8-K
GOLDMAN SACHS GROUP INC Depositary Shares, Each Representing 1/1,000th Interest in a Share of 5.50% Fixed-to-Floating Rate Non-Cumulative Preferred Stock, Series J Depositary Shares, Each Representing 1/1,000th Interest in a Share of 6.375% Fixed-to-Floating Rate Non-Cumulative Preferred Stock, Series K 5.793% Fixed-to-Floating Rate Normal Automatic Preferred Enhanced Capital Securities of Goldman Sachs Capital II NY false 0000886982 0000886982 2022-10-18 2022-10-18 0000886982 us-gaap:CommonStockMember 2022-10-18 2022-10-18 0000886982 gs:DepositarySharesEachRepresenting11000thInterestInAShareOfFloatingRateNonCumulativePreferredStockSeriesA4Member 2022-10-18 2022-10-18 0000886982 gs:DepositarySharesEachRepresenting11000thInterestInAShareOfFloatingRateNonCumulativePreferredStockSeriesC1Member 2022-10-18 2022-10-18 0000886982 gs:DepositarySharesEachRepresenting11000thInterestInAShareOfFloatingRateNonCumulativePreferredStockSeriesD2Member 2022-10-18 2022-10-18 0000886982 gs:DepositarySharesEachRepresenting11000thInterestInAShareOf5.50FixedToFloatingRateNonCumulativePreferredStockSeriesJMember 2022-10-18 2022-10-18 0000886982 gs:DepositarySharesEachRepresenting11000thInterestInAShareOf6.375FixedToFloatingRateNonCumulativePreferredStock3Member 2022-10-18 2022-10-18 0000886982 gs:M5.793FixedToFloatingRateNormalAutomaticPreferredEnhancedCapitalSecuritiesOfGoldmanSachsCapitalIiMember 2022-10-18 2022-10-18 0000886982 gs:FloatingRateNormalAutomaticPreferredEnhancedCapitalSecuritiesOfGoldmanSachsCapitalIiiMember 2022-10-18 2022-10-18 0000886982 gs:SeriesFMediumTermNotesCallableFixedAndFloatingRateNotesDueMarch2031OfGsFinanceCorpMember 2022-10-18 2022-10-18 0000886982 gs:SeriesFMediumTermNotesCallableFixedAndFloatingRateNotesDueMay2031OfGsFinanceCorpMember 2022-10-18 2022-10-18

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

Form 8-K

 

                      

  

CURRENT REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

Date of Report (Date of earliest event reported): October 18, 2022

The Goldman Sachs Group, Inc.

(Exact name of registrant as specified in its charter)

Commission File Number: 001-14965

 

Delaware   13-4019460

(State or other jurisdiction of

incorporation or organization)

  

(IRS Employer

Identification No.)

200 West Street, New York, N.Y.   10282
(Address of principal executive offices)   (Zip Code)

(212) 902-1000

(Registrant’s telephone number, including area code)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class   Trading
Symbol		  

Exchange

on which

registered

Common stock, par value $.01 per share   GS   NYSE
Depositary Shares, Each Representing 1/1,000th Interest in a Share of Floating Rate Non-Cumulative Preferred Stock, Series A   GS PrA   NYSE
Depositary Shares, Each Representing 1/1,000th Interest in a Share of Floating Rate Non-Cumulative Preferred Stock, Series C   GS PrC   NYSE
Depositary Shares, Each Representing 1/1,000th Interest in a Share of Floating Rate Non-Cumulative Preferred Stock, Series D   GS PrD   NYSE
Depositary Shares, Each Representing 1/1,000th Interest in a Share of 5.50% Fixed-to-Floating Rate Non-Cumulative Preferred Stock, Series J   GS PrJ   NYSE
Depositary Shares, Each Representing 1/1,000th Interest in a Share of 6.375% Fixed-to-Floating Rate Non-Cumulative Preferred Stock, Series K   GS PrK   NYSE
5.793% Fixed-to-Floating Rate Normal Automatic Preferred Enhanced Capital Securities of Goldman Sachs Capital II   GS/43PE   NYSE
Floating Rate Normal Automatic Preferred Enhanced Capital Securities of Goldman Sachs Capital III   GS/43PF   NYSE
Medium-Term Notes, Series F, Callable Fixed and Floating Rate Notes due March 2031 of GS Finance Corp.   GS/31B   NYSE

Medium-Term Notes, Series F, Callable Fixed and Floating Rate Notes due May 2031 of GS Finance Corp.

 

   GS/31X   NYSE

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR 230.405) or Rule 12b-2 of the Exchange Act of 1934 (17 CFR 240.12b-2).

Emerging growth company  ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐

TABLE OF CONTENTS

 

Item 2.02 Results of Operations and Financial Condition

   

Item 7.01 Regulation FD Disclosure

   

Item 9.01 Financial Statements and Exhibits

   

SIGNATURE

   

Exhibit 99.1: PRESS RELEASE

  

Exhibit 99.2: PRESENTATION

   

Item 2.02 Results of Operations and Financial Condition.

On October 18, 2022, The Goldman Sachs Group, Inc. (Group Inc. and, together with its consolidated subsidiaries, the firm) reported its earnings for the third quarter ended September 30, 2022. A copy of Group Inc.’s press release containing this information is attached as Exhibit 99.1 to this Report on Form 8-K and is incorporated herein by reference.

Item 7.01 Regulation FD Disclosure.

On October 18, 2022, at 9:30 a.m. (ET), the firm will hold a conference call to discuss the firm’s financial results, outlook and related matters. A copy of the presentation for the conference call is attached as Exhibit 99.2 to this Report on Form 8-K.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

 

  99.1

Press release of Group Inc. dated October 18, 2022 containing financial information for its third quarter ended September 30, 2022.

The quotation on page 1 of Exhibit 99.1 and the information under the caption “Highlights” on the following page (Excluded Sections) shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (Exchange Act) or otherwise subject to the liabilities under that Section and shall not be deemed to be incorporated by reference into any filing of Group Inc. under the Securities Act of 1933 or the Exchange Act. The information included in Exhibit 99.1, other than in the Excluded Sections, shall be deemed “filed” for purposes of the Exchange Act.

 

  99.2

Presentation of Group Inc. dated October 18, 2022, for the conference call on October 18, 2022.

Exhibit 99.2 is being furnished pursuant to Item 7.01 of Form 8-K and the information included therein shall not be deemed “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities under that Section and shall not be deemed to be incorporated by reference into any filing of Group Inc. under the Securities Act of 1933 or the Exchange Act.

 

  101

Pursuant to Rule 406 of Regulation S-T, the cover page information is formatted in iXBRL (Inline eXtensible Business Reporting Language).

 

  104

Cover Page Interactive Data File (formatted in iXBRL in Exhibit 101).

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

 

THE GOLDMAN SACHS GROUP, INC.

  
     

          (Registrant)

  

Date: October 18, 2022

  

By:

  

/s/ Denis P. Coleman III

  
                                                                                                        

Name:  Denis P. Coleman III

  
   

Title:    Chief Financial Officer

  

Exhibit 99.1

 

LOGO

 

 

Third Quarter 2022

 

Earnings Results

 

    Media Relations: Andrea Williams 212-902-5400

    Investor Relations: Carey Halio 212-902-0300    

 

   

 

The Goldman Sachs Group, Inc.              

200 West Street | New York, NY 10282              

 

   

Third Quarter 2022 Earnings Results

Goldman Sachs Reports Third Quarter Earnings Per Common Share of $8.25

 

 

“Goldman Sachs’ third quarter results reflect the strength, breadth and diversification of our global franchise. Against the backdrop of uncertainty and volatility in the markets, we continue to prudently manage our resources and remain focused on risk management as we serve our clients. Importantly, we are confident that our strategic evolution will drive higher, more durable returns and unlock long-term value for shareholders.

 

In January 2020, we outlined our strategy in clear and direct terms, introducing a plan to grow and strengthen our core businesses, diversify our products and services, and operate more efficiently as we drive higher, more durable returns. Today, we enter the next phase of our growth, introducing a realignment of our businesses that will enable us to further capitalize on the predominant operating model of One Goldman Sachs as we better serve our clients.”

 

- David Solomon, Chairman and Chief Executive Officer      

 

 

 

Financial Summary

 

 

 

     

    

     

  

 

Net Revenues

 

  

 

Net Earnings

 

  

 

EPS

 

 

3Q22                    $11.98 billion 

 

3Q22 YTD            $36.77 billion 

 

  

 

  3Q22                    $3.07 billion 

 

 3Q22 YTD             $9.94 billion 

 

  

 

3Q22                               $8.25 

 

3Q22 YTD                     $26.71 

 

 

    

        

 

Annualized ROE1

 

    

 

Annualized  ROTE1

 

    

 

Book Value Per Share

 

 

3Q22                                 11.0% 

 

3Q22 YTD                        12.2% 

 

    

 

 3Q22                              12.0% 

 

 3Q22 YTD                      13.1% 

 

    

 

 3Q22                             $308.22 

 

 YTD Growth                     8.4% 

 

       

NEW YORK, October 18, 2022 – The Goldman Sachs Group, Inc. (NYSE: GS) today reported net revenues of $11.98 billion and net earnings of $3.07 billion for the third quarter ended September 30, 2022. Net revenues were $36.77 billion and net earnings were $9.94 billion for the first nine months of 2022.

Diluted earnings per common share (EPS) was $8.25 for the third quarter of 2022 compared with $14.93 for the third quarter of 2021 and $7.73 for the second quarter of 2022, and was $26.71 for the first nine months of 2022 compared with $48.59 for the first nine months of 2021.

Annualized return on average common shareholders’ equity (ROE)1 was 11.0% for the third quarter of 2022 and 12.2% for the first nine months of 2022. Annualized return on average tangible common shareholders’ equity (ROTE)1 was 12.0% for the third quarter of 2022 and 13.1% for the first nine months of 2022.

1      

 

Goldman Sachs Reports

Third Quarter 2022 Earnings Results

 

 

Highlights

 

 

  ◾  

During the quarter, the firm continued to support clients amid a challenging macroeconomic environment and generated solid quarterly net revenues of $11.98 billion, net earnings of $3.07 billion and diluted EPS of $8.25.

