EX-99.1 2 d377385dex991.htm EX-99.1 EX-99.1

Exhibit 99.1

 

LOGO

 

 

Third Quarter 2022

 

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              

 

   

Third Quarter 2022 Earnings Results

Goldman Sachs Reports Third Quarter Earnings Per Common Share of $8.25

 

 

“Goldman Sachs’ third quarter results reflect the strength, breadth and diversification of our global franchise. Against the backdrop of uncertainty and volatility in the markets, we continue to prudently manage our resources and remain focused on risk management as we serve our clients. Importantly, we are confident that our strategic evolution will drive higher, more durable returns and unlock long-term value for shareholders.

 

In January 2020, we outlined our strategy in clear and direct terms, introducing a plan to grow and strengthen our core businesses, diversify our products and services, and operate more efficiently as we drive higher, more durable returns. Today, we enter the next phase of our growth, introducing a realignment of our businesses that will enable us to further capitalize on the predominant operating model of One Goldman Sachs as we better serve our clients.”

 

- David Solomon, Chairman and Chief Executive Officer      

 

 

 

Financial Summary

 

 

 

     

    

     

  

 

Net Revenues

 

  

 

Net Earnings

 

  

 

EPS

 

 

3Q22                    $11.98 billion 

 

3Q22 YTD            $36.77 billion 

 

  

 

  3Q22                    $3.07 billion 

 

 3Q22 YTD             $9.94 billion 

 

  

 

3Q22                               $8.25 

 

3Q22 YTD                     $26.71 

 

 

    

        

 

Annualized ROE1

 

    

 

Annualized  ROTE1

 

    

 

Book Value Per Share

 

 

3Q22                                 11.0% 

 

3Q22 YTD                        12.2% 

 

    

 

 3Q22                              12.0% 

 

 3Q22 YTD                      13.1% 

 

    

 

 3Q22                             $308.22 

 

 YTD Growth                     8.4% 

 

       

NEW YORK, October 18, 2022 – The Goldman Sachs Group, Inc. (NYSE: GS) today reported net revenues of $11.98 billion and net earnings of $3.07 billion for the third quarter ended September 30, 2022. Net revenues were $36.77 billion and net earnings were $9.94 billion for the first nine months of 2022.

Diluted earnings per common share (EPS) was $8.25 for the third quarter of 2022 compared with $14.93 for the third quarter of 2021 and $7.73 for the second quarter of 2022, and was $26.71 for the first nine months of 2022 compared with $48.59 for the first nine months of 2021.

Annualized return on average common shareholders’ equity (ROE)1 was 11.0% for the third quarter of 2022 and 12.2% for the first nine months of 2022. Annualized return on average tangible common shareholders’ equity (ROTE)1 was 12.0% for the third quarter of 2022 and 13.1% for the first nine months of 2022.

1      

 

Goldman Sachs Reports

Third Quarter 2022 Earnings Results

 

 

Highlights

 

 

  ◾  

During the quarter, the firm continued to support clients amid a challenging macroeconomic environment and generated solid quarterly net revenues of $11.98 billion, net earnings of $3.07 billion and diluted EPS of $8.25.

 

 

  ◾  

The firm ranked #1 in worldwide announced and completed mergers and acquisitions and in worldwide equity and equity-related offerings for the year-to-date.2

 

 

  ◾  

Global Markets generated quarterly net revenues of $6.20 billion, reflecting strong performances in both Fixed Income, Currency and Commodities (FICC) and Equities, particularly in financing.

 

 

  ◾  

Consumer & Wealth Management generated record quarterly net revenues of $2.38 billion, 18% higher than the third quarter of 2021.

 

 

  ◾  

Firmwide Management and other fees were a record $2.24 billion for the third quarter of 2022, 15% higher than the third quarter of 2021.

 

 

  ◾  

Book value per common share increased by 2.1% during the quarter and 8.4% during the first nine months of 2022 to $308.22.

 

 

 

Quarterly Net Revenue Mix by Segment

 

LOGO

2      

 

Goldman Sachs Reports

Third Quarter 2022 Earnings Results

 

 

Net Revenues

 

    

 

Net revenues were $11.98 billion for the third quarter of 2022, 12% lower than a strong third quarter of 2021 and 1% higher than the second quarter of 2022. The decrease compared with the third quarter of 2021 reflected significantly lower net revenues in Investment Banking and Asset Management, partially offset by higher net revenues in Global Markets and Consumer & Wealth Management.

       

 

Net Revenues

 

   

 

$11.98 billion

 

   
   

 

 

 

  

 

   Investment Banking  

 

  

 

  

 

Net revenues in Investment Banking were $1.58 billion for the third quarter of 2022, 57% lower than a strong third quarter of 2021 and 26% lower than the second quarter of 2022. The decrease compared with the third quarter of 2021 reflected significantly lower net revenues in Underwriting, Financial advisory and Corporate lending.

