Wall Street giant Goldman Sachs shattered forecasts on Tuesday with US$3.44 billion in quarterly profits after paying back a US government bailout, suggesting the financial crisis is easing.
Goldman, which reimbursed a US$10 billion federal bailout in full in the second quarter, said its net profit soared 65 percent thanks to robust trading operations.
The prestigious financial firm is the first of the “big guns” in the sector to report second-quarter results. Rounding out the week is JPMorgan Chase today, followed by Bank of America and Citigroup tomorrow.
Goldman reported earnings per share of US$4.93, besting analysts’ forecast of US$3.54.
“While markets remain fragile and we recognize the challenges the broader economy faces, our second-quarter results reflected the combination of improving financial market conditions and a deep and diverse client franchise,” chairman and chief executive Lloyd Blankfein said in a statement.
Goldman, the last of the major Wall Street investment banks left standing after the financial meltdown late last year, said that excluding its payback of government aid under the US Treasury’s Troubled Asset Relief Program (TARP), it had earnings per share of US$5.71.
Last month Goldman was among 10 major US banks repaying the Treasury for the capital injections, in a sign of a stabilizing financial system.
A number of firms were eager to get out from under the TARP, in part to escape federal scrutiny of executive compensation.
Goldman’s gold-plated earnings came as investors fretted about embattled CIT Group, a major player in industrial loans.
CIT, which operates in more than 50 countries and provides financial services to small and medium-sized businesses, is seeking fresh government aid to avoid collapse.
The Wall Street Journal reported yesterday that CIT was nearing a deal in its talks with federal regulators to obtain a government aid package. The cash-strapped company’s board, it said, had discussed a number as high as US$775 million for the drawdowns.
US government officials are split over the amount of aid that should be given to CIT and, some say, CIT is seeking to exaggerate the consequences of its potential collapse, the newspaper said.
“There is also the risk that propping up CIT will reinforce the stigma that Washington will bail out companies that aren’t even considered too big to fail,” it said.
A global survey showed that 60 percent of Taiwanese had attained higher education, second only to Canada, the Ministry of the Interior said. Taiwan easily surpassed the global average of 43 percent and ranked ahead of major economies, including Japan, South Korea and the US, data from the Organisation for Economic Co-operation and Development (OECD) for 2024 showed. Taiwan has a high literacy rate, data released by the ministry showed. As of the end of last year, Taiwan had 20.617 million people aged 15 or older, accounting for 88.5 percent of the total population, with a literacy rate of 99.4 percent, the data
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