 

 

  ◾  

The firm ranked #1 in worldwide announced and completed mergers and acquisitions and in worldwide equity and equity-related offerings for the year-to-date.2

 

 

  ◾  

Global Markets generated quarterly net revenues of $6.20 billion, reflecting strong performances in both Fixed Income, Currency and Commodities (FICC) and Equities, particularly in financing.

 

 

  ◾  

Consumer & Wealth Management generated record quarterly net revenues of $2.38 billion, 18% higher than the third quarter of 2021.

 

 

  ◾  

Firmwide Management and other fees were a record $2.24 billion for the third quarter of 2022, 15% higher than the third quarter of 2021.

 

 

  ◾  

Book value per common share increased by 2.1% during the quarter and 8.4% during the first nine months of 2022 to $308.22.

 

 

 

Quarterly Net Revenue Mix by Segment

 

LOGO

2      

 

Goldman Sachs Reports

Third Quarter 2022 Earnings Results

 

 

Net Revenues

 

    

 

Net revenues were $11.98 billion for the third quarter of 2022, 12% lower than a strong third quarter of 2021 and 1% higher than the second quarter of 2022. The decrease compared with the third quarter of 2021 reflected significantly lower net revenues in Investment Banking and Asset Management, partially offset by higher net revenues in Global Markets and Consumer & Wealth Management.

       

 

Net Revenues

 

   

 

$11.98 billion

 

   
   

 

 

 

  

 

   Investment Banking  

 

  

 

  

 

Net revenues in Investment Banking were $1.58 billion for the third quarter of 2022, 57% lower than a strong third quarter of 2021 and 26% lower than the second quarter of 2022. The decrease compared with the third quarter of 2021 reflected significantly lower net revenues in Underwriting, Financial advisory and Corporate lending.

 

The decrease in Underwriting net revenues was due to significantly lower net revenues in both Equity and Debt underwriting, reflecting a significant decline in industry-wide volumes. The decrease in Financial advisory net revenues reflected a significant decline in industry-wide completed mergers and acquisitions transactions from elevated activity levels in the prior year period. The decrease in Corporate lending net revenues was primarily due to net mark-downs on acquisition financing activities and net losses on hedges.

 

The firm’s backlog3 was essentially unchanged compared with the end of the second quarter of 2022.

    

 

Investment Banking

 

   

 

$1.58 billion

 

      

 

Financial advisory

  

 

    $972 million 

   

Underwriting

  

    $569 million 

   

Corporate lending  

 

  

    $  35 million  

 

     
     
     
     
     
     

 

 

 

  

 

   Global Markets  

 

  

 

  

 

Net revenues in Global Markets were $6.20 billion for the third quarter of 2022, 11% higher than the third quarter of 2021 and 4% lower than the second quarter of 2022.

 

Net revenues in FICC were $3.53 billion, 41% higher than the third quarter of 2021, primarily reflecting significantly higher net revenues in FICC intermediation, driven by significantly higher net revenues in interest rate products and currencies, and higher net revenues in commodities and credit products, partially offset by significantly lower net revenues in mortgages. In addition, net revenues in FICC financing were significantly higher, primarily driven by repurchase agreements and mortgage lending.

 

Net revenues in Equities were $2.68 billion, 14% lower than a strong third quarter of 2021, primarily due to lower net revenues in Equities intermediation, reflecting significantly lower net revenues in cash products and lower net revenues in derivatives. Net revenues in Equities financing were slightly lower.

       

 

Global Markets

 

   

 

$6.20 billion

 

   

 

FICC intermediation

  

 

$2.80 billion  

   

FICC financing

  

$725 million  

   

FICC

  

$3.53 billion  

       
   

Equities intermediation

  

$1.55 billion  

   

Equities financing

  

$1.13 billion  

   

Equities

 

  

$2.68 billion  

 

     
     
     
     
     
     

3      

 

Goldman Sachs Reports

Third Quarter 2022 Earnings Results

 

 

      

 

   Asset Management  

 

       

 

Net revenues in Asset Management were $1.82 billion for the third quarter of 2022, 20% lower than the third quarter of 2021 and 68% higher than the second quarter of 2022. The decrease compared with the third quarter of 2021 primarily reflected significantly lower net revenues in Equity investments and Lending and debt investments, partially offset by significantly higher net revenues in Management and other fees.

 

The decrease in Equity investments net revenues reflected significantly lower net gains from investments in private equities, partially offset by mark-to-market net gains from investments in public equities compared with significant net losses in the third quarter of 2021. The decrease in Lending and debt investments net revenues primarily reflected net mark-downs compared with net mark-ups in the prior year period. Incentive fees were lower, driven by harvesting in the prior year period. The increase in Management and other fees reflected the inclusion of NN Investment Partners (NNIP) in the current period and the impact of fee waivers on money market funds in the prior year period.

    

 

Asset Management

   

 

$1.82 billion

 

   

 

Management and   other fees

   $1.03 billion  
   

Incentive fees

   $  36 million  
   

Equity investments

   $527 million  
 

  

  

Lending and debt

  investments

 

  

$231 million  

 

     
     
     
     
     
     

 

      

 

   Consumer & Wealth Management  

 

       

 

Net revenues in Consumer & Wealth Management were $2.38 billion for the third quarter of 2022, 18% higher than the third quarter of 2021 and 9% higher than the second quarter of 2022.

 

Net revenues in Wealth management were $1.63 billion, essentially unchanged compared with the third quarter of 2021, reflecting significantly lower Incentive fees, driven by harvesting in the prior year period, offset by significantly higher net revenues in Private banking and lending, due to the impact of higher loan and deposit balances. Management and other fees were essentially unchanged.

 

Net revenues in Consumer banking were $744 million, nearly double the amount in the third quarter of 2021, primarily reflecting significantly higher credit card balances and higher deposit spreads.

    

 

Consumer &

Wealth Management

   

 

$2.38 billion

 

   

 

Wealth management

 

   $1.63 billion  
   

Consumer banking

 

  

$744 million  

 

     
     
     
     
     

 

 

Provision for Credit Losses

 

Provision for credit losses was $515 million for the third quarter of 2022, compared with $175 million in the third quarter of 2021 and $667 million in the second quarter of 2022. Provisions for the third quarter of 2022 reflected consumer portfolio growth, net charge-offs and the impact of continued broad concerns on the macroeconomic outlook. The third quarter of 2021 primarily reflected provisions related to portfolio growth (primarily in credit cards).

 

The firm’s allowance for credit losses was $5.59 billion as of September 30, 2022.

  

  

  

 

Provision for Credit Losses

   

 

$515 million

 

   
   
   
   
   
   
   
   

4      

 

Goldman Sachs Reports

Third Quarter 2022 Earnings Results

 

 

Operating Expenses

 

 

Operating expenses were $7.70 billion for the third quarter of 2022, 17% higher than the third quarter of 2021 and 1% higher than the second quarter of 2022. The firm’s efficiency ratio3 for the first nine months of 2022 was 62.7%, compared with 52.8% for the first nine months of 2021.

 

  

  

  

 

Operating Expenses

 

 

 

$7.70 billion

 

 

The increase in operating expenses compared with the third quarter of 2021 included higher compensation and benefits expenses (reflecting a smaller reduction in the year- to-date ratio of compensation and benefits to net revenues, net of provision for credit losses, compared with the prior year period), the inclusion of NNIP and GreenSky, Inc., higher net provisions for litigation and regulatory proceedings, and higher transaction based expenses.

 

Net provisions for litigation and regulatory proceedings for the third quarter of 2022 were $191 million compared with $52 million for the third quarter of 2021.

 

Headcount increased 4% compared with the end of the second quarter of 2022, primarily reflecting the timing of campus hires and investments in growth initiatives.

 

  

 

YTD Efficiency Ratio

 

 

 

62.7%

 

 
 
   
   
   
   
   
   
   

 

Provision for Taxes

 

 

The effective income tax rate for the first nine months of 2022 increased to 16.9% from 16.3% for the first half of 2022, primarily due to a decrease in the impact of tax benefits on the settlement of employee share-based awards in the first nine months of 2022 compared with the first half of 2022.

    

 

    
 

 

YTD Effective Tax Rate

 

 

 

16.9%

 

 
   
   

 

 

Other Matters

 

 

◾ On October 17, 2022, the Board of Directors of The Goldman Sachs Group, Inc. declared a dividend of $2.50 per common share to be paid on December 29, 2022 to common shareholders of record on December 1, 2022.

 

◾ During the quarter, the firm returned $1.89 billion of capital to common shareholders, including $1.00 billion of common share repurchases (3.0 million shares at an average cost of $332.32) and $893 million of common stock dividends.3

 

◾   Global core liquid assets3 averaged $417 billion4 for the third quarter of 2022, compared with an average of $391 billion for the second quarter of 2022.

  

 

  

Declared Quarterly

Dividend Per Common Share

 

 

 

$2.50

 

 
 

 

Common Share Repurchases

 

 

 

3.0 million shares for $1.00 billion

 

   
   

 

Average GCLA

 

   

 

$417 billion

 

5      

 

Goldman Sachs Reports

Third Quarter 2022 Earnings Results

 

 

The Goldman Sachs Group, Inc. is a leading global financial institution that delivers a broad range of financial services across investment banking, securities, investment management and consumer banking to a large and diversified client base that includes corporations, financial institutions, governments and individuals. Founded in 1869, the firm is headquartered in New York and maintains offices in all major financial centers around the world.

 

        

 

   Cautionary Note Regarding Forward-Looking Statements  

 

         

This press release contains “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements are not historical facts or statements of current conditions, but instead represent only the firm’s beliefs regarding future events, many of which, by their nature, are inherently uncertain and outside of the firm’s control. It is possible that the firm’s actual results, financial condition and liquidity may differ, possibly materially, from the anticipated results, financial condition and liquidity in these forward-looking statements. For information about some of the risks and important factors that could affect the firm’s future results, financial condition and liquidity, see “Risk Factors” in Part I, Item 1A of the firm’s Annual Report on Form 10-K for the year ended December 31, 2021.