 

The decrease in Underwriting net revenues was due to significantly lower net revenues in both Equity and Debt underwriting, reflecting a significant decline in industry-wide volumes. The decrease in Financial advisory net revenues reflected a significant decline in industry-wide completed mergers and acquisitions transactions from elevated activity levels in the prior year period. The decrease in Corporate lending net revenues was primarily due to net mark-downs on acquisition financing activities and net losses on hedges.

 

The firm’s backlog3 was essentially unchanged compared with the end of the second quarter of 2022.

    

 

Investment Banking

 

   

 

$1.58 billion

 

      

 

Financial advisory

  

 

    $972 million 

   

Underwriting

  

    $569 million 

   

Corporate lending  

 

  

    $  35 million  

 

     
     
     
     
     
     

 

 

 

  

 

   Global Markets  

 

  

 

  

 

Net revenues in Global Markets were $6.20 billion for the third quarter of 2022, 11% higher than the third quarter of 2021 and 4% lower than the second quarter of 2022.

 

Net revenues in FICC were $3.53 billion, 41% higher than the third quarter of 2021, primarily reflecting significantly higher net revenues in FICC intermediation, driven by significantly higher net revenues in interest rate products and currencies, and higher net revenues in commodities and credit products, partially offset by significantly lower net revenues in mortgages. In addition, net revenues in FICC financing were significantly higher, primarily driven by repurchase agreements and mortgage lending.

 

Net revenues in Equities were $2.68 billion, 14% lower than a strong third quarter of 2021, primarily due to 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 slightly lower.

       

 

Global Markets

 

   

 

$6.20 billion

 

   

 

FICC intermediation

  

 

$2.80 billion  

   

FICC financing

  

$725 million  

   

FICC

  

$3.53 billion  

       
   

Equities intermediation

  

$1.55 billion  

   

Equities financing

  

$1.13 billion  

   

Equities

 

  

$2.68 billion  

 

     
     
     
     
     
     

3      

 

Goldman Sachs Reports

Third Quarter 2022 Earnings Results

 

 

      

 

   Asset Management  

 

       

 

Net revenues in Asset Management were $1.82 billion for the third quarter of 2022, 20% lower than the third quarter of 2021 and 68% higher than the second quarter of 2022. The decrease compared with the third quarter of 2021 primarily reflected significantly lower net revenues in Equity investments and Lending and debt investments, partially offset by significantly higher net revenues in Management and other fees.

 

The decrease in Equity investments net revenues reflected significantly lower net gains from investments in private equities, partially offset by mark-to-market net gains from investments in public equities compared with significant net losses in the third quarter of 2021. The decrease in Lending and debt investments net revenues primarily reflected net mark-downs compared with net mark-ups in the prior year period. Incentive fees were lower, driven by harvesting in the prior year period. The increase in Management and other fees reflected the inclusion of NN Investment Partners (NNIP) in the current period and the impact of fee waivers on money market funds in the prior year period.

    

 

Asset Management

   

 

$1.82 billion

 

   

 

Management and   other fees

   $1.03 billion  
   

Incentive fees

   $  36 million  
   

Equity investments

   $527 million  
 

  

  

Lending and debt

  investments

 

  

$231 million  

 

     
     
     
     
     
     

 

      

 

   Consumer & Wealth Management  

 

       

 

Net revenues in Consumer & Wealth Management were $2.38 billion for the third quarter of 2022, 18% higher than the third quarter of 2021 and 9% higher than the second quarter of 2022.

 

Net revenues in Wealth management were $1.63 billion, essentially unchanged compared with the third quarter of 2021, reflecting significantly lower Incentive fees, driven by harvesting in the prior year period, offset by significantly higher net revenues in Private banking and lending, due to the impact of higher loan and deposit balances. Management and other fees were essentially unchanged.

 

Net revenues in Consumer banking were $744 million, nearly double the amount in the third quarter of 2021, primarily reflecting significantly higher credit card balances and higher deposit spreads.

    

 

Consumer &

Wealth Management

   

 

$2.38 billion

 

   

 

Wealth management

 

   $1.63 billion  
   

Consumer banking

 

  

$744 million  

 

     
     
     
     
     

 

 

Provision for Credit Losses

 

Provision for credit losses was $515 million for the third quarter of 2022, compared with $175 million in the third quarter of 2021 and $667 million in the second quarter of 2022. Provisions for the third quarter of 2022 reflected consumer portfolio growth, net charge-offs and the impact of continued broad concerns on the macroeconomic outlook. The third quarter of 2021 primarily reflected provisions related to portfolio growth (primarily in credit cards).

 

The firm’s allowance for credit losses was $5.59 billion as of September 30, 2022.

  

  

  

 

Provision for Credit Losses

   

 

$515 million

 

   
   
   
   
   
   
   
   

4      

 

Goldman Sachs Reports

Third Quarter 2022 Earnings Results

 

 

Operating Expenses

 

 

Operating expenses were $7.70 billion for the third quarter of 2022, 17% higher than the third quarter of 2021 and 1% higher than the second quarter of 2022. The firm’s efficiency ratio3 for the first nine months of 2022 was 62.7%, compared with 52.8% for the first nine months of 2021.

