Goldman Sachs, a leading global investment bank, has released its fourth-quarter earnings report for 2023. According to the business data, Goldman Sachs' fourth-quarter revenue for the year reached $11.32 billion, surpassing the expected $10.8 billion. The net profit rose by 51% to $2.01 billion, and diluted earnings per common share (EPS) were $5.48, significantly higher than the same period a year ago, which was $3.32, and also exceeded analysts' forecasts. At the time of reporting, Goldman Sachs' stock price was up 0.99% at $381.49.
For the entire year of 2023, Goldman Sachs reported operating income of $46.25 billion, a 2% decrease from 2022, and a net income of $8.52 billion, which was down 24% year over year. It is noteworthy that this represents Goldman Sachs' nearly four-year low in profits since 2019, with the profit decline being second only to that of Citibank.
In 2023, the net income for Goldman Sachs' Global Banking and Markets was $30 billion, an 8% decrease from the previous year. Within this division, investment banking operating income was $6.22 billion, 16% lower than in 2022. This decline was due to a significant decrease in advisory net income and also reflected a downturn in the number of completed mergers and acquisitions across the industry.
The FICC division's net revenues were $12.06 billion, 18% below the figures for 2022. This was primarily due to a substantial decrease in net revenues from interest rate products and currencies, as well as a slight decrease in net revenues within the FICC financing business.
Equity Sales and Trading net revenues reached $11.55 billion, achieving a record high and marking a 5% increase over 2022. The firm ranked No. 1 globally in announced and completed mergers and acquisitions, equity and equity-related offerings, and common stock offerings.
Last year, Goldman Sachs concentrated on streamlining its strategy and aggressively expanding its core asset and wealth management divisions. Data indicate that the firm's Core Asset and Wealth Management division generated $4.39 billion in net income in the fourth quarter of 2023, which was 23% higher than the fourth quarter of 2022. This increase was attributed to higher income from equity and bond investments and higher management fees. For the full year of 2023, Core Asset and Wealth Management generated $13.88 billion in net income, which included record management and other fees, as well as record private banking revenues and net lending income.
It is important to note that in the fourth quarter of 2023, Goldman Sachs not only officially discontinued its retail consumer business with Apple but also sold GreenSky, a consumer lender, at a significant discount. The bank is making a concerted effort to grow its lending business for high-net-worth clients amidst a period where IPO, M&A, and dealmaking sentiment are relatively subdued.
Goldman Sachs' CEO has stated that the company will continue to mitigate the negative impact of ending its cooperation with Apple and expects that the "drag" from credit card partnerships will be significantly reduced in 2024.
Like its banking peers, Goldman Sachs paid $529 million to the Federal Deposit Insurance Corporation (FDIC) in response to the regional banking crisis in the United States. This FDIC special assessment was to recover losses to the Deposit Insurance Fund (DIF) resulting from the protection of uninsured depositors at Silicon Valley Bank and Signature Bank. Other banks contributed as follows: JPMorgan Chase paid $2.9 billion, Bank of America paid $2.1 billion, Wells Fargo paid $1.9 billion, Citibank paid $1.7 billion, and Morgan Stanley paid $286 million for this assessment.
Goldman Sachs also disclosed in its latest earnings report that the firm's headcount has decreased by 7% over the past year following a series of layoffs in 2023.
