Chillin' out till it needs to be funded
With leadership in completed M&A esp in fee rich United States, Goldman Sachs powered ahead to a $1.57bln revenue in Investment Banking Fee Advisory income esp as it also capitalised on the bullishness in debt markets to get bragging rights in Debt Underwriting with $694 mln in the quarter not #1 in the sector but close to leaders in its peer group shoring up its advisory business
Consistent outperformance in Investment Banking definitely improves its quality of earnings despite the continuing overhang in Private Equity and its BRIC/Asia investments as also the continuing volatility in trading opportunities. Its bearish call on Gold hit he proverbial oil well after a long gap and its 12% ROE for the first quarter, though considerably higher than Q1 2012 at $4.29 earnings per share came on barely even revenues of $10 Bln
Trading income improved considerably too, with FICC and Equities contributing $3.22 Bln and $1.92 Bln, a considerable improvement on the fourth quarter reported three months ago but down froma considerably dwindled contribution in Q1 2012 again.
Citi managed to report higher Securities and Trading revenue in the quarter than the Wall Street King emperor. Staffing has decreased by a further 1% bringing comp down to 43% at $4.34 B unchanged from Q1 2012. Comp ratio is maintained at 43% more or less and actual cost changes quarter to quarter based on accruals and is best compared to the year ago business expenditure for the firm. Non compensation expenses were down jer to $138ust under 20% from the fourth quarter
Tangible Book value improved further to $138.69. Including last year’s authorisation of 86.4 million shares the firm still has another 161 mln shares repurchase already authorised and completed $1.5 B of buybacks in the quarter Total assets also inceased a healthy $20 Bln after a slow 2012 to $959 Bln
The bank’s wealth management /fund management revenue dropped 13% to $1.32 B for the quarter from Q4 2012 while proprietary investments yielded a large $2 bln in revenues including a very small component from ICBC sales and a more than $1 bln in gains from PE holding sales and $566 mln from debt securities