 

  

  

  

 

Operating Expenses

 

 

 

$7.70 billion

 

 

The increase in operating expenses compared with the third quarter of 2021 included higher compensation and benefits expenses (reflecting a smaller reduction in the year- to-date ratio of compensation and benefits to net revenues, net of provision for credit losses, compared with the prior year period), the inclusion of NNIP and GreenSky, Inc., higher net provisions for litigation and regulatory proceedings, and higher transaction based expenses.

 

Net provisions for litigation and regulatory proceedings for the third quarter of 2022 were $191 million compared with $52 million for the third quarter of 2021.

 

Headcount increased 4% compared with the end of the second quarter of 2022, primarily reflecting the timing of campus hires and investments in growth initiatives.

 

  

 

YTD Efficiency Ratio

 

 

 

62.7%

 

 
 
   
   
   
   
   
   
   

 

Provision for Taxes

 

 

The effective income tax rate for the first nine months of 2022 increased to 16.9% from 16.3% for the first half of 2022, primarily due to a decrease in the impact of tax benefits on the settlement of employee share-based awards in the first nine months of 2022 compared with the first half of 2022.

    

 

    
 

 

YTD Effective Tax Rate

 

 

 

16.9%

 

 
   
   

 

 

Other Matters

 

 

◾ On October 17, 2022, the Board of Directors of The Goldman Sachs Group, Inc. declared a dividend of $2.50 per common share to be paid on December 29, 2022 to common shareholders of record on December 1, 2022.

 

◾ During the quarter, the firm returned $1.89 billion of capital to common shareholders, including $1.00 billion of common share repurchases (3.0 million shares at an average cost of $332.32) and $893 million of common stock dividends.3

 

◾   Global core liquid assets3 averaged $417 billion4 for the third quarter of 2022, compared with an average of $391 billion for the second quarter of 2022.

  

 

  

Declared Quarterly

Dividend Per Common Share

 

 

 

$2.50

 

 
 

 

Common Share Repurchases

 

 

 

3.0 million shares for $1.00 billion

 

   
   

 

Average GCLA

 

   

 

$417 billion

 

5      

 

Goldman Sachs Reports

Third Quarter 2022 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, 2021.

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 and future results 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 or worsening of hostilities, including the escalation or continuation of the war between Russia and Ukraine, continuing 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, 2021.

 

        

 

   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 1-800-753-0786 (in the U.S.) or 1-323-794-2410 (outside the U.S.) passcode number 7042022. 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 1-888-203-1112 (in the U.S.) or 1-  719-457-0820 (outside the U.S.) passcode number 7042022 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

Third Quarter 2022 Earnings Results

 

The Goldman Sachs Group, Inc. and Subsidiaries

Segment Net Revenues (unaudited)

$ in millions

 

     
     THREE MONTHS ENDED           % CHANGE FROM  
         
     SEPTEMBER 30,
2022		     JUNE 30,
2022		     SEPTEMBER 30,
2021		              JUNE 30,
2022		     SEPTEMBER 30,
2021		  

 

INVESTMENT BANKING

 

                                          

Financial advisory

     $             972         $          1,197         $              1,648                                 (19) %                            (41) %  
                 

Equity underwriting

     241         131         1,174            84            (79)      

Debt underwriting

 

    

 

 328  

 

  

 

    

 

 457  

 

  

 

    

 

 726   

 

  

 

      

 

 (28)    

 

  

 

    

 

 (55)    

 

  

 

Underwriting

     569         588         1,900            (3)           (70)      
                 

Corporate lending

 

    

 

 35  

 

  

 

    

 

 352  

 

  

 

    

 

 152   

 

  

 

      

 

 (90)    

 

  

 

    

 

 (77)    

 

  

 

 

Net revenues

 

    

 

 1,576  

 

  

 

    

 

 2,137  

 

  

 

    

 

 3,700   

 

  

 

      

 

 (26)    

 

  

 

    

 

 (57)    

 

  

 

                 

 

GLOBAL MARKETS

 

                                          

 

FICC intermediation

     2,800         2,839         1,995            (1)           40       

FICC financing

 

    

 

 725  

 

  

 

    

 

 768  

 

  

 

    

 

 513   

 

  

 

      

 

 (6)    

 

  

 

    

 

 41     

 

  

 

FICC

     3,525         3,607         2,508            (2)           41       
                 

Equities intermediation

     1,549         1,734         1,920            (11)           (19)      

 

Equities financing

    

 

 1,127  

 

  

 

    

 

 1,126  

 

  

 

    

 

 1,183   

 

  

 

      

 

 –     

 

  

 

    

 

 (5)    

 

  

 

 

Equities

 

    

 

 2,676  

 

  

 

    

 

 2,860  

 

  

 

    

 

 3,103   

 

  

 

      

 

 (6)    

 

  

 

    

 

 (14)    

 

  

 

Net revenues

 

    

 

 6,201  

 

  

 

    

 

 6,467  

 

  

 

    

 

 5,611   

 

  

 

      

 

 (4)    

 

  

 

    

 

 11     

 

  

 

                 

 

ASSET MANAGEMENT

 

                                          

 

Management and other fees

     1,027         1,008         724            2            42       

 

