 

 $            509 

 

  

 

      

Net inflows / (outflows):

 

              

Alternative investments

 

    

 

 5 

 

  

 

    

 

 2 

 

  

 

    

 

 – 

 

  

 

      

Equity

 

    

 

 8 

 

  

 

    

 

 11 

 

  

 

    

 

 (1)

 

  

 

      

Fixed income

 

    

 

 (1)

 

  

 

    

 

 2 

 

  

 

    

 

 – 

 

  

 

      

Total long-term AUS net inflows / (outflows)

 

    

 

 12 

 

  

 

    

 

 15 

 

  

 

    

 

 (1)

 

  

 

      

Liquidity products

 

    

 

 – 

 

  

 

    

 

 (6)

 

  

 

    

 

 12 

 

  

 

      

Total AUS net inflows / (outflows)

 

    

 

 12 

 

  

 

    

 

 9 

 

  

 

    

 

 11 

 

  

 

      

Net market appreciation / (depreciation)

 

    

 

 23 

 

  

 

    

 

 13 

 

  

 

    

 

 38 

 

  

 

      

Ending balance

 

    

 

 $            672 

 

  

 

    

 

 $            637 

 

  

 

    

 

 $            558 

 

  

 

      
               

 

FIRMWIDE

 

                              

Beginning balance

 

    

 

 $        2,204 

 

  

 

    

 

 $        2,145 

 

  

 

    

 

 $        1,818 

 

  

 

      

Net inflows / (outflows):

 

              

Alternative investments

 

    

 

 8 

 

  

 

    

 

 5 

 

  

 

    

 

 (2)

 

  

 

      

Equity

 

    

 

 3 

 

  

 

    

 

 14 

 

  

 

    

 

 2 

 

  

 

      

Fixed income

 

    

 

 11 

 

  

 

    

 

 18 

 

  

 

    

 

 6 

 

  

 

      

Total long-term AUS net inflows / (outflows)

 

    

 

 22 

 

  

 

    

 

 37 

 

  

 

    

 

 6 

 

  

 

      

Liquidity products

 

    

 

 16 

 

  

 

    

 

 23 

 

  

 

    

 

 133 

 

  

 

      

Total AUS net inflows / (outflows)

 

    

 

 38 

 

  

 

    

 

 60 

 

  

 

    

 

 139 

 

  

 

      

Net market appreciation / (depreciation)

 

    

 

 63 

 

  

 

    

 

 (1)

 

  

 

    

 

 100 

 

  

 

      

Ending balance

 

    

 

 $        2,305 

 

  

 

    

 

 $        2,204 

 

  

 

    

 

 $        2,057 

 

  

 

      

 

12

Goldman Sachs Reports

Second Quarter 2021 Earnings Results

 

 

Footnotes

    

 

  1.

Annualized ROE is calculated by dividing annualized net earnings applicable to common shareholders by average monthly common shareholders’ equity. Annualized ROTE is calculated by dividing annualized net earnings applicable to common shareholders by average monthly tangible common shareholders’ equity (tangible common shareholders’ equity is calculated as total shareholders’ equity less preferred stock, goodwill and identifiable intangible assets). Management believes that ROTE is meaningful because it measures the performance of businesses consistently, whether they were acquired or developed internally, and that tangible common shareholders’ equity is meaningful because it is a measure that the firm and investors use to assess capital adequacy. ROTE and tangible common shareholders’ equity are non-GAAP measures and may not be comparable to similar non-GAAP measures used by other companies.

 

The table below presents a reconciliation of average common shareholders’ equity to average tangible common shareholders’ equity:

 

   
     AVERAGE FOR THE        
   
Unaudited, $ in millions  

 THREE MONTHS ENDED 

JUNE 30, 2021

    

    

    SIX MONTHS ENDED 
JUNE 30, 2021		         

 

Total shareholders’ equity

 

    

 

 $            99,294 

 

  

 

      

 

 $            97,735 

 

  

 

  

Preferred stock

 

    

 

 (9,203)

 

  

 

      

 

 (9,489)

 

  

 

  

 

Common shareholders’ equity

 

    

 

 90,091 

 

  

 

        

 

 88,246 

 

  

 

  

 

Goodwill

    

 

 (4,332)

 

  

 

      

 

 (4,332)

 

  

 

  

Identifiable intangible assets

 

 

    

 

 (552)

 

  

 

      

 

 (581)

 

  

 

  

 

Tangible common shareholders’ equity

 

    

 

 $            85,207 

 

  

 

        

 

 $            83,333 

 

  

 

  

 

  2.

For information about the following items, see the referenced sections in Part I, Item 2 “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the firm’s Quarterly Report on Form 10-Q for the period ended March 31, 2021: (i) investment banking transaction backlog – see “Results of Operations – Investment Banking” (ii) assets under supervision – see “Results of Operations – Assets Under Supervision” (iii) efficiency ratio – see “Results of Operations – Operating Expenses” (iv) share repurchase program – see “Equity Capital Management and Regulatory Capital – Equity Capital Management” (v) global core liquid assets – see “Risk Management – Liquidity Risk Management” (vi) basic shares – see “Balance Sheet and Funding Sources – Balance Sheet Analysis and Metrics” and (vii) VaR – see “Risk Management – Market Risk Management.”

 

For information about the following items, see the referenced sections in Part I, Item 1 “Financial Statements (Unaudited)” in the firm’s Quarterly Report on Form 10-Q for the period ended March 31, 2021: (i) risk-based capital ratios and the supplementary leverage ratio – see Note 20 “Regulation and Capital Adequacy” (ii) geographic net revenues – see Note 25 “Business Segments” and (iii) unvested share-based awards that have non-forfeitable rights to dividends or dividend equivalents in calculating EPS – see Note 21 “Earnings Per Common Share.”

 

  3.

Dealogic – January 1, 2021 through June 30, 2021.

 

 

  4.

Represents a preliminary estimate for the second quarter of 2021 and may be revised in the firm’s Quarterly Report on Form 10-Q for the period ended June 30, 2021.

 

 

  5.

Effective April 1, 2021, the Federal Reserve’s temporary amendment permitting the exclusion of average holdings of U.S. Treasury securities and average deposits at the Federal Reserve from the calculation of the supplementary leverage ratio expired. The impact of this change was a decrease in the firm’s supplementary leverage ratio of approximately 0.8 percentage points.

 

13