Goldman revenue tops estimates, profit falls on legal costs

In this October 16, 2014, file photo, a screen at the NYSE is juxtaposed with the Goldman Sachs booth.

Goldman Sachs Group Inc.’s fourth quarter revenue beat analysts’ estimates as fees from advising on mergers jumped 27 percent. Net income dropped 65 percent on costs to settle a mortgage probe.
Revenue fell 5 percent to USD7.27 billion, better than the $7.17 billion estimate of 16 analysts surveyed by Bloomberg. Net income declined to $765 million, or $1.27 a share, from $2.17 billion, or $4.38, after an agreement to settle a U.S. probe into the bank’s handling of mortgage-backed securities reduced earnings by $1.54 billion, the New York-
based company said Wednesday in a statement.
Goldman Sachs’s merger-advisory business benefited from a record $3.8 trillion of deals globally in 2015, surpassing the previous record set in 2007, according to data compiled by Bloomberg. The firm said last week it reached a $5.1 billion agreement in principle on the mortgage case, cutting fourth- quarter profit and closing out a year of record legal and litigation costs.
“Our diversified business mix allowed us to deliver solid results in a year characterized by uneven global economic activity,” Chief Executive Officer Lloyd Blankfein said in the statement. “Our strong global client franchise leaves us well positioned to generate superior returns over the long term.”
Goldman Sachs shares fell 1.7 percent to $154.14 at 8:47 a.m. in New York. The stock had dropped 13 percent this year through Tuesday, trailing the 10 percent decline of the 88-company Standard & Poor’s 500 Financials Index.
On Tuesday, Morgan Stanley and Bank of America
Corp. said profit improved as expenses shrank. Cost cuts also bolstered results at JPMorgan Chase & Co. and Citigroup Inc., which reported earnings last week. Dakin Campbell,  Bloomberg