Incentive fees

 

    

 

 36  

 

  

 

    

 

 160  

 

  

 

    

 

 100   

 

  

 

      

 

 (78)    

 

  

 

    

 

 (64)    

 

  

 

Equity investments

     527         (221)        935            N.M.            (44)      

 

Lending and debt investments

 

    

 

 231  

 

  

 

    

 

 137  

 

  

 

    

 

 520   

 

  

 

      

 

 69     

 

  

 

    

 

 (56)    

 

  

 

Net revenues

 

    

 

 1,821  

 

  

 

    

 

 1,084  

 

  

 

    

 

 2,279   

 

  

 

      

 

 68     

 

  

 

    

 

 (20)    

 

  

 

                 

 

CONSUMER & WEALTH MANAGEMENT

 

                                          

 

Management and other fees

     1,217         1,224         1,223            (1)           –       

 

Incentive fees

     21         24         121            (13)           (83)      

 

Private banking and lending

 

    

 

 395  

 

  

 

    

 

 320  

 

  

 

    

 

 292   

 

  

 

      

 

 23     

 

  

 

    

 

 35     

 

  

 

Wealth management

     1,633         1,568         1,636            4            –       
                 

Consumer banking

 

    

 

 744  

 

  

 

    

 

 608  

 

  

 

    

 

 382   

 

  

 

      

 

 22     

 

  

 

    

 

 95     

 

  

 

Net revenues

 

    

 

 2,377  

 

  

 

    

 

 2,176  

 

  

 

    

 

 2,018   

 

  

 

      

 

 9     

 

  

 

    

 

 18     

 

  

 

                 

 

Total net revenues

 

    

 

 $        11,975  

 

  

 

    

 

 $        11,864  

 

  

 

    

 

 $            13,608   

 

  

 

      

 

 1     

 

  

 

    

 

 (12)    

 

  

 

 

Geographic Net Revenues (unaudited)3

 

          
$ in millions            
   
     THREE MONTHS ENDED                    
     
     SEPTEMBER 30,
2022		     JUNE 30,
2022		     SEPTEMBER 30,
2021		                       

 

Americas

     $          7,542         $          7,047         $              8,169           

 

EMEA

     3,094         3,400         3,394           

 

Asia

 

    

 

 1,339  

 

  

 

    

 

 1,417  

 

  

 

    

 

 2,045   

 

  

 

      

Total net revenues

 

    

 

 $        11,975  

 

  

 

    

 

 $        11,864  

 

  

 

    

 

 $            13,608   

 

  

 

      
               

Americas

     63%        59%        60%        

 

EMEA

     26%        29%        25%        

 

Asia

 

    

 

 11% 

 

  

 

    

 

 12% 

 

  

 

    

 

 15%

 

  

 

      

Total

 

    

 

 100% 

 

  

 

    

 

 100% 

 

  

 

    

 

 100%

 

  

 

      

 

7

Goldman Sachs Reports

Third Quarter 2022 Earnings Results

 

The Goldman Sachs Group, Inc. and Subsidiaries

Segment Net Revenues (unaudited)

$ in millions

 

     
     NINE MONTHS ENDED          % CHANGE FROM                                 
     
    

SEPTEMBER 30,

2022

    

SEPTEMBER 30,

2021

           

SEPTEMBER 30,

2021

      

 

INVESTMENT BANKING

 

                            

 

Financial advisory

     $           3,296          $           4,022            (18) %    
               

Equity underwriting

     633          3,986            (84)        

 

Debt underwriting

     1,528          2,556            (40)        

 

Underwriting

     2,161          6,542            (67)        
               

 

Corporate lending

 

    

 

 667   

 

  

 

    

 

 516   

 

  

 

      

 

 29     

 

  

 

  

 

Net revenues

 

    

 

 6,124   

 

  

 

    

 

 11,080   

 

  

 

      

 

 (45)    

 

  

 

  
               

 

GLOBAL MARKETS

 

                            

 

FICC intermediation

     9,677          7,343            32         

 

FICC financing

     2,178          1,378            58         

 

FICC

     11,855          8,721            36         
               

Equities intermediation

     5,444          6,271            (13)        

 

Equities financing

     3,241          3,100            5         

 

Equities

 

    

 

 8,685   

 

  

 

    

 

 9,371   

 

  

 

      

 

 (7)    

 

  

 

  

 

Net revenues

 

    

 

 20,540   

 

  

 

    

 

 18,092   

 

  

 

      

 

 14     

 

  

 

  
               

 

ASSET MANAGEMENT

 

                            

 

Management and other fees

     2,807          2,144            31         

 

Incentive fees

     248          220            13         

 

Equity investments

     (61)         7,772            N.M.         