Information regarding the firm’s assets under supervision, capital ratios, risk-weighted assets, supplementary leverage ratio, balance sheet data, global core liquid assets and VaR consists of preliminary estimates. These estimates are forward-looking statements and are subject to change, possibly materially, as the firm completes its financial statements.

Statements about the firm’s investment banking transaction backlog and future results also may constitute forward-looking statements. Such statements are subject to the risk that transactions may be modified or may not be completed at all, and related net revenues may not be realized or may be materially less than expected. Important factors that could have such a result include, for underwriting transactions, a decline or weakness in general economic conditions, an outbreak or worsening of hostilities, including the escalation or continuation of the war between Russia and Ukraine, continuing volatility in the securities markets or an adverse development with respect to the issuer of the securities and, for financial advisory transactions, a decline in the securities markets, an inability to obtain adequate financing, an adverse development with respect to a party to the transaction or a failure to obtain a required regulatory approval. For information about other important factors that could adversely affect the firm’s investment banking transactions, see “Risk Factors” in Part I, Item 1A of the firm’s Annual Report on Form 10-K for the year ended December 31, 2021.

 

        

 

   Conference Call  

 

         

A conference call to discuss the firm’s financial results, outlook and related matters will be held at 9:30 am (ET). The call will be open to the public. Members of the public who would like to listen to the conference call should dial 1-800-753-0786 (in the U.S.) or 1-323-794-2410 (outside the U.S.) passcode number 7042022. The number should be dialed at least 10 minutes prior to the start of the conference call. The conference call will also be accessible as an audio webcast through the Investor Relations section of the firm’s website, www.goldmansachs.com/investor-relations. There is no charge to access the call. For those unable to listen to the live broadcast, a replay will be available on the firm’s website or by dialing 1-888-203-1112 (in the U.S.) or 1-  719-457-0820 (outside the U.S.) passcode number 7042022 beginning approximately three hours after the event. Please direct any questions regarding obtaining access to the conference call to Goldman Sachs Investor Relations, via e-mail, at [email protected].

6      

Goldman Sachs Reports

Third Quarter 2022 Earnings Results

 

The Goldman Sachs Group, Inc. and Subsidiaries

Segment Net Revenues (unaudited)

$ in millions

 

     
     THREE MONTHS ENDED           % CHANGE FROM  
         
     SEPTEMBER 30,
2022		     JUNE 30,
2022		     SEPTEMBER 30,
2021		              JUNE 30,
2022		     SEPTEMBER 30,
2021		  

 

INVESTMENT BANKING

 

                                          

Financial advisory

     $             972         $          1,197         $              1,648                                 (19) %                            (41) %  
                 

Equity underwriting

     241         131         1,174            84            (79)      

Debt underwriting

 

    

 

 328  

 

  

 

    

 

 457  

 

  

 

    

 

 726   

 

  

 

      

 

 (28)    

 

  

 

    

 

 (55)    

 

  

 

Underwriting

     569         588         1,900            (3)           (70)      
                 

Corporate lending

 

    

 

 35  

 

  

 

    

 

 352  

 

  

 

    

 

 152   

 

  

 

      

 

 (90)    

 

  

 

    

 

 (77)    

 

  

 

 

Net revenues

 

    

 

 1,576  

 

  

 

    

 

 2,137  

 

  

 

    

 

 3,700   

 

  

 

      

 

 (26)    

 

  

 

    

 

 (57)    

 

  

 

                 

 

GLOBAL MARKETS

 

                                          

 

FICC intermediation

     2,800         2,839         1,995            (1)           40       

FICC financing

 

    

 

 725  

 

  

 

    

 

 768  

 

  

 

    

 

 513   

 

  

 

      

 

 (6)    

 

  

 

    

 

 41     

 

  

 

FICC

     3,525         3,607         2,508            (2)           41       
                 

Equities intermediation

     1,549         1,734         1,920            (11)           (19)      

 

Equities financing

    

 

 1,127  

 

  

 

    

 

 1,126  

 

  

 

    

 

 1,183   

 

  

 

      

 

 –     

 

  

 

    

 

 (5)    

 

  

 

 

Equities

 

    

 

 2,676  

 

  

 

    

 

 2,860  

 

  

 

    

 

 3,103   

 

  

 

      

 

 (6)    

 

  

 

    

 

 (14)    

 

  

 

Net revenues

 

    

 

 6,201  

 

  

 

    

 

 6,467  

 

  

 

    

 

 5,611   

 

  

 

      

 

 (4)    

 

  

 

    

 

 11     

 

  

 

                 

 

ASSET MANAGEMENT

 

                                          

 

Management and other fees

     1,027         1,008         724            2            42       

 

Incentive fees

 

    

 

 36  

 

  

 

    

 

 160  

 

  

 

    

 

 100   

 

  

 

      

 

 (78)    

 

  

 

    

 

 (64)    

 

  

 

Equity investments

     527         (221)        935            N.M.            (44)      

 

Lending and debt investments

 

    

 

 231  

 

  

 

    

 

 137  

 

  

 

    

 

 520   

 

  

 

      

 

 69     

 

  

 

    

 

 (56)    

 

  

 

Net revenues

 

    

 

 1,821  

 

  

 

    

 

 1,084  

 

  

 

    

 

 2,279   

 

  

 

      

 

 68     

 

  

 

    

 

 (20)    

 

  

 

                 

 

CONSUMER & WEALTH MANAGEMENT

 

                                          

 

Management and other fees

     1,217         1,224         1,223            (1)           –       

 

Incentive fees

     21         24         121            (13)           (83)      

 

Private banking and lending

 

    

 

 395  

 

  

 

    

 

 320  

 

  

 

    

 

 292   

 

  

 

      

 

 23     

 

  

 

    

 

 35     

 

  

 

Wealth management

     1,633         1,568         1,636            4            –       
                 

Consumer banking

 

    

 

 744  

 

  

 

    

 

 608  

 

  

 

    

 

 382   

 

  

 

      

 

 22     

 

  

 

    

 

 95     

 

  

 

Net revenues

 

    

 

 2,377  

 

  

 

    

 

 2,176  

 

  

 

    

 

 2,018   

 

  

 

      

 

 9     

 

  

 

    

 

 18     

 

  

 

                 

 

Total net revenues

 

    

 

 $        11,975  

 

  

 

    

 

 $        11,864  

 

  

 

    

 

 $            13,608   

 

  

 

      

 

 1     

 

  

 

    

 

 (12)    

 

  

 

 

Geographic Net Revenues (unaudited)3

 

          
$ in millions            
   
     THREE MONTHS ENDED                    
     
     SEPTEMBER 30,
2022		     JUNE 30,
2022		     SEPTEMBER 30,
2021		                       

 

Americas

     $          7,542         $          7,047         $              8,169           

 

EMEA

     3,094         3,400         3,394           

 

Asia

 

    

 

 1,339  

 

  

 

    

 

 1,417  

 

  

 

    

 

 2,045   

 

  

 

      

Total net revenues

 

    

 

 $        11,975  

 

  

 

    

 

 $        11,864  

 

  

 

    

 

 $            13,608   

 

  

 

      
               

Americas

     63%        59%        60%        

 

EMEA

     26%        29%        25%        

 

Asia

 

    

 

 11% 

 

  

 

    

 

 12% 

 

  

 

    

 

 15%

 

  

 

      

Total

 

    

 

 100% 

 

  

 

    

 

 100% 

 

  

 

    

 

 100%

 

  

 

      

 

7

Goldman Sachs Reports

Third Quarter 2022 Earnings Results

 

The Goldman Sachs Group, Inc. and Subsidiaries

Segment Net Revenues (unaudited)

$ in millions

 

     
     NINE MONTHS ENDED          % CHANGE FROM                                 
     
    

SEPTEMBER 30,

2022

    

SEPTEMBER 30,

2021

           

SEPTEMBER 30,

2021

      

 

INVESTMENT BANKING

 

                            

 

Financial advisory

     $           3,296          $           4,022            (18) %    
               

Equity underwriting

     633          3,986            (84)        

 

Debt underwriting

     1,528          2,556            (40)        

 

Underwriting

     2,161          6,542            (67)        
               

 

Corporate lending

 

    

 

 667   

 

  

 

    

 

 516   

 

  

 

      

 

 29     

 

  

 

  

 

Net revenues

 

    

 

 6,124   

 

  

 

    

 

 11,080   

 

  

 

      

 

 (45)    

 

  

 

  
               

 

GLOBAL MARKETS

 

                            

 

FICC intermediation

     9,677          7,343            32         

 

FICC financing

     2,178          1,378            58         

 

FICC

     11,855          8,721            36         
               

Equities intermediation

     5,444          6,271            (13)        

 

Equities financing

     3,241          3,100            5         

 

Equities

 

    

 

 8,685   

 

  

 

    

 

 9,371   

 

  

 

      

 

 (7)    

 

  

 

  

 

Net revenues

 

    

 

 20,540   

 

  

 

    

 

 18,092   

 

  

 

      

 

 14     

 

  

 

  
               

 

ASSET MANAGEMENT

 

                            

 

Management and other fees

     2,807          2,144            31         

 

Incentive fees

     248          220            13         

 

Equity investments

     (61)         7,772            N.M.         

