Pending SEC investigation of GS on the ABACUS security trading.
SEC's investigation of Goldman's involvement in the sale of ABACUS security.
Goldman reported on March 18th that it had earned $1.51 billion in the first quarter of its fiscal 2008. While this was down 53% from the same quarter in 2007, it still beat analysts expectations by a wide margin. This, combined with upbeat news from Lehman Brothers and a Fed rate cut on the same day, sent stocks up in both the U.S. and on international exchanges.
Goldman Sachs announced that it has received permission to rebuy the preferred stocks from the US Treasury issued through the Troubled Asset Relief Program (TARP)
Goldman Sachs owns approximately $8.75B in stakes in the ICBC. It is free to sell up to 20% of it until April 2010 and may do so to raise capital.
GS posted a 4Q loss of $2.12B. This is its first loss since it went public in 1999.
The Wall Street Journal speculated that GS will report a Q4 loss of up to $5 a share, which is over 5 times analyst expectations.
From BusinessWeek: "Within 14 hours of Buffett's ride to the rescue of Goldman Sachs (GS), with a $5 billion cash infusion and warm praise for the struggling investment banking titan, Goldman on Sept. 24 found other investors to snap up $5 billion worth of its stock."
GS tumbled along with all the other big brokerage houses as investors worried that some may not have access to enough capital to stay afloat as the housing bubble continues to burst and the severity of the credit crunch is realized, forcing massive write downs on their assets.
For the second quarter of FY2008, Goldman earned $2.05 billion on net revenue of $9.42 billion. While this was about 11% less than its profit in the second quarter of 2007, analysts had been expecting a sharper decline in net income.
On December 18, Goldman released its earnings report for 4Q2007, which showed net revenue of $10.74 billion and net income of $3.22 billion. These results exceeded analysts' general expectations, though the stock price fell throughout the day on warnings about the difficulty facing the industry in the future.
In a November 13 announcement, Goldman's CEO stated that the company would not further write-down the values of any of its holdings. The announcement came a day after a Punk Ziegel analyst upgraded his outlook on the firm. Given its relatively small write-down of $1.48 billion in the third quarter, this news further bolstered investor confidence in Goldman's ability to navigate the tumultuous credit markets. Goldman's stock rose 5.9% on November 13, and helped push financial stocks up across the board.
In September, it becomes increasingly clear that Goldman Sachs has not been hit with the kind of subprime losses that plagued its competitors. In particular, on September 20th, Goldman reports record profits even as Bear Stearns deals with the collapse of two of its hedge funds due to subprime bets.
As with many U.S. financial services firms, Goldman Sachs has seen its stock discounted substantially over the past months. Concerns about the housing market, subprime lending, and the possibility of a meltdown in the private equity market have led to a worldwide decline in stock prices, especially for firms such as Goldman, whose performance is particularly correlated to general economic conditions.
Goldman Sachs announced on August 9, that a second of its hedge funds was suffering losses and, as a result, was forced to sell positions. On Monday, August 13, Goldman announced that two of its funds had lost around 30% of their value in about a week's time. It then stated that $3 billion ($2 billion from Goldman itself) had been pumped into these funds. The firm says these investments were not bailouts but their taking advantage of discounted prices.
Lord Browne of British Petroleum is expected to resign from Goldman Sachs' Board of Directors. Goldman Sachs' stock price rose by 1.60%.
Evenlyn Davis, a shareholder of the company, asks the Goldman Sachs' Board of Directors to end the practice of stock options used to compensate executives. Goldman Sachs' stock price rose by 4.20%.
Goldman announces the launch of an Indian mutual fund. Already AIG and JPMorgan have announced plans to enter the same market. Goldman Sachs' stock price fell by 2.46%.