Goldman Sachs has reported a bigger-than-expected 69 per cent slump in fourth-quarter profit as it struggled with a slump in dealmaking and weakness in its wealth management business.
Goldman’s Chief Executive Officer David Solomon refocuses the bank’s resources to strengthen its core businesses such as investment banking and trading as it is reported to curb its consumer banking ambitions.
For the last quarter, its investment banking fees dropped 48 per cent; while revenue from its asset and wealth management unit shrank 27 per cent due to lower revenue from equity and debt investments.
Goldman also posted a pre-tax loss of $778 million in its platform solutions unit, which houses transaction banking, credit card and financial technology businesses. According to its official statement, the full-year net loss for the platform solutions business was $1.67 billion.
Notably, provision for credit losses was $972 million for the fourth quarter of 2022, compared with $344 million a year earlier. As a result of this, Goldman is planning to stop making unsecured consumer loans, in another sign it was moving away from its consumer business.
