Goldman bond traders take shine off bumper quarter

{"text":[[{"start":7.99,"text":"Fixed income traders at Goldman Sachs suffered an unexpected drop in revenues at the start of 2026, taking the shine off the investment bank’s highest quarterly profits in five years."}],[{"start":21.42,"text":"The Wall Street bank reported first-quarter net income of $5.6bn, up 19 per cent from a year ago and better than the $5.3bn analysts had expected. "}],[{"start":33.7,"text":"The performance was powered by Goldman’s equities traders who delivered revenues of $5.3bn, ahead of the $4.9bn expected and up 27 per cent from a year ago as they benefited from wild market swings triggered by a series of geopolitical shocks. "}],[{"start":53.94,"text":"But the bank’s fixed income, currencies and commodities traders badly missed forecasts. The so-called Ficc business reported a 10 per cent drop in revenues to $4bn, rather than the 10 per cent increase analysts had priced in. "}],[{"start":71.34,"text":"Goldman blamed “significantly lower” net revenues in interest-rate products and mortgages for the decline. It said this was partially offset by commodities and currencies trading. "}],[{"start":null,"text":"

"}],[{"start":84.14,"text":"Goldman chief executive David Solomon sought to allay investor concerns over the earnings miss, telling analysts it was still “the 10th best Ficc quarter ever out of 100 and some odd quarters”. Goldman shares fell about 3 per cent in early trading on Monday. "}],[{"start":101.28,"text":"Even with the decline in revenues in its fixed income unit, it was the third-best quarter for Goldman’s trading business in its history. "}],[{"start":110.66,"text":"These businesses benefit when markets are volatile, as in the first quarter when there was frantic trading around the US military operation in Venezuela and the conflict in the Middle East, which triggered a sharp increase in oil prices. "}],[{"start":null,"text":""}],[{"start":126.31,"text":"In the wider business, investment banking fees rose almost 50 per cent from a year ago to $2.8bn as Goldman reaped the benefits of a flurry of previously announced deals that closed in the quarter. But the bank cautioned that its backlog of future investment banking fees decreased slightly, from a record level three months ago."}],[{"start":149.25,"text":"Solomon, speaking hours before a US naval blockade of the Strait of Hormuz was set to begin, said the “geopolitical landscape remains very complex”."}],[{"start":160.53,"text":"“While market conditions tempered execution for IPOs and sponsor activity broadly, we believe that activity levels will rebound once conditions stabilise,” he added. "}],[{"start":null,"text":""}],[{"start":172.08,"text":"Goldman also reported a decline in its so-called core equity tier one capital ratio, which fell in the quarter to its lowest level relative to the bank’s risk-weighted assets since 2020. "}],[{"start":185.61,"text":"The drop reflects the deregulatory environment under Donald Trump’s administration, which has relaxed rules around bank capital. "}],[{"start":194,"text":"Goldman used its capital to increase its lending, principally in its trading business and loans to wealthy clients. "}],[{"start":202.54,"text":"The bank also paid more than $6bn to shareholders through stock buybacks and dividends, an increase of about $1bn from a year ago. "}],[{"start":213.07,"text":"Solomon said Goldman was using Anthropic’s Claude Mythos AI model that was the subject of an impromptu meeting last week between bank bosses and US Treasury secretary Scott Bessent. "}],[{"start":226.97,"text":"“With the help of the US government and the model publishers, you know, we are very focused on supplementing our cyber and infrastructure resilience,” Solomon said. "}],[{"start":245.75,"text":""}]],"url":"https://audio.ftcn.net.cn/album/a_1776136377_4252.mp3"}