 

Lending and debt investments

 

     457          1,889            (76)        

 

Net revenues

 

    

 

 3,451   

 

  

 

    

 

 12,025   

 

  

 

      

 

 (71)    

 

  

 

  
               

 

CONSUMER & WEALTH MANAGEMENT

 

                            

 

Management and other fees

     3,696          3,409            8         

 

Incentive fees

     72          162            (56)        

 

Private banking and lending

     1,054          816            29         

 

Wealth management

     4,822          4,387            10         
               

Consumer banking

 

    

 

 1,835   

 

  

 

    

 

 1,116   

 

  

 

      

 

 64     

 

  

 

  

 

Net revenues

 

    

 

 6,657   

 

  

 

    

 

 5,503   

 

  

 

      

 

 21     

 

  

 

  
               

 

Total net revenues

 

    

 

 $         36,772   

 

  

 

    

 

 $         46,700   

 

  

 

      

 

 (21)    

 

  

 

  

 

Geographic Net Revenues (unaudited)3

$ in millions

 

 

 

        
   
     NINE MONTHS ENDED                
     
    

SEPTEMBER 30,

2022

    

SEPTEMBER 30,

2021

                

Americas

     $         21,975          $         28,951            

 

EMEA

     10,344          11,585            

 

Asia

 

    

 

 4,453   

 

  

 

    

 

 6,164    

 

  

 

      

 

Total net revenues

 

    

 

 $         36,772   

 

  

 

    

 

 $         46,700    

 

  

 

      
             

Americas

     60%        62%         

 

EMEA

     28%        25%         

 

Asia

 

    

 

 12% 

 

  

 

    

 

 13% 

 

  

 

      

 

Total

 

    

 

 100% 

 

  

 

    

 

 100% 

 

  

 

      

 

8

Goldman Sachs Reports

Third Quarter 2022 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           
       
    

SEPTEMBER 30,

2022

    

     JUNE 30,     

2022

    

    SEPTEMBER 30,    

2021

         

     JUNE 30,     

2022

    

SEPTEMBER 30,

2021

        

REVENUES

 

                                                  

Investment banking

 

     $        1,541        $          1,785        $           3,548            (14 ) %      (57 ) %   

Investment management

 

     2,276        2,393        2,139            (5 )         6         

Commissions and fees

 

     995        1,073        860            (7 )          16         

Market making

 

     4,642        4,929        3,929            (6 )          18         

Other principal transactions

 

 

    

 

 478

 

   

 

    

 

 (50

 

 ) 

 

    

 

 1,568  

 

  

 

       

 

 N.M

 

 .      

 

    

 

 (70

 

 )     

 

  

Total non-interest revenues

 

    

 

 9,932

 

   

 

    

 

 10,130

 

   

 

    

 

 12,044  

 

  

 

       

 

 (2

 

 )     

 

    

 

 (18

 

 )     

 

  
                    

Interest income

 

     8,550        4,851        3,117            76            174         

Interest expense

 

    

 

 6,507

 

   

 

    

 

 3,117

 

   

 

    

 

 1,553  

 

  

 

       

 

 109

 

       

 

    

 

 319

 

       

 

  

Net interest income

 

    

 

 2,043

 

   

 

    

 

 1,734

 

   

 

    

 

 1,564  

 

  

 

       

 

 18

 

       

 

    

 

 31

 

       

 

  
                    

 

 

Total net revenues

 

    

 

 11,975

 

   

 

    

 

 11,864

 

   

 

    

 

 13,608  

 

  

 

       

 

 1

 

       

 

    

 

 (12

 

 )     

 

  
                    

 

Provision for credit losses

 

    

 

 515

 

   

 

    

 

 667

 

   

 

    

 

 175  

 

  

 

       

 

 (23

 

 )     

 

    

 

 194

 

       

 

  
                    

 

OPERATING EXPENSES

 

                                             

Compensation and benefits

 

     3,606        3,695        3,167            (2 )          14         

Transaction based

 

     1,317        1,317        1,139            –            16         

Market development

 

     199        235        165            (15 )          21         

Communications and technology

 

     459        444        397            3            16         

Depreciation and amortization

 

     666        570        509            17            31         

Occupancy

 

     255        259        239            (2 )          7         

Professional fees

 

     465        490        433            (5 )          7         

Other expenses

 

    

 

 737

 

   

 

    

 

 643

 

   

 

    

 

 542  

 

  

 

       

 

 15

 

       

 

    

 

 36

 

       

 

  

Total operating expenses

 

    

 

 7,704

 

   

 

    

 

 7,653

 

   

 

    

 

 6,591  

 

  

 

       

 

 1

 

       

 

    

 

 17

 

  

 

  
                    

Pre-tax earnings

 

     3,756        3,544        6,842            6            (45 )       

Provision for taxes

 

    

 

 687

 

   

 

    

 

 617

 

   

 

    

 

 1,464  

 

  

 

       

 

 11

 

       

 

    

 

 (53

 

 )     

 

  

Net earnings

 

    

 

 3,069

 

   

 

    

 

 2,927

 

   

 

    

 

 5,378  

 

  

 

       

 

 5

 

       

 

    

 

 (43

 

 )     

 

  

Preferred stock dividends

 

    

 

 107

 

   

 

    

 

 141

 

   

 

    

 

 94  

 

  

 

       

 

 (24

 

 )     

 

    

 

 14

 

       

 

  

Net earnings applicable to common shareholders

 

    

 

