NEW YORK—Banking giants Bank of America Corp. and Goldman Sachs Group Inc. both reported weaker third-quarter earnings this week, as economic waters continue to be choppy for financial sector companies.
Earnings at Goldman, the nation’s top investment bank, fell to $1.9 billion, or $2.98 per share, a decline of around 40 percent from the same period last year.
“While economic conditions continue to be challenging in a number of important markets, our focus is on helping our clients achieve their goals,” said Goldman CEO Lloyd Blankfein in a statement.
For Goldman, proprietary trading income declined roughly 36 percent from the third quarter last year, reflecting smaller volume and low volatility, the company said this week. However, revenue from investment banking increased compared to last year.
Despite the lower profit, Goldman’s earnings beat analyst expectations.
Most of the loss was due to a one-time $10.4 billion write down in its credit card business, as new government rules regulating the credit card business set limits on certain fees, cutting into the bank’s revenues.
There was some good news, however. Bank of America said that delinquencies among consumers for mortgages and credit card debt declined. The bank released around $1.8 billion in reserves last quarter.
“We are adapting to the regulatory environment, credit quality continues to improve, and we are managing risk and building capital,” said Bank of America CEO Brian Moynihan in a statement. “We are realistic about the near-term challenges, and optimistic about the long-term opportunity.”
Earnings at Goldman, the nation’s top investment bank, fell to $1.9 billion, or $2.98 per share, a decline of around 40 percent from the same period last year.
“While economic conditions continue to be challenging in a number of important markets, our focus is on helping our clients achieve their goals,” said Goldman CEO Lloyd Blankfein in a statement.
For Goldman, proprietary trading income declined roughly 36 percent from the third quarter last year, reflecting smaller volume and low volatility, the company said this week. However, revenue from investment banking increased compared to last year.
Despite the lower profit, Goldman’s earnings beat analyst expectations.
Bank of America Misses View
Bank of America Corp., the nation’s biggest bank, missed Wall Street analysts’ expectations this week as it announced a staggering $7.3 billion quarterly loss.Most of the loss was due to a one-time $10.4 billion write down in its credit card business, as new government rules regulating the credit card business set limits on certain fees, cutting into the bank’s revenues.
There was some good news, however. Bank of America said that delinquencies among consumers for mortgages and credit card debt declined. The bank released around $1.8 billion in reserves last quarter.
“We are adapting to the regulatory environment, credit quality continues to improve, and we are managing risk and building capital,” said Bank of America CEO Brian Moynihan in a statement. “We are realistic about the near-term challenges, and optimistic about the long-term opportunity.”
