Goldman Sachs deserves hit by weakness in trading, underwriting by Reuters

(Reuters) – Goldman Sachs Group Inc (N 🙂 reported a better-than-expected quarterly earnings Tuesday As the Wall Street Investment Bank has benefited from higher stock trading and an increase in lending to its wealthy customers and companies.

The bank, as its competitors, faces more challenges in increasing its turnover in the face of increasing geopolitical uncertainties and concerns about the impact of future interest rate cuts by the US Federal Reserve.

Goldman also shifts its business model away from focus on trading to a more stable, consumer-focused revenue stream. [1[ads1]9659006] Revenue fell on three of the four large companies, with the largest decreases in trade and investment management.

Institutional customer revenue, which includes trading, declined 3%, while investment income was down 9%. Income from the bank's investment and lending activities increased by 16%.

"Given the strength of our client franchise, we are well positioned to take advantage of a growing global economy," CEO David Solomon said in a statement. 19659006] While revenues declined in the quarter, lower compensation costs gave some relief. Total operating expenses were almost flat at $ 6.12 billion.

The bank aims to generate $ 5 billion in new revenue by 2020 and is currently undergoing a front-to-back review of all its businesses that began in October last year when Solomon took control as CEO.

While the final strategy is not expected early next year, the bank has already made moves to expand its consumer department by increasing the online bank Marcus and launching a credit card with Apple Inc (O :). It was also announced in May to buy United Capital, a securities management company for United.

The bank's net income for public shareholders fell 6% to $ 2.20 billion in the quarter of June 30. Earnings per share fell to $ 5.81 from $ 5.98 a year before.

Total net income fell 2% to $ 9.46 billion.

Analysts had expected earnings of $ 4.89 per share and a turnover of $ 8.83 billion, according to IBES estimates from Refinitiv.

Goldman's main ranks Morgan Stanley (N 🙂 is expected to report quarterly results later this week.