 $        2,962

 

   

 

    

 

 $          2,786

 

   

 

    

 

 $           5,284  

 

  

 

       

 

 6

 

       

 

    

 

 (44

 

 )     

 

  
                    

 

EARNINGS PER COMMON SHARE

 

                                             

Basic3

 

     $          8.35        $            7.81        $           15.14            7  %      (45 ) %   

Diluted

 

     $          8.25        $            7.73        $           14.93            7            (45 )       
                         

 

AVERAGE COMMON SHARES

 

                                             

Basic

 

     352.8        355.0        348.3            (1 )          1         

Diluted

 

     359.2        360.5        353.9            –            1         
                    

 

SELECTED DATA AT PERIOD-END

 

                                             

Common shareholders’ equity

 

     $    108,587        $      107,168        $         96,344            1            13         

Basic shares3

 

     352.3        355.0        347.5            (1 )          1         

Book value per common share

 

     $      308.22        $        301.88        $         277.25            2            11         
                    

Headcount

 

    

 

 49,100

 

   

 

    

 

 47,000

 

   

 

    

 

 43,000  

 

  

 

       

 

 4

 

       

 

    

 

 14

 

       

 

  

 

9

Goldman Sachs Reports

Third Quarter 2022 Earnings Results

 

The Goldman Sachs Group, Inc. and Subsidiaries

Consolidated Statements of Earnings (unaudited)

In millions, except per share amounts

 

     
     NINE MONTHS ENDED           % CHANGE FROM        
     
    

    SEPTEMBER 30,    

2022

    

    SEPTEMBER 30,    

2021

    

    

    

SEPTEMBER 30,

2021

    

                             

  

REVENUES

 

                            

Investment banking

 

     $           5,457        $          10,564           (48) %    

Investment management

 

     6,733        5,840           15         

Commissions and fees

 

     3,079        2,766           11         

Market making

 

     15,561        13,096           19         

Other principal transactions

 

 

    

 

 338 

 

  

 

    

 

 9,759  

 

  

 

      

 

 (97)    

 

  

 

  

Total non-interest revenues

 

    

 

 31,168 

 

  

 

    

 

 42,025  

 

  

 

      

 

 (26)    

 

  

 

  
               

Interest income

 

     16,613        9,110           82         

Interest expense

 

 

    

 

 11,009 

 

  

 

    

 

 4,435  

 

  

 

      

 

 148     

 

  

 

  

Net interest income

 

    

 

 5,604 

 

  

 

    

 

 4,675  

 

  

 

      

 

 20     

 

  

 

  
               

Total net revenues

 

    

 

 36,772 

 

  

 

    

 

 46,700  

 

  

 

      

 

 (21)    

 

  

 

  
               

Provision for credit losses

 

    

 

 1,743 

 

  

 

    

 

 13  

 

  

 

      

 

 N.M.     

 

  

 

  
               

 

OPERATING EXPENSES

 

                            

Compensation and benefits

 

     11,384        14,473           (21)        

Transaction based

 

     3,878        3,520           10         

Market development

 

     596        360           66         

Communications and technology

 

     1,327        1,143           16         

Depreciation and amortization

 

     1,728        1,527           13         

Occupancy

 

     765        727           5         

Professional fees

 

     1,392        1,137           22         

Other expenses

 

    

 

 2,003 

 

  

 

    

 

 1,781  

 

  

 

      

 

 12     

 

  

 

  

 

Total operating expenses

 

    

 

 23,073 

 

  

 

    

 

 24,668  

 

  

 

      

 

 (6)    

 

  

 

  
               

Pre-tax earnings

 

     11,956        22,019           (46)        

Provision for taxes

 

     2,021        4,319           (53)        

 

Net earnings

 

     9,935        17,700           (44)        

Preferred stock dividends

 

 

     356        358           (1)        

Net earnings applicable to common shareholders

 

     $           9,579        $          17,342           (45)        
               

EARNINGS PER COMMON SHARE

 

                            

Basic3

     $           27.03        $            49.23           (45) %    

 

Diluted

     $           26.71        $            48.59           (45)        
               

AVERAGE COMMON SHARES

 

                            

Basic

 

     353.0        351.8           –         

Diluted

 

     358.6        356.9           –         

 

10

Goldman Sachs Reports

Third Quarter 2022 Earnings Results

 

The Goldman Sachs Group, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets (unaudited)4

$ in billions

 

   
     AS OF                     
   
    

SEPTEMBER 30,

2022

    

JUNE 30,

2022

    

    

  

                    

                        

                    

 

ASSETS

 

                        

 

Cash and cash equivalents

     $             284         $             288            

 

Collateralized agreements

     380         448            

 

Customer and other receivables

     166         163            

 

Trading assets

     384         372            

 

Investments

     127         115            

 

Loans

     177         176            

 

Other assets

 

     39         39            

 

Total assets

 

  

 

 

 

 

$          1,557  

 

 

 

 

  

 

 

 

 

$          1,601  

 

 

 

 

        
               

 

LIABILITIES AND SHAREHOLDERS’ EQUITY

 

                        

 