 

Lending and debt investments

 

     457          1,889            (76)        

 

Net revenues

 

    

 

 3,451   

 

  

 

    

 

 12,025   

 

  

 

      

 

 (71)    

 

  

 

  
               

 

CONSUMER & WEALTH MANAGEMENT

 

                            

 

Management and other fees

     3,696          3,409            8         

 

Incentive fees

     72          162            (56)        

 

Private banking and lending

     1,054          816            29         

 

Wealth management

     4,822          4,387            10         
               

Consumer banking

 

    

 

 1,835   

 

  

 

    

 

 1,116   

 

  

 

      

 

 64     

 

  

 

  

 

Net revenues

 

    

 

 6,657   

 

  

 

    

 

 5,503   

 

  

 

      

 

 21     

 

  

 

  
               

 

Total net revenues

 

    

 

 $         36,772   

 

  

 

    

 

 $         46,700   

 

  

 

      

 

 (21)    

 

  

 

  

 

Geographic Net Revenues (unaudited)3

$ in millions

 

 

 

        
   
     NINE MONTHS ENDED                
     
    

SEPTEMBER 30,

2022

    

SEPTEMBER 30,

2021

                

Americas

     $         21,975          $         28,951            

 

EMEA

     10,344          11,585            

 

Asia

 

    

 

 4,453   

 

  

 

    

 

 6,164    

 

  

 

      

 

Total net revenues

 

    

 

 $         36,772   

 

  

 

    

 

 $         46,700    

 

  

 

      
             

Americas

     60%        62%         

 

EMEA

     28%        25%         

 

Asia

 

    

 

 12% 

 

  

 

    

 

 13% 

 

  

 

      

 

Total

 

    

 

 100% 

 

  

 

    

 

 100% 

 

  

 

      

 

8

Goldman Sachs Reports

Third Quarter 2022 Earnings Results

 

The Goldman Sachs Group, Inc. and Subsidiaries

Consolidated Statements of Earnings (unaudited)

In millions, except per share amounts and headcount

 

     
     THREE MONTHS ENDED          % CHANGE FROM           
       
    

SEPTEMBER 30,

2022

    

     JUNE 30,     

2022

    

    SEPTEMBER 30,    

2021

         

     JUNE 30,     

2022

    

SEPTEMBER 30,

2021

        

REVENUES

 

                                                  

Investment banking

 

     $        1,541        $          1,785        $           3,548            (14 ) %      (57 ) %   

Investment management

 

     2,276        2,393        2,139            (5 )         6         

Commissions and fees

 

     995        1,073        860            (7 )          16         

Market making

 

     4,642        4,929        3,929            (6 )          18         

Other principal transactions

 

 

    

 

 478

 

   

 

    

 

 (50

 

 ) 

 

    

 

 1,568  

 

  

 

       

 

 N.M

 

 .      

 

    

 

 (70

 

 )     

 

  

Total non-interest revenues

 

    

 

 9,932

 

   

 

    

 

 10,130

 

   

 

    

 

 12,044  

 

  

 

       

 

 (2

 

 )     

 

    

 

 (18

 

 )     

 

  
                    

Interest income

 

     8,550        4,851        3,117            76            174         

Interest expense

 

    

 

 6,507

 

   

 

    

 

 3,117

 

   

 

    

 

 1,553  

 

  

 

       

 

 109

 

       

 

    

 

 319

 

       

 

  

Net interest income

 

    

 

 2,043

 

   

 

    

 

 1,734

 

   

 

    

 

 1,564  

 

  

 

       

 

 18

 

       

 

    

 

 31

 

       

 

  
                    

 

 

Total net revenues

 

    

 

 11,975

 

   

 

    

 

 11,864

 

   

 

    

 

 13,608  

 

  

 

       

 

 1

 

       

 

    

 

 (12

 

 )     

 

  
                    

 

Provision for credit losses

 

    

 

 515

 

   

 

    

 

 667

 

   

 

    

 

 175  

 

  

 

       

 

 (23

 

 )     

 

    

 

 194

 

       

 

  
                    

 

OPERATING EXPENSES

 

                                             

Compensation and benefits

 

     3,606        3,695        3,167            (2 )          14         

Transaction based

 

     1,317        1,317        1,139            –            16         

Market development

 

     199        235        165            (15 )          21         

Communications and technology

 

     459        444        397            3            16         

Depreciation and amortization

 

     666        570        509            17            31         

Occupancy

 

     255        259        239            (2 )          7         

Professional fees

 

     465        490        433            (5 )          7         

Other expenses

 

    

 

 737

 

   

 

    

 

 643

 

   

 

    

 

 542  

 

  

 

       

 

 15

 

       

 

    

 

 36

 

       

 

  

Total operating expenses

 

    

 

 7,704

 

   

 

    

 

 7,653

 

   

 

    

 

 6,591  

 

  

 

       

 

 1

 

       

 

    

 

 17

 

  

 

  
                    

Pre-tax earnings

 

     3,756        3,544        6,842            6            (45 )       

Provision for taxes

 

    

 

 687

 

   

 

    

 

 617

 

   

 

    

 

 1,464  

 

  

 

       

 

 11

 

       

 

    

 

 (53

 

 )     

 

  

Net earnings

 

    

 

 3,069

 

   

 

    

 

 2,927

 

   

 

    

 

 5,378  

 

  

 

       

 

 5

 

       

 

    

 

 (43

 

 )     

 

  

Preferred stock dividends

 

    

 

 107

 

   

 

    

 

 141

 

   

 

    

 

 94  

 

  

 

       

 

 (24

 

 )     

 

    

 

 14

 

       

 

  

Net earnings applicable to common shareholders

 

    

 

 $        2,962

 

   

 

    

 

 $          2,786

 

   

 

    

 

 $           5,284  

 

  

 

       

 

 6

 

       

 

    

 

 (44

 

 )     

 

  
                    

 

EARNINGS PER COMMON SHARE

 

                                             

Basic3

 

     $          8.35        $            7.81        $           15.14            7  %      (45 ) %   

Diluted

 

     $          8.25        $            7.73        $           14.93            7            (45 )       
                         

 

AVERAGE COMMON SHARES

 

                                             

Basic

 

     352.8        355.0        348.3            (1 )          1         

Diluted

 

     359.2        360.5        353.9            –            1         
                    

 

SELECTED DATA AT PERIOD-END

 

                                             

Common shareholders’ equity

 

     $    108,587        $      107,168        $         96,344            1            13         

Basic shares3

 

     352.3        355.0        347.5            (1 )          1         

Book value per common share

 

     $      308.22        $        301.88        $         277.25            2            11         
                    

Headcount

 

    

 

 49,100

 

   

 

    

 

 47,000

 

   

 

    

 

 43,000  

 

  

 

       

 

 4

 

       

 

    

 

 14

 

       

 

  

 

9

Goldman Sachs Reports

Third Quarter 2022 Earnings Results

 

The Goldman Sachs Group, Inc. and Subsidiaries

Consolidated Statements of Earnings (unaudited)

In millions, except per share amounts

 

     
     NINE MONTHS ENDED           % CHANGE FROM        
     
    

    SEPTEMBER 30,    

2022

    

    SEPTEMBER 30,    

2021

    

    

    

SEPTEMBER 30,

2021

    

                             

  

REVENUES

 

                            

Investment banking

 

     $           5,457        $          10,564           (48) %    

Investment management

 

     6,733        5,840           15         

Commissions and fees

 

     3,079        2,766           11         

Market making

 

     15,561        13,096           19         

Other principal transactions

 

 

    

 

 338 

 

  

 

    

 

 9,759  

 

  

 

      

 

 (97)    

 

  

 

  

Total non-interest revenues

 

    

 

 31,168 

 

  

 

    

 

 42,025  

 

  

 

      

 

 (26)    

 

  

 

  
               

Interest income

 

     16,613        9,110           82         

Interest expense

 

 

    

 

 11,009 

 

  

 

    

 

 4,435  

 

  

 

      

 

 148     

 

  

 

  

Net interest income

 

    

 

 5,604 

 

  

 

    

 

 4,675  

 

  

 

      

 

 20     

 

  

 

  
               

Total net revenues

 

    

 

 36,772 

 

  

 

    

 

 46,700  

 

  

 

      

 

 (21)    

 

  

 

  
               

Provision for credit losses

 

    

 

 1,743 

 

  

 

    

 

 13  

 

  

 

      

 

 N.M.     

 

  

 

  
               

 

OPERATING EXPENSES

 

                            

Compensation and benefits

 

     11,384        14,473           (21)        

Transaction based

 

     3,878        3,520           10         

Market development

 

     596        360           66         

Communications and technology

 

     1,327        1,143           16         

Depreciation and amortization

 

     1,728        1,527           13         

Occupancy

 

     765        727           5         

Professional fees

 

     1,392        1,137           22         

Other expenses

 

    

 

 2,003 

 

  

 

    

 

 1,781  

 

  

 

      

 

 12     

 

  

 

  

 

Total operating expenses

 

    

 

 23,073 

 

  

 

    

 

 24,668  

 

  

 

      

 

 (6)    

 

  

 

  
               

Pre-tax earnings

 

     11,956        22,019           (46)        

Provision for taxes

 

     2,021        4,319           (53)        

 

Net earnings

 

     9,935        17,700           (44)        

Preferred stock dividends

 

 

     356        358           (1)        

Net earnings applicable to common shareholders

 

     $           9,579        $          17,342           (45)        
               

EARNINGS PER COMMON SHARE

 

                            

Basic3

     $           27.03        $            49.23           (45) %    

 

Diluted

     $           26.71        $            48.59           (45)        
               

AVERAGE COMMON SHARES

 

                            

Basic

 

     353.0        351.8           –         

Diluted

 

     358.6        356.9           –         

 

10

Goldman Sachs Reports

Third Quarter 2022 Earnings Results

 

The Goldman Sachs Group, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets (unaudited)4

$ in billions

 

   
     AS OF                     
   
    

SEPTEMBER 30,

2022

    

JUNE 30,

2022

    

    

  

                    

                        

                    

 

ASSETS

 

                        

 

Cash and cash equivalents

     $             284         $             288            

 

Collateralized agreements

     380         448            

 

Customer and other receivables

     166         163            

 

Trading assets

     384         372            

 

Investments

     127         115            

 

Loans

     177         176            

 

Other assets

 

     39         39            

 

Total assets

 

  

 

 

 

 

$          1,557  

 

 

 

 

  

 

 

 

 

$          1,601  

 

 

 

 

        
               

 

LIABILITIES AND SHAREHOLDERS’ EQUITY

 

                        

 

Deposits

     $             395         $             391            

 

Collateralized financings

     219         228            

 

Customer and other payables

     279         280            

 

Trading liabilities

     232         255            

 

Unsecured short-term borrowings

     52         58            

 

Unsecured long-term borrowings

     240         251            

 

