NEW YORK (Reuters) - Goldman Sachs Group Inc. posted a 53% decrease in favour of the fourth quarter as commercial revenue dropped, dashing hopes that the Wall Street Bank had gone upstream of a difficult debt markets business climate.
Bond trading income including base and currencies, dragged 39 percent for the third quarter as concerns the European sovereign debt and increase yields of U.S. Treasury kept investors away.
"Things were just dead" in December, while "it's that much more active" in January, Chief Financial Officer David Viniar said in a telephone conference.
Profit fell for a third quarter right and income did not estimated decline of the year in banking investment and most of the other business segments. Viniar said backlog of investment bank Goldman business for the third quarter, which can curtail revenues in the current quarter.
Goldman shares fell 3%, on the actions of other banks.
"If Goldman Sachs cannot display performance solid, then good luck to anyone another attempt," said Simon Maughan, an analyst with MF Global in London.
Results plays a year that has tested Goldman Chief Executive Lloyd Blankfein and the reputation of the Bank for the smartest to Wall Street bankers.
Goldman has been criticized for activities such as management of an offer by company social networking Facebook Inc. and its marketing of a mortgage-linked which led him to pay $ 550 million to settle allegations of civil fraud from regulators in July.
Nevertheless, the company said that pay on close to 40 per cent of the income for the year in the form of compensation and benefits, a higher percentage than in 2009, although 2010 profit fell 37% and income decreased by 13%.
Compensation per employee fell by 14% to approximately $431,000.
DIFFICULT ENVIRONMENT
Quarterly net income after payment of dividends to preferred shares fell to 2.23 billion dollars, or $3.79 per share, of 4.79 billion dollars, or $8.20 per share, a year earlier. Net income has decreased 10% $ 8.64 billion.
Excluding one-time items, profit was $4.11 per share, according to Thomson Reuters I/B/E/S.On this basis, analysts expected income average of $3.76 per share on revenue of $ 9 billion.
"This is a very difficult environment," said Keith Davis, an analyst of Farr, Miller & Washington, who holds shares in Goldman. "Absence of what we saw of JPMorgan, Goldman results not would not have been a surprise." "JPMorgan raised the bar".
Citigroup Inc. and JPMorgan Chase & Co reported in the past week decreased from 58% and 8%, respectively, in fixed income securities quarterly income.
The results prompted questions about how much money banks can make bond trading in 2011. Fixed income accounted for approximately half of the income before the credit crunch, but it is supposed to account for less in the future.
Blankfein, said in a statement the Bank is "see signs of growth and economic activity" in 2011.
Viniar has refused to discuss the relationship of Goldman with Facebook, including his decision this week to limit investment private Facebook stock non-U.S. investors.
PAYMENT RATIO TO STUDENT
Bank of quarterly investment income fell 10 per cent from one year to 1.51 billion, while Goldman earned on Morgan Stanley's Crown as the top of mergers and acquisitions advice.
Goldman made more money to trade for its own account. Income investing and lending increased by 11% in the third quarter, represents 23% of the total net revenue.
Viniar said new regulations may limit some of the investment and bank lending.
The Bank said its average value at risk, or the amount that he could lose agenda for trade with a confidence level of 95% 100, 120 million, 1 percent in the third quarter and 34% less than a year earlier.
For all 2010 Goldman profit after dividends to preferred shares fell to 7.71 billion dollars, or $13.18 per share of 12.19 billion dollars, or $ 22.13. Net income fell to 39.16 45.17 billion billion.
Long known for generous paid places employees, said Goldman have benefits and total pay 5 per cent to 15.38 billion in 2010.
As a percentage of income, compensation and benefits totaled 39.3% in 2010, 35.8% in 2009, but more than 6 percentage points lower than the average of the last decade.
Goldman finished 2010 with 35,700 employees, 32 500 a year earlier, said Viniar staffing could grow by a percentage to be mid - to high - sales in 2011.
In afternoon trading, Goldman shares were $5.17 $169.51 at the New York Stock Exchange.
In spite of the weak, Goldman shares are much better than those of many rivals.
Its shares are back to levels they were when the financial crisis exploded in September 2008.
Shares of Morgan Stanley and Bank of America Corp., including the report of the results later this week, also fell on Wednesday. The Standard & Poor Financials Index fell by 1.7%.
(Additional reporting by Maria Aspan, Ben Berkowitz, Christian Plumb, Jonathan Spicer and Dan Wilchins in New York and Steven Slater in London; editing by John Wallace, Martin Howell)
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