Deposits

     $             395         $             391            

 

Collateralized financings

     219         228            

 

Customer and other payables

     279         280            

 

Trading liabilities

     232         255            

 

Unsecured short-term borrowings

     52         58            

 

Unsecured long-term borrowings

     240         251            

 

Other liabilities

     21         20            

 

Total liabilities

 

  

 

 

 

 

1,438  

 

 

 

 

  

 

 

 

 

1,483  

 

 

 

 

        

 

Shareholders’ equity

 

     119         118            

 

Total liabilities and shareholders’ equity

 

  

 

 

 

 

$          1,557  

 

 

 

 

  

 

 

 

 

$          1,601  

 

 

 

 

        

 

Capital Ratios and Supplementary Leverage Ratio (unaudited)3,4

$ in billions

 

 

 

        
   
     AS OF                      
   
    

SEPTEMBER 30,

2022

    

JUNE 30,

2022

                  

 

Common equity tier 1 capital

     $            98.7         $            98.3            
               

 

STANDARDIZED CAPITAL RULES

 

                        

 

Risk-weighted assets

     $             689         $             692            

 

Common equity tier 1 capital ratio

     14.3%       14.2%          
               

 

ADVANCED CAPITAL RULES

 

                        

 

Risk-weighted assets

     $             675         $             686            

 

Common equity tier 1 capital ratio

     14.6%       14.3%          
               

 

SUPPLEMENTARY LEVERAGE RATIO

 

                        

 

Supplementary leverage ratio

 

     5.6%       5.6%          

 

Average Daily VaR (unaudited)3,4

$ in millions

 

 

        
   
     THREE MONTHS ENDED                      
   
    

SEPTEMBER 30,

2022

    

JUNE 30,

2022

                  

 

RISK CATEGORIES

 

                        

 

Interest rates

     $           112         $             104            

 

Equity prices

     34         36            

 

Currency rates

     36         23            

 

Commodity prices

     51         63            

 

Diversification effect

     (103)        (102)           

 

 

Total

 

  

 

 

 

 

$           130  

 

 

 

 

  

 

 

 

 

$             124  

 

 

 

 

        

 

11

Goldman Sachs Reports

Third Quarter 2022 Earnings Results

 

The Goldman Sachs Group, Inc. and Subsidiaries

Assets Under Supervision (unaudited)3,4

$ in billions

 

   
     AS OF                                                                 
   
    

    SEPTEMBER 30,    

2022

    

    JUNE 30,    

2022

    

 SEPTEMBER 30, 

2021

                    

 

SEGMENT

 

                              

Asset Management

 

    

 

 $        1,760 

 

  

 

    

 

 $        1,824 

 

  

 

    

 

 $        1,678 

 

  

 

      

Consumer & Wealth Management

 

    

 

 667 

 

  

 

    

 

 671 

 

  

 

    

 

 694 

 

  

 

      

Total AUS

 

    

 

 $        2,427 

 

  

 

    

 

 $        2,495 

 

  

 

    

 

 $        2,372 

 

  

 

      
               

 

ASSET CLASS

 

                              

Alternative investments

 

    

 

 $           256 

 

  

 

    

 

 $           254 

 

  

 

    

 

 $           224 

 

  

 

      

Equity

 

    

 

 516 

 

  

 

    

 

 552 

 

  

 

    

 

 569 

 

  

 

      

Fixed income

 

    

 

 955 

 

  

 

    

 

 1,007 

 

  

 

    

 

 940 

 

  

 

      

Total long-term AUS

 

    

 

 1,727 

 

  

 

    

 

 1,813 

 

  

 

    

 

 1,733 

 

  

 

      

Liquidity products

 

    

 

 700 

 

  

 

    

 

 682 

 

  

 

    

 

 639 

 

  

 

      

Total AUS

 

    

 

 $        2,427 

 

  

 

    

 

 $        2,495 

 

  

 

    

 

 $        2,372 

 

  

 

      
           
   
     THREE MONTHS ENDED                    
   
    

SEPTEMBER 30,

2022

    

JUNE 30,

2022

    

SEPTEMBER 30,

2021

                    

 

ASSET MANAGEMENT

 

                              

Beginning balance

 

    

 

 $        1,824 

 

  

 

    

 

 $        1,656 

 

  

 

    

 

 $        1,633 

 

  

 

      

Net inflows / (outflows):

 

              

Alternative investments

    

 

 (2)

 

  

 

    

 

 3 

 

  

 

    

 

 3 

 

  

 

      

Equity

    

 

 (4)

 

  

 

    

 

 (2)

 

  

 

    

 

 3 

 

  

 

      

Fixed income

    

 

 (1)

 

  

 

    

 

 (2)

 

  

 

    

 

 27 

 

  

 

      

Total long-term AUS net inflows / (outflows)

    

 

 (7)

 

  

 

    

 

 (1)

 

  

 

    

 

 33 

 

  

 

      

Liquidity products

    

 

 14 

 

  

 

    

 

 6 

 

  

 

    

 

 11 

 

  

 

      

Total AUS net inflows / (outflows)

    

 

