Goldman Sachs takes a hit
Only this time last year, Goldman Sachs was announcing bumper profits. This week, it reported a huge 83% year-on-year drop in second quarter earnings, bringing the Wall Street party to an abrupt halt.
The party on Wall Street came to a juddering halt in the second quarter. US investment banks have reported sharp drops in revenue and earnings, with Wall Street's Goldman Sachs looking particularly off-form. It announced an 83% year-on-year drop in second-quarter earnings to $453m as revenue fell by 36% to $8.8bn.
The bottom-line figure factored in a $600m charge for the UK's new tax on bonuses and $550m to settle a charge that it misled investors when selling a structured credit product before the crunch. This is the biggest penalty ever extracted from a Wall Street firm by the Securities and Exchange Commission.
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