Other liabilities

     21         20            

 

Total liabilities

 

  

 

 

 

 

1,438  

 

 

 

 

  

 

 

 

 

1,483  

 

 

 

 

        

 

Shareholders’ equity

 

     119         118            

 

Total liabilities and shareholders’ equity

 

  

 

 

 

 

$          1,557  

 

 

 

 

  

 

 

 

 

$          1,601  

 

 

 

 

        

 

Capital Ratios and Supplementary Leverage Ratio (unaudited)3,4

$ in billions

 

 

 

        
   
     AS OF                      
   
    

SEPTEMBER 30,

2022

    

JUNE 30,

2022

                  

 

Common equity tier 1 capital

     $            98.7         $            98.3            
               

 

STANDARDIZED CAPITAL RULES

 

                        

 

Risk-weighted assets

     $             689         $             692            

 

Common equity tier 1 capital ratio

     14.3%       14.2%          
               

 

ADVANCED CAPITAL RULES

 

                        

 

Risk-weighted assets

     $             675         $             686            

 

Common equity tier 1 capital ratio

     14.6%       14.3%          
               

 

SUPPLEMENTARY LEVERAGE RATIO

 

                        

 

Supplementary leverage ratio

 

     5.6%       5.6%          

 

Average Daily VaR (unaudited)3,4

$ in millions

 

 

        
   
     THREE MONTHS ENDED                      
   
    

SEPTEMBER 30,

2022

    

JUNE 30,

2022

                  

 

RISK CATEGORIES

 

                        

 

Interest rates

     $           112         $             104            

 

Equity prices

     34         36            

 

Currency rates

     36         23            

 

Commodity prices

     51         63            

 

Diversification effect

     (103)        (102)           

 

 

Total

 

  

 

 

 

 

$           130  

 

 

 

 

  

 

 

 

 

$             124  

 

 

 

 

        

 

11

Goldman Sachs Reports

Third Quarter 2022 Earnings Results

 

The Goldman Sachs Group, Inc. and Subsidiaries

Assets Under Supervision (unaudited)3,4

$ in billions

 

   
     AS OF                                                                 
   
    

    SEPTEMBER 30,    

2022

    

    JUNE 30,    

2022

    

 SEPTEMBER 30, 

2021

                    

 

SEGMENT

 

                              

Asset Management

 

    

 

 $        1,760 

 

  

 

    

 

 $        1,824 

 

  

 

    

 

 $        1,678 

 

  

 

      

Consumer & Wealth Management

 

    

 

 667 

 

  

 

    

 

 671 

 

  

 

    

 

 694 

 

  

 

      

Total AUS

 

    

 

 $        2,427 

 

  

 

    

 

 $        2,495 

 

  

 

    

 

 $        2,372 

 

  

 

      
               

 

ASSET CLASS

 

                              

Alternative investments

 

    

 

 $           256 

 

  

 

    

 

 $           254 

 

  

 

    

 

 $           224 

 

  

 

      

Equity

 

    

 

 516 

 

  

 

    

 

 552 

 

  

 

    

 

 569 

 

  

 

      

Fixed income

 

    

 

 955 

 

  

 

    

 

 1,007 

 

  

 

    

 

 940 

 

  

 

      

Total long-term AUS

 

    

 

 1,727 

 

  

 

    

 

 1,813 

 

  

 

    

 

 1,733 

 

  

 

      

Liquidity products

 

    

 

 700 

 

  

 

    

 

 682 

 

  

 

    

 

 639 

 

  

 

      

Total AUS

 

    

 

 $        2,427 

 

  

 

    

 

 $        2,495 

 

  

 

    

 

 $        2,372 

 

  

 

      
           
   
     THREE MONTHS ENDED                    
   
    

SEPTEMBER 30,

2022

    

JUNE 30,

2022

    

SEPTEMBER 30,

2021

                    

 

ASSET MANAGEMENT

 

                              

Beginning balance

 

    

 

 $        1,824 

 

  

 

    

 

 $        1,656 

 

  

 

    

 

 $        1,633 

 

  

 

      

Net inflows / (outflows):

 

              

Alternative investments

    

 

 (2)

 

  

 

    

 

 3 

 

  

 

    

 

 3 

 

  

 

      

Equity

    

 

 (4)

 

  

 

    

 

 (2)

 

  

 

    

 

 3 

 

  

 

      

Fixed income

    

 

 (1)

 

  

 

    

 

 (2)

 

  

 

    

 

 27 

 

  

 

      

Total long-term AUS net inflows / (outflows)

    

 

 (7)

 

  

 

    

 

 (1)

 

  

 

    

 

 33 

 

  

 

      

Liquidity products

    

 

 14 

 

  

 

    

 

 6 

 

  

 

    

 

 11 

 

  

 

      

Total AUS net inflows / (outflows)

    

 

 7 

 

  

 

    

 

 5 

 

  

 

    

 

 44 

 

  

 

      

Acquisitions / (dispositions)

    

 

 6 

 

  

 

    

 

 305 

 

  

 

    

 

 – 

 

  

 

      

Net market appreciation / (depreciation)

    

 

 (77)

 

  

 

    

 

 (142)

 

  

 

    

 

 1 

 

  

 

      

Ending balance

 

    

 

 $        1,760 

 

  

 

    

 

 $        1,824 

 

  

 

    

 

 $        1,678 

 

  

 

      
               

 

CONSUMER & WEALTH MANAGEMENT

 

                              

Beginning balance

 

    

 

 $           671 

 

  

 

    

 

 $           738 

 

  

 

    

 

 $           672 

 

  

 

      

Net inflows / (outflows):

 

              

Alternative investments

 

    

 

 9 

 

  

 

    

 

 1 

 

  

 

    

 

 6 

 

  

 

      

Equity

 

    

 

 2 

 

  

 

    

 

 3 

 

  

 

    

 

 9 

 

  

 

      

Fixed income

 

    

 

 5 

 

  

 

    

 

 (1)

 

  

 

    

 

 1 

 

  

 

      

Total long-term AUS net inflows / (outflows)

 

    

 

 16 

 

  

 

    

 

 3 

 

  

 

    

 

 16 

 

  

 

      

Liquidity products

 

    

 

 4 

 

  

 

    

 

 (13)

 

  

 

    

 

 6 

 

  

 

      

Total AUS net inflows / (outflows)

 

    

 

 20 

 

  

 

    

 

 (10)

 

  

 

    

 

 22 

 

  

 

      

Acquisitions / (dispositions)

 

    

 

 (2)

 

  

 

    

 

 – 

 

  

 

    

 

 – 

 

  

 

      

Net market appreciation / (depreciation)

 

    

 

 (22)

 

  

 

    

 

 (57)

 

  

 

    

 

 – 

 

  

 

      

Ending balance

 

    

 

 $           667 

 

  

 

    

 

 $           671 

 

  

 

    

 

 $           694 

 

  

 

      
               

 

FIRMWIDE

 

                              

Beginning balance

 

    

 

 $        2,495 

 

  

 

    

 

 $        2,394 

 

  

 

    

 

 $        2,305 

 

  

 

      

Net inflows / (outflows):

 

              

Alternative investments

 

    

 

 7 

 

  

 

    

 

 4 

 

  

 

    

 

 9 

 

  

 

      

Equity

 

    

 

 (2)

 

  

 

    

 

 1 

 

  

 

    

 

 12 

 

  

 

      

Fixed income

 

    

 

 4 

 

  

 

    

 

 (3)

 

  

 

    

 

 28 

 

  

 

      

Total long-term AUS net inflows / (outflows)

 

    

 

 9 

 

  

 

    

 

 2 

 

  

 

    

 

 49 

 

  

 

      

Liquidity products

 

    

 

 18 

 

  

 

    

 

 (7)

 

  

 

    

 

 17 

 

  

 

      

Total AUS net inflows / (outflows)

 

    

 

 27 

 

  

 

    

 

 (5)

 

  

 

    

 

 66 

 

  

 

      

Acquisitions / (dispositions)

 

    

 

 4 

 

  

 

    

 

 305 

 

  

 

    

 

 – 

 

  

 

      

Net market appreciation / (depreciation)

 

    

 

 (99)

 

  

 

    

 

 (199)

 

  

 

    

 

 1 

 

  

 

      

Ending balance

 

    

 

 $        2,427 

 

  

 

    

 

 $        2,495 

 

  

 

    

 

 $        2,372 

 

  

 

      

 

12

Goldman Sachs Reports

Third Quarter 2022 Earnings Results

 

 

Footnotes

    

 

  1.

Annualized ROE is calculated by dividing annualized net earnings applicable to common shareholders by average monthly common shareholders’ equity. Annualized ROTE is calculated by dividing annualized net earnings applicable to common shareholders by average monthly tangible common shareholders’ equity (tangible common shareholders’ equity is calculated as total shareholders’ equity less preferred stock, goodwill and identifiable intangible assets). Management believes that ROTE is meaningful because it measures the performance of businesses consistently, whether they were acquired or developed internally, and that tangible common shareholders’ equity is meaningful because it is a measure that the firm and investors use to assess capital adequacy. ROTE and tangible common shareholders’ equity are non-GAAP measures and may not be comparable to similar non-GAAP measures used by other companies.

 

The table below presents a reconciliation of average common shareholders’ equity to average tangible common shareholders’ equity:

 

   
     AVERAGE FOR THE        
   

Unaudited, $ in millions

 

  

 THREE MONTHS ENDED

SEPTEMBER 30, 2022

    

    

  

 NINE MONTHS ENDED 

SEPTEMBER 30, 2022

    

  

  

Total shareholders’ equity

 

    

 

 $            118,013 

 

  

 

      

 

 $            115,418 

 

  

 

  

Preferred stock

 

    

 

 (10,703)

 

  

 

      

 

 (10,703)

 

  

 

  

Common shareholders’ equity

 

    

 

 107,310 

 

  

 

        

 

 104,715 

 

  

 

  

Goodwill

    

 

 (6,242)

 

  

 

      

 

 (5,546)

 

  

 

  

Identifiable intangible assets

 

    

 

 (1,987)

 

  

 

      

 

 (1,463)

 

  

 

  

Tangible common shareholders’ equity

 

    

 

 $               99,081 

 

  

 

        

 

 $             97,706 

 

  

 

  

 

  2.