 7 

 

  

 

    

 

 5 

 

  

 

    

 

 44 

 

  

 

      

Acquisitions / (dispositions)

    

 

 6 

 

  

 

    

 

 305 

 

  

 

    

 

 – 

 

  

 

      

Net market appreciation / (depreciation)

    

 

 (77)

 

  

 

    

 

 (142)

 

  

 

    

 

 1 

 

  

 

      

Ending balance

 

    

 

 $        1,760 

 

  

 

    

 

 $        1,824 

 

  

 

    

 

 $        1,678 

 

  

 

      
               

 

CONSUMER & WEALTH MANAGEMENT

 

                              

Beginning balance

 

    

 

 $           671 

 

  

 

    

 

 $           738 

 

  

 

    

 

 $           672 

 

  

 

      

Net inflows / (outflows):

 

              

Alternative investments

 

    

 

 9 

 

  

 

    

 

 1 

 

  

 

    

 

 6 

 

  

 

      

Equity

 

    

 

 2 

 

  

 

    

 

 3 

 

  

 

    

 

 9 

 

  

 

      

Fixed income

 

    

 

 5 

 

  

 

    

 

 (1)

 

  

 

    

 

 1 

 

  

 

      

Total long-term AUS net inflows / (outflows)

 

    

 

 16 

 

  

 

    

 

 3 

 

  

 

    

 

 16 

 

  

 

      

Liquidity products

 

    

 

 4 

 

  

 

    

 

 (13)

 

  

 

    

 

 6 

 

  

 

      

Total AUS net inflows / (outflows)

 

    

 

 20 

 

  

 

    

 

 (10)

 

  

 

    

 

 22 

 

  

 

      

Acquisitions / (dispositions)

 

    

 

 (2)

 

  

 

    

 

 – 

 

  

 

    

 

 – 

 

  

 

      

Net market appreciation / (depreciation)

 

    

 

 (22)

 

  

 

    

 

 (57)

 

  

 

    

 

 – 

 

  

 

      

Ending balance

 

    

 

 $           667 

 

  

 

    

 

 $           671 

 

  

 

    

 

 $           694 

 

  

 

      
               

 

FIRMWIDE

 

                              

Beginning balance

 

    

 

 $        2,495 

 

  

 

    

 

 $        2,394 

 

  

 

    

 

 $        2,305 

 

  

 

      

Net inflows / (outflows):

 

              

Alternative investments

 

    

 

 7 

 

  

 

    

 

 4 

 

  

 

    

 

 9 

 

  

 

      

Equity

 

    

 

 (2)

 

  

 

    

 

 1 

 

  

 

    

 

 12 

 

  

 

      

Fixed income

 

    

 

 4 

 

  

 

    

 

 (3)

 

  

 

    

 

 28 

 

  

 

      

Total long-term AUS net inflows / (outflows)

 

    

 

 9 

 

  

 

    

 

 2 

 

  

 

    

 

 49 

 

  

 

      

Liquidity products

 

    

 

 18 

 

  

 

    

 

 (7)

 

  

 

    

 

 17 

 

  

 

      

Total AUS net inflows / (outflows)

 

    

 

 27 

 

  

 

    

 

 (5)

 

  

 

    

 

 66 

 

  

 

      

Acquisitions / (dispositions)

 

    

 

 4 

 

  

 

    

 

 305 

 

  

 

    

 

 – 

 

  

 

      

Net market appreciation / (depreciation)

 

    

 

 (99)

 

  

 

    

 

 (199)

 

  

 

    

 

 1 

 

  

 

      

Ending balance

 

    

 

 $        2,427 

 

  

 

    

 

 $        2,495 

 

  

 

    

 

 $        2,372 

 

  

 

      

 

12

Goldman Sachs Reports

Third Quarter 2022 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

SEPTEMBER 30, 2022

    

    

  

 NINE MONTHS ENDED 

SEPTEMBER 30, 2022

    

  

  

Total shareholders’ equity

 

    

 

 $            118,013 

 

  

 

      

 

 $            115,418 

 

  

 

  

Preferred stock

 

    

 

 (10,703)

 

  

 

      

 

 (10,703)

 

  

 

  

Common shareholders’ equity

 

    

 

 107,310 

 

  

 

        

 

 104,715 

 

  

 

  

Goodwill

    

 

 (6,242)

 

  

 

      

 

 (5,546)

 

  

 

  

Identifiable intangible assets

 

    

 

 (1,987)

 

  

 

      

 

 (1,463)

 

  

 

  

Tangible common shareholders’ equity

 

    

 

 $               99,081 

 

  

 

        

 

 $             97,706 

 

  

 

  

 

  2.

Dealogic – January 1, 2022 through September 30, 2022.

 

 

  3.

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 June 30, 2022: (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 “Capital Management and Regulatory Capital – 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 June 30, 2022: (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 basic EPS – see Note 21 “Earnings Per Common Share.”

 

 

  4.

Represents a preliminary estimate for the third quarter of 2022 and may be revised in the firm’s Quarterly Report on Form 10-Q for the period ended September 30, 2022.

 

13