Goldman Sachs’ (GS) Profit Slumps For Fourth Straight Quarter As Market Volatility Weighs On Trading, Investment Banking

The Goldman Sachs Group Inc.'s profit slumped for the fourth straight quarter as market volatility hit the investment bank's bond-trading and investment banking businesses.

Goldman, the last of the big U.S. banks to release first-quarter results, reported a 56.3 percent fall in net income applicable to common shareholders to $1.2 billion, or $2.68 per share, for the three-month period ended March 31.

That compared with $2.75 billion, or $5.94 per share, a year earlier, when the Wall Street bank recorded its best quarterly profit in five years.

Analysts on average had expected earnings of $2.45 per share, according to Thomson Reuters I/B/E/S. It was not immediately clear if the figures reported Tuesday were comparable.

As with other banks, Goldman's trading revenue was hit by sliding commodity and oil prices, worries about the Chinese economy and uncertainty about U.S. interest rates.

Revenue from trading bonds, currencies and commodities fell about 47 percent to $1.66 billion, accounting for 26.2 percent of total revenue in the quarter — a far cry from the 40 percent the business regularly contributed before the financial crisis.

Vining Sparks bank analyst Marty Mosby pointed to a convergence of revenue dropping and sequential growth in compensation at Goldman in the quarter.

“We had expenses going up and revenue going down, which is the squeeze we are seeing here in the first quarter,” he told CNBC Tuesday.

Goldman's traditional rival, Morgan Stanley, reported Monday a 54 percent drop in adjusted revenue from fixed income and commodities trading, and a similar drop in net profit.

Data from Reuters were used to report this story.