Dealogic – January 1, 2022 through September 30, 2022.

 

 

  3.

For information about the following items, see the referenced sections in Part I, Item 2 “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the firm’s Quarterly Report on Form 10-Q for the period ended June 30, 2022: (i) investment banking transaction backlog – see “Results of Operations – Investment Banking” (ii) assets under supervision – see “Results of Operations – Assets Under Supervision” (iii) efficiency ratio – see “Results of Operations – Operating Expenses” (iv) share repurchase program – see “Capital Management and Regulatory Capital – Capital Management” (v) global core liquid assets – see “Risk Management – Liquidity Risk Management” (vi) basic shares – see “Balance Sheet and Funding Sources – Balance Sheet Analysis and Metrics” and (vii) VaR – see “Risk Management – Market Risk Management.”

 

 

      

For information about the following items, see the referenced sections in Part I, Item 1 “Financial Statements (Unaudited)” in the firm’s Quarterly Report on Form 10-Q for the period ended June 30, 2022: (i) risk-based capital ratios and the supplementary leverage ratio – see Note 20 “Regulation and Capital Adequacy” (ii) geographic net revenues – see Note 25 “Business Segments” and (iii) unvested share-based awards that have non-forfeitable rights to dividends or dividend equivalents in calculating basic EPS – see Note 21 “Earnings Per Common Share.”

 

 

  4.

Represents a preliminary estimate for the third quarter of 2022 and may be revised in the firm’s Quarterly Report on Form 10-Q for the period ended September 30, 2022.

 

13      

 

Exhibit 99.2 Third Quarter 2022 Earnings Results Presentation October 18, 2022

Results Snapshot Net Revenues Net Earnings EPS 3Q22 $11.98 billion 3Q22 $3.07 billion 3Q22 $8.25 3Q22 YTD $36.77 billion 3Q22 YTD $9.94 billion 3Q22 YTD $26.71 1 1 Annualized ROE Annualized ROTE Book Value Per Share 3Q22 11.0% 3Q22 12.0% 3Q22 $308.22 3Q22 YTD 12.2% 3Q22 YTD 13.1% YTD Growth 8.4% Highlights Record firmwide Management and other fees of $2.24 billion, Strong Global Markets performance across FICC and Equities up 15% YoY Record Consumer & Wealth Management net revenues, 2 #1 in M&A and Equity and equity-related offerings up 18% YoY 1

One Goldman Sachs Ethos Driving Outperformance 2 #1 Global Investment Bank World Class Active Asset Manager A Leading Global Markets Franchise Premier UHNW Wealth Manager Best-in-Class Share Gains and Growth Since Investor Day 2020 +320bps +320bps ~40% Investment Banking Global Markets BVPS Growth Ranking Relative to #1 #1 #1 3 Peers : 2

The Next Step in Our Strategic Evolution Clear Strategic New Operating Segments Direction Grow and Strengthen Existing Businesses Asset & Wealth Global Banking Platform Management & Markets Solutions Diversify our Products and Services Fully scaled and integrated Driving industry-leading Embedding digital franchise across returns through highly platforms in our Operate More Efficiently public and private markets synergistic businesses clients’ ecosystems 3

Platform Solutions: Embedding Best-in-Class Financial Products in Clients’ Ecosystems Platform Solutions Consumer Partnerships Transaction Banking + GreenSky Enhancing our focus on building platforms that deliver digital financial services to corporate and institutional clients 4

We Have Made Significant Progress Building Our Consumer Franchise $110bn+ ~$19bn 15mm+ deposits loans active customers As of 3Q22 +95% $2.2bn 3Q22 YoY net revenue growth LTM net revenues 5

Purposeful Shift in Our Customer Acquisition Strategy Forward Direct-to-Consumer Strategy ~500 Companies served Consumer Workplace & ~60% Banking Personal Wealth Fortune 100 Products 9mm+ Eligible employees 6

Amplifying Our Strengths and Unlocking Shareholder Value Clear Strategic Our Key Priorities Direction Grow and Strengthen 1 2 3 Existing Businesses Maximize wallet Scale Platform Grow management Diversify our Products share and grow Solutions to deliver fees and Services financing activities pre-tax profitability Operate More Efficiently 7

Financial Overview Financial Results Financial Overview Highlights vs. n 3Q22 results included EPS of $8.25 and ROE of 11.0% vs. vs. 3Q22 3Q21 $ in millions, except per share amounts 3Q22 2Q22 3Q21 YTD YTD — 3Q22 net revenues were lower compared with a strong 3Q21 o Significantly lower net revenues in Investment Banking and Asset Management $ 1,576 (26)% (57)% $ 6,124 (45)% Investment Banking o Partially offset by higher net revenues in Global Markets and Consumer & Wealth Global Markets 6,201 (4)% 11% 20,540 14% Management — 3Q22 provision for credit losses was $515 million, reflecting consumer portfolio growth, net Asset Management 1,821 68% (20)% 3,451 (71)% charge-offs and the impact of continued broad concerns on the macroeconomic outlook — 3Q22 operating expenses were higher YoY, driven by both non-compensation expenses and Consumer & Wealth Management 2,377 9% 18% 6,657 21% compensation and benefits expenses Net revenues 11,975 1% (12)% 36,772 (21)% Provision for credit losses 515 (23)% 194% 1,743 N.M. Net Revenues by Segment ($ in millions) Operating expenses 7,704 1% 17% 23,073 (6)% $13,608 Pre-tax earnings $ 3,756 6% (45)% $ 11,956 (46)% $11,975 $2,018 $11,864 $2,176 $2,377 Net earnings $ 3,069 5% (43)% $ 9,935 (44)% $2,279 $1,084 $1,821 Net earnings to common $ 2,962 6% (44)% $ 9,579 (45)% $5,611 8.25 7% (45)% $ 26.71 (45)% Diluted EPS $ $6,467 $6,201 1 11.0% 0.4pp (11.5)pp 12.2% (13.5)pp ROE $3,700 $2,137 1 $1,576 12.0% 0.6pp (11.8)pp 13.1% (14.1)pp ROTE 3Q21 2Q22 3Q22 4 64.3% (0.2)pp 15.9pp 62.7% 9.9pp Efficiency Ratio Investment Banking Global Markets Asset Management Consumer & Wealth Management 8

Investment Banking Financial Results Investment Banking Highlights vs. n 3Q22 net revenues were significantly lower compared with a strong 3Q21 vs. vs. 3Q22 3Q21 $ in millions 3Q22 2Q22 3Q21 YTD YTD — Financial advisory net revenues reflected a significant decline in industry-wide completed mergers and acquisitions transactions from elevated activity levels in 3Q21 Financial advisory $ 972 (19)% (41)% $ 3,296 (18)% — Equity underwriting and Debt underwriting net revenues reflected a significant decline in industry-wide volumes Equity underwriting 241 84% (79)% 633 (84)% — Corporate lending net revenues primarily reflected net mark-downs on acquisition financing activities and net losses on hedges Debt underwriting 328 (28)% (55)% 1,528 (40)% 4 n Overall backlog was essentially unchanged vs. 2Q22 Underwriting 569 (3)% (70)% 2,161 (67)% Corporate lending 35 (90)% (77)% 667 29% Investment Banking Net Revenues ($ in millions) 1,576 (26)% (57)% 6,124 (45)% Net revenues $3,700 78 (6)% 90% 325 N.M. Provision for credit losses $152 $726 1,038 (6)% (23)% 3,391 (34)% Operating expenses $2,137 460 (52)% (80)% $ 2,408 (61)% Pre-tax earnings $ $1,174 $352 $1,576 Net earnings $ 370 (53)% (80)% $ 2,001 (60)% $457 $35 $328 $131 $241 Net earnings to common $ 355 (54)% (80)% $ 1,950 (60)% $1,648 $1,197 $972 Average common equity $ 9,720 (7)% (6)% $ 10,649 4% 3Q21 2Q22 3Q22 Return on average common equity 14.6% (14.7)pp (55.7)pp 24.4% (39.5)pp Financial advisory Equity underwriting Debt underwriting Corporate lending 9

Global Markets Financial Results Global Markets Highlights vs. n 3Q22 net revenues were higher YoY vs. vs. 3Q22 3Q21 $ in millions 3Q22 2Q22 3Q21 YTD YTD — FICC net revenues reflected significantly higher net revenues in both intermediation and financing FICC $ 3,525 (2)% 41% $ 11,855 36% — Equities net revenues reflected lower net revenues in intermediation and slightly lower net revenues in financing 2,676 (6)% (14)% 8,685 (7)% Equities n 3Q22 operating environment was generally characterized by continued solid client activity, high market volatility and central bank actions amid high inflation Net revenues 6,201 (4)% 11% 20,540 14% Provision for credit losses (43) N.M. N.M. 190 N.M. Operating expenses 3,213 (5)% 15% 10,340 – $ 3,031 2% 7% $ 10,010 29% Pre-tax earnings Global Markets Net Revenues ($ in millions) Net earnings $ 2,474 1% 10% $ 8,318 33% $6,467 $6,201 Net earnings to common $ 2,408 2% 10% $ 8,102 34% $5,611 $2,860 $2,676 Average common equity $ 57,078 3% 22% $ 54,842 24% $3,103 16.9% (0.1)pp (1.8)pp 19.7% 1.4pp Return on average common equity $3,607 $3,525 $2,508 3Q21 2Q22 3Q22 FICC Equities 10

