Bruising setback for Goldman Sachs as profits sink to a three-year low as deals dry up

Brutal setback for Goldman Sachs as profits fall to three-year lows and deals dry up

Goldman Sachs has posted its worst performance in three years in a painful setback for the Wall Street giant.

The bank said profits fell 62 per cent to £835 million in the second quarter of the year, the lowest since the same period of 2020.

Like other Wall Street investment banks, Goldman has been hit by a lack of dealmaking and stock market volatility amid concerns about the global economy.

But CEO David Solomon said he saw signs of improvement.

Slump: Goldman Sachs said its second-quarter profit fell 62% to £835 million – its lowest amount since the same period of 2020

“It certainly feels better over the course of the last six, eight weeks,” Solomon told analysts on a conference call.

“Obviously this is a tough quarter,” but, he added, “the environment feels better.”

He indicates that activity is picking up and customers are once again talking about mergers and acquisitions.

But he warned that the economic situation remains challenging as loans to households and businesses sour.

“This juncture in the economic cycle is creating significant headwinds for Goldman Sachs,” said Solomon.

“We make tough decisions that drive the strategic evolution of the company.

“Given both these factors, it should come as no surprise that we are entering a period of lower earnings.”