(Reuters) – Goldman Sachs Group Inc. on Tuesday reported a 19% drop in first-quarter profit as a sharp decline in deals eroded fees at its investment bank, while the partial sale of the portfolio lending from its Marcus consumer finance business continued to weigh on results.
Goldman Sachs posted a $470 million loss on the sale of Marcus as the bank restructures after a failed foray into retail banking.
The Wall Street giant overhauled its business last year, building on its traditional pillars of trading and investment banking, bolstering its asset management arm while stepping back from its retail banking aspirations.
“Events in the first quarter provided yet another real-life stress test,” chief executive David Solomon said in a statement on Tuesday.
The action of the bank fell by almost 3%, to 329 dollars, in the exchanges in forecourt.
Goldman Sachs’ profit fell to $3.09 billion (2.82 billion euros) for the quarter ended March 31, from $3.83 billion a year earlier.
Earnings per share fell to $8.79 from $10.76 a year ago.
Global M&A activity fell to its lowest level in more than a decade in the first quarter, according to Dealogic data, sending fees at Goldman Sachs’ investment bank down 26% to 1 .58 billion dollars.
The bank’s net banking income fell 5% to $12.22 billion.
Goldman Sachs’ results contrast with those of other US banks which reported better-than-expected quarterly performance on the back of rising interest rates.
(Reporting Niket Nishant and Noor Zainab Hussain in Bangalore and Nupur Anand in New York; written by Lananh Nguyen; Diana Mandiá, editing by Blandine Hénault)
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