Global Markets – FICC & Equities FICC Net Revenues Equities Net Revenues vs. vs. vs. vs. 3Q22 3Q21 vs. vs. 3Q22 3Q21 $ in millions 3Q22 2Q22 3Q21 YTD YTD $ in millions 3Q22 2Q22 3Q21 YTD YTD FICC intermediation $ 2,800 (1)% 40% $ 9,677 32% Equities intermediation $ 1,549 (11)% (19)% $ 5,444 (13)% FICC financing 725 (6)% 41% 2,178 58% Equities financing 1,127 – (5)% 3,241 5% $ 3,525 (2)% 41% $ 11,855 36% $ 2,676 (6)% (14)% $ 8,685 (7)% FICC Equities FICC Highlights Equities Highlights n 3Q22 net revenues were significantly higher YoY n 3Q22 net revenues were lower YoY — FICC intermediation net revenues reflected significantly higher net revenues in interest rate — Equities intermediation net revenues reflected significantly lower net revenues in cash products and currencies, and higher net revenues in commodities and credit products, products and lower net revenues in derivatives partially offset by significantly lower net revenues in mortgages — Equities financing net revenues were slightly lower — FICC financing net revenues were significantly higher, primarily driven by repurchase agreements and mortgage lending 11

Asset Management Financial Results Asset Management Highlights vs. n 3Q22 net revenues were significantly lower YoY reflecting significantly lower net revenues in vs. vs. 3Q22 3Q21 Equity investments and Lending and debt investments $ in millions 3Q22 2Q22 3Q21 YTD YTD — Management and other fees reflected the inclusion of NN Investment Partners in 3Q22 and Management and other fees $ 1,027 2% 42% $ 2,807 31% the impact of fee waivers on money market funds in 3Q21 — Equity investments net revenues reflected significantly lower net gains from investments in private equities, partially offset by mark-to-market net gains from investments in public Incentive fees 36 (78)% (64)% 248 13% equities compared with significant net losses in 3Q21 o Private: 3Q22 ~$310 million, compared to 3Q21 ~$1,755 million 527 N.M. (44)% (61) N.M. Equity investments o Public: 3Q22 ~$215 million, compared to 3Q21 ~$(820) million — Lending and debt investments net revenues primarily reflected net mark-downs compared 231 69% (56)% 457 (76)% Lending and debt investments with net mark-ups in 3Q21 Net revenues 1,821 68% (20)% 3,451 (71)% Asset Management Net Revenues ($ in millions) Provision for credit losses 29 (51)% 190% 129 N.M. $2,279 Operating expenses 1,565 7% 90% 4,121 (11)% $520 $1,821 $231 Pre-tax earnings / (loss) $ 227 N.M. (84)% $ (799) N.M. $1,084 $527 $935 $137 Net earnings / (loss) $ 195 N.M. (83)% $ (664) N.M. $160 $36 $100 $ 181 N.M. (83)% $ (717) N.M. Net earnings / (loss) to common $1,027 $1,008 $724 $ 24,587 1% (5)% $ 24,358 (4)% Average common equity $(221) 3Q21 2Q22 3Q22 2.9% 9.2pp (14.1)pp (3.9)% (34.8)pp Return on average common equity Management and other fees Incentive fees Equity investments Lending and debt investments 12

Asset Management – Asset Mix 5 5 Equity Investments of $16 billion Lending and Debt Investments of $24 billion ~$13 billion Private, ~$3 billion Public 4% 4% 17% 7% By Vintage By Region 27% 10% 45% 66% 2019-thereafter Americas By Industry Loan Portfolio $12 billion 25% 18% Loans 11% 2016-2018 Asia 30% 16% $12 billion 2015 or earlier EMEA 83% 25% 12% Debt investments Real Estate: Multifamily 8%, Mixed Use 7%, Other 7%, Office 5% 6 5 Consolidated Investment Entities of $13 billion 6 Funded with liabilities of ~$7 billion 3% 4% 3% 4% 8% By Vintage By Region By Accounting By Region 7% 23% 27% Classification 50% 68% 12% 47% 11% 13% 2019-thereafter Americas Loans at FV/Held for sale Americas By Industry 46% 10% By Asset Class 38% 19% 2016-2018 Asia Loans at amortized cost Asia 12% 4% 50% 34% 22% 14% 22% 2015 or earlier EMEA Debt investments at FV EMEA 22% 13% 14% 13

Consumer & Wealth Management Financial Results Consumer & Wealth Management Highlights vs. n 3Q22 net revenues were a record and higher YoY vs. vs. 3Q22 3Q21 $ in millions 3Q22 2Q22 3Q21 YTD YTD — Wealth management net revenues were essentially unchanged o Management and other fees were essentially unchanged YoY despite recent market Management and other fees $ 1,217 (1)% – $ 3,696 8% depreciation Incentive fees 21 (13)% (83)% 72 (56)% o Incentive fees were significantly lower, driven by harvesting in 3Q21 o Private banking and lending net revenues were significantly higher, reflecting higher Private banking and lending 395 23% 35% 1,054 29% loan and deposit balances — Consumer banking net revenues were nearly double the amount in 3Q21, primarily 1,633 4% – 4,822 10% Wealth management reflecting significantly higher credit card balances and higher deposit spreads n 3Q22 provision for credit losses primarily reflected growth in credit cards and net charge-offs 744 22% 95% 1,835 64% Consumer banking Consumer & Wealth Management Net Revenues ($ in millions) Net revenues 2,377 9% 18% 6,657 21% $2,377 Provision for credit losses 451 14% 205% 1,099 301% $2,176 $2,018 $744 Operating expenses 1,888 10% 16% 5,221 16% $608 $382 $292 $ 38 (38)% (84)% $ 337 (54)% Pre-tax earnings $395 $320 $121 $24 $21 Net earnings $ 30 (39)% (84)% $ 280 (52)% $1,223 $1,224 $1,217 Net earnings to common $ 18 (49)% (90)% $ 244 (56)% Average common equity $ 15,925 5% 48% $ 14,866 42% 3Q21 2Q22 3Q22 0.5% (0.4)pp (6.2)pp 2.2% (4.9)pp Return on average common equity Management and other fees Incentive fees Private banking and lending Consumer banking 14

Asset Management and Consumer & Wealth Management Details 4,5 4,5 Firmwide Assets Under Supervision Highlights n Firmwide AUS decreased $68 billion during the quarter, as Asset Management AUS decreased $ in billions 3Q22 2Q22 3Q21 $64 billion and Consumer & Wealth Management AUS decreased $4 billion Asset Management $ 1,760 $ 1,824 $ 1,678 — Liquidity products net inflows of $18 billion and long-term net inflows of $9 billion Consumer & Wealth Management 667 671 694 — Net inflows from acquisitions / (dispositions) of $4 billion included the acquisition of NextCapital Firmwide AUS $ $ $ 2,427 2,495 2,372 — Net market depreciation of $99 billion, driven by fixed income and equity assets n Firmwide Management and other fees increased 15% YoY Firmwide Management and Other Fees/Incentive Fees 4,5 3Q22 AUS Mix vs. vs. vs. 3Q22 3Q21 11% $ in millions 3Q22 2Q22 3Q21 YTD YTD 28% 37% 1,027 2% 42% $ 2,807 31% Asset Management $ 39% 21% Asset Distribution 1,217 (1)% – 3,696 8% Consumer & Wealth Management Class Channel Total Management and other fees $ 2,244 1% 15% $ 6,503 17% 29% 35% Asset Management 36 (78)% (64)% $ 248 13% $ 21 (13)% (83)% 72 (56)% 7% Consumer & Wealth Management 12% Total Incentive fees $ 57 (69)% (74)% $ 320 (16)% 21% Vehicle Region 53% 35% 72% 15

Net Interest Income and Loans 5 Net Interest Income by Segment ($ in millions) Loans Metrics $ in billions 3Q22 2Q22 3Q21 Corporate $ 63 $ 62 $ 54 $2,043 2.9% ALLL to Total Wealth management 50 48 42 $1,734 Gross Loans, at $1,564 Amortized Cost Commercial real estate 26 28 22 $1,208 $974 $690 Residential real estate 15 17 13 1.7% ALLL to Gross $105 Installment 5 5 3 Wholesale Loans, at $79 $118 Amortized Cost $553 $668 Credit cards 14 12 6 $487 12.6% $203 $155 $101 Other 9 9 6 ALLL to Gross 3Q21 2Q22 3Q22 Consumer Loans, at Allowance for loan losses (5) (5) (3) Amortized Cost Investment Banking Global Markets Asset Management Consumer & Wealth Management Total Loans $ 177 $ 176 $ 143 Net Interest Income Highlights Lending Highlights n Total loans were up slightly QoQ, primarily reflecting growth in credit cards and wealth management n 3Q22 net interest income increased $479 million YoY loans, offset by a decrease in real estate loans n The YoY increase in net interest income primarily reflected higher loan balances and rates n Total allowance was $5.59 billion (including $4.85 billion for funded loans), up ~$0.32 billion QoQ — $3.16 billion for wholesale loans, $2.43 billion for consumer loans n Provision for credit losses of $515 million in 3Q22, compared with $175 million in 3Q21 n 3Q22 net charge-offs of $172 million for an annualized net charge-off rate of 0.4%, unchanged QoQ — Wholesale annualized net charge-off rate of 0.1%, down 10bps QoQ — Consumer annualized net charge-off rate of 2.9%, up 60bps QoQ 16

Expenses Financial Results Expense Highlights vs. n 3Q22 total operating expenses increased YoY vs. vs. 3Q22 3Q21 — Compensation and benefits expenses were higher, reflecting a smaller reduction in the 3Q22 2Q22 3Q21 YTD YTD $ in millions year-to-date ratio of compensation and benefits to net revenues, net of provision for credit losses, compared to 3Q21 Compensation and benefits $ 3,606 (2)% 14% $ 11,384 (21)% — Non-compensation expenses were significantly higher, reflecting: Transaction based 1,317 – 16% 3,878 10% o Higher expenses related to growth initiatives (including acquisitions) o Higher net provisions for litigation and regulatory proceedings Market development 199 (15)% 21% 596 66% o Higher business activity n 3Q22 YTD effective income tax rate was 16.9%, up from 16.3% for the first half of 2022, Communications and technology 459 3% 16% 1,327 16% primarily due to a decrease in the impact of tax benefits on the settlement of employee share- based awards in the first nine months of 2022 compared with the first half of 2022 666 17% 31% 1,728 13% Depreciation and amortization 4 Efficiency Ratio 255 (2)% 7% 765 5% Occupancy 62.7% 465 (5)% 7% 1,392 22% Professional fees 52.8% 737 15% 36% 2,003 12% Other expenses 7,704 1% 17% $ 23,073 (6)% Total operating expenses $ 687 11% (53)% $ 2,021 (53)% Provision for taxes $ 16.9% (2.7)pp Effective Tax Rate 17 3Q21 YTD 3Q22 YTD

Capital and Balance Sheet 4,5 Capital Capital and Balance Sheet Highlights n Both Standardized and Advanced CET1 capital ratios increased QoQ $ in billions 3Q22 2Q22 3Q21 — CET1 capital increased, reflecting net earnings in excess of share repurchases and Common Equity Tier 1 (CET1) capital $ 98.7 $ 98.3 $ 93.3 dividends — Standardized RWAs reflected a decrease in market RWAs on reduced exposures, partially Standardized RWAs $ 689 $ 692 $ 664 offset by an increase in credit RWAs on increased exposures — Advanced RWAs primarily reflected a decrease in market RWAs on reduced exposures Standardized CET1 capital ratio 14.3% 14.2% 14.1% n As of October 1, 2022, the firm’s Standardized CET1 capital ratio requirement is 13.3%, reflecting an SCB of 6.3% Advanced RWAs $ 675 $ 686 $ 672 n Returned $1.89 billion of capital to common shareholders during the quarter Advanced CET1 capital ratio 14.6% 14.3% 13.9% 4 — 3.0 million common shares repurchased for a total cost of $1.00 billion — $893 million of common stock dividends Supplementary leverage ratio (SLR) 5.6% 5.6% 5.6% n BVPS increased 2.1% QoQ, driven by net earnings 5 Selected Balance Sheet Data Book Value $ in billions 3Q22 2Q22 3Q21 In millions, except per share amounts 3Q22 2Q22 3Q21 Total assets $ 1,557 $ 1,601 $ 1, 443 4 Basic shares 352.3 355.0 347.5 Deposits $ 395 $ 391 $ 333 Book value per common share $ 308.22 $ 301.88 $ 277.25 Unsecured long-term borrowings $ 240 $ 251 $ 243 1 Tangible book value per common share $ 284.80 $ 278.75 $ 263.37 Shareholders’ equity $ 119 $ 118 $ 106 4 Average GCLA $ 417 $ 391 $ 356 18

Cautionary Note Regarding Forward-Looking Statements This presentation contains “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements are not historical facts or statements of current conditions, but instead represent only the firm’s beliefs regarding future events, many of which, by their nature, are inherently uncertain and outside of the firm’s control. It is possible that the firm’s actual results, financial condition and liquidity may differ, possibly materially, from the anticipated results, financial condition and liquidity in these forward-looking statements. For information about some of the risks and important factors that could affect the firm’s future results, financial condition and liquidity and the forward-looking statements below, see “Risk Factors” in Part I, Item 1A of the firm’s Annual Report on Form 10-K for the year ended December 31, 2021. Information regarding the firm’s assets under supervision, capital ratios, risk-weighted assets, supplementary leverage ratio, balance sheet data and global core liquid assets (GCLA) consists of preliminary estimates. These estimates are forward-looking statements and are subject to change, possibly materially, as the firm completes its financial statements. Statements regarding (i) estimated GDP growth and interest rate and inflation trends, (ii) the impact of the COVID-19 pandemic on the firm’s business, results, financial position and liquidity, (iii) the timing, profitability, benefits and other prospective aspects of business initiatives, business realignment and the achievability of medium- and long-term targets and goals, (iv) the future state of the firm’s liquidity and regulatory capital ratios (including the firm’s stress capital buffer and G-SIB buffer), (v) the firm’s prospective capital distributions (including dividends and repurchases), (vi) the firm’s future effective income tax rate, (vii) the firm’s investment banking transaction backlog and future results, (viii) the firm’s planned 2022 benchmark debt issuances, and (ix) the impact of Russia’s invasion of Ukraine and related sanctions and other developments on the firm’s business, results and financial position, are forward-looking statements. Statements regarding estimated GDP growth and interest rate and inflation trends are subject to the risk that actual GDP growth and interest rate and inflation trends may differ, possibly materially, due to, among other things, changes in general economic conditions and monetary and fiscal policy. Statements about the effects of the COVID-19 pandemic on the firm’s business, results, financial position and liquidity are subject to the risk that the actual impact may differ, possibly materially, from what is currently expected. Statements about the timing, profitability, benefits and other prospective aspects of business initiatives, business realignment and the achievability of medium and long-term targets and goals are based on the firm’s current expectations regarding the firm’s ability to effectively implement these initiatives and realignment and achieve these targets and goals and may change, possibly materially, from what is currently expected. Statements about the future state of the firm’s liquidity and regulatory capital ratios (including the firm’s stress capital buffer and G-SIB buffer), as well as its prospective capital distributions, are subject to the risk that the firm’s actual liquidity, regulatory capital ratios and capital distributions may differ, possibly materially, from what is currently expected. Statements about the firm’s future effective income tax rate are subject to the risk that the firm’s future effective income tax rate may differ from the anticipated rate indicated, possibly materially, due to, among other things, changes in the tax rates applicable to the firm, the firm’s earnings mix or profitability, the entities in which the firm generates profits and the assumptions made in forecasting the firm’s expected tax rate, and potential future guidance from the U.S. IRS. Statements about the firm’s investment banking transaction backlog and future results are subject to the risk that transactions may be modified or may not be completed at all, and related net revenues may not be realized or may be materially less than expected. Important factors that could have such a result include, for underwriting transactions, a decline or weakness in general economic conditions, an outbreak or worsening of hostilities, including the escalation or continuation of the war between Russia and Ukraine, continuing volatility in the securities markets or an adverse development with respect to the issuer of the securities and, for financial advisory transactions, a decline in the securities markets, an inability to obtain adequate financing, an adverse development with respect to a party to the transaction or a failure to obtain a required regulatory approval. Statements regarding the firm’s planned 2022 benchmark debt issuances are subject to the risk that actual issuances may differ, possibly materially, due to changes in market conditions, business opportunities or the firm’s funding needs. Statements about the impact of Russia’s invasion of Ukraine and related sanctions and other developments on the firm’s business, results and financial position are subject to the risks that hostilities may escalate and expand, that sanctions may increase and that the actual impact may differ, possibly materially, from what is currently expected. 19

Footnotes 1. Annualized return on average common shareholders’ equity (ROE) is calculated by dividing annualized net earnings applicable to common shareholders by average monthly common shareholders’ equity. Annualized return on average tangible common shareholders’ equity (ROTE) is calculated by dividing annualized net earnings applicable to common shareholders by average monthly tangible common shareholders’ equity. Tangible common shareholders’ equity is calculated as total shareholders’ equity less preferred stock, goodwill and identifiable intangible assets. Tangible book value per common share (TBVPS) is calculated by dividing tangible common shareholders’ equity by basic shares. Management believes that tangible common shareholders’ equity and TBVPS are meaningful because they are measures that the firm and investors use to assess capital adequacy and that ROTE is meaningful because it measures the performance of businesses consistently, whether they were acquired or developed internally. Tangible common shareholders’ equity, ROTE and TBVPS are non-GAAP measures and may not be comparable to similar non-GAAP measures used by other companies. The table below presents a reconciliation of average and ending common shareholders’ equity to average and ending tangible common shareholders’ equity: AVERAGE FOR THE AS OF THREE MONTHS ENDED NINE MONTHS ENDED Unaudited, $ in millions SEPTEMBER 30, 2022 SEPTEMBER 30, 2022 SEPTEMBER 30, 2022 JUNE 30, 2022 SEPTEMBER 30, 2021 Total shareholders’ equity $ 118,013 $ 115,418 $ 119,290 $ 117,871 $ 106,297 Preferred stock (10,703) (10,703) (10,703) (10,703) (9,953) Common shareholders’ equity 107,310 104,715 108,587 107,168 96,344 Goodwill (6,242) (5,546) (6,288) (6,196) (4,326) Identifiable intangible assets (1,987) (1,463) (1,963) (2,014) (497) Tangible common shareholders’ equity $ 99,081 $ 97,706 $ 100,336 $ 98,958 $ 91,521 2. Dealogic – Based on M&A and Equity & equity-related offerings volumes, for January 1, 2022 through September 30, 2022. 3. Investment Banking and Global Markets wallet share gains from full year 2019 to first half of 2022. Book value per share (BVPS) growth from December 31, 2019 to June 30, 2022. Wallet share data based on reported revenues for Advisory, Equity underwriting and Debt underwriting for Investment Banking and for FICC and Equities for Global Markets. Total wallet includes GS, MS, JPM, BAC, C, DB, UBS, CS, BARC. 4. For information about the following items, see the referenced sections in Part I, Item 2 “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the firm’s Quarterly Report on Form 10-Q for the period ended June 30, 2022: (i) investment banking transaction backlog – see “Results of Operations – Investment Banking” (ii) assets under supervision – see “Results of Operations – Assets Under Supervision” (iii) efficiency ratio – see “Results of Operations – Operating Expenses” (iv) basic shares – see “Balance Sheet and Funding Sources – Balance Sheet Analysis and Metrics” (v) share repurchase program – see “Capital Management and Regulatory Capital – Capital Management” and (vi) global core liquid assets – see “Risk Management – Liquidity Risk Management.” For information about risk-based capital ratios and the supplementary leverage ratio, see Note 20 “Regulation and Capital Adequacy” in Part I, Item 1 “Financial Statements (Unaudited)” in the firm’s Quarterly Report on Form 10-Q for the period ended June 30, 2022. 5. Represents a preliminary estimate for the third quarter of 2022 and may be revised in the firm’s Quarterly Report on Form 10-Q for the period ended September 30, 2022. 6. Includes consolidated investment entities, substantially all of which are engaged in real estate investment activities. These assets are generally accounted for at historical cost less depreciation. Substantially all liabilities are nonrecourse, thereby reducing the firm’s equity at risk. Amounts by vintage, region and asset class are net of financings. 20