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Goldman Sachs Reports Earnings Per Common Share of $14.13 for 2012



  Goldman Sachs Reports Earnings Per Common Share of $14.13 for 2012

             Fourth Quarter Earnings Per Common Share Were $5.60

Business Wire

NEW YORK -- January 16, 2013

The Goldman Sachs Group, Inc. (NYSE: GS) today reported net revenues of
$34.16 billion and net earnings of $7.48 billion for the year ended
December 31, 2012. Diluted earnings per common share were $14.13 compared with
$4.51 for the year ended December 31, 2011. Return on average common
shareholders’ equity (ROE) ^(1) was 10.7% for 2012.

Fourth quarter net revenues were $9.24 billion and net earnings were
$2.89 billion. Diluted earnings per common share were $5.60 compared with
$1.84 for the fourth quarter of 2011 and $2.85 for the third quarter of 2012.
Annualized ROE ^(1) was 16.5% for the fourth quarter of 2012.

                              Annual Highlights

  * Goldman Sachs continued its leadership in investment banking, ranking
    first in worldwide announced and completed mergers and acquisitions for
    the year. ^(2)
  * The firm ranked first in worldwide equity and equity-related offerings and
    common stock offerings for the year. ^(2)
  * Debt underwriting produced net revenues of $1.96 billion, which is the
    second best annual performance and the highest since 2007.
  * Fixed Income, Currency and Commodities Client Execution generated net
    revenues of $9.91 billion, including strong results in mortgages and solid
    results in credit products and interest rate products.
  * Book value per common share increased approximately 11% to $144.67 and
    tangible book value per common share ^(3) increased approximately 12% to
    $134.06 compared with the end of 2011.
  * The firm continues to manage its liquidity and capital conservatively. The
    firm’s global core excess liquidity ^(4) was $175 billion ^(5) as of
    December 31, 2012. In addition, the firm’s Tier 1 capital ratio under
    Basel 1 ^(6) was 16.7% ^(5) and the firm’s Tier 1 common ratio under
    Basel 1 ^(7) was 14.5% ^(5) as of December 31, 2012.

                                _____________

“While economic conditions remained challenging for much of last year, the
strengths of our business model and client franchise, coupled with our focus
on disciplined management, delivered solid performance for our shareholders,”
said Lloyd C. Blankfein, Chairman and Chief Executive Officer. “The firm’s
strategic position provides a solid basis on which to grow and generate
superior returns.”

                                 Net Revenues

Investment Banking

Full Year
Net revenues in Investment Banking were $4.93 billion for 2012, 13% higher
than 2011. Net revenues in Financial Advisory were $1.98 billion, essentially
unchanged compared with 2011. Net revenues in the firm’s Underwriting business
were $2.95 billion, 25% higher than 2011, due to strong net revenues in debt
underwriting. Net revenues in debt underwriting were significantly higher
compared with 2011, primarily reflecting higher net revenues from
investment-grade and leveraged finance activity. Net revenues in equity
underwriting were lower compared with 2011, primarily reflecting a decline in
industry-wide initial public offerings.

Fourth Quarter
Net revenues in Investment Banking were $1.41 billion for the fourth quarter
of 2012, 64% higher than the fourth quarter of 2011 and 21% higher than the
third quarter of 2012. Net revenues in Financial Advisory were $508 million,
8% higher than the fourth quarter of 2011, primarily reflecting an increase in
industry-wide completed mergers and acquisitions. Net revenues in the firm’s
Underwriting business were $897 million, more than double the amount in the
fourth quarter of 2011. Net revenues in both debt underwriting and equity
underwriting were significantly higher compared with the fourth quarter of
2011, primarily reflecting an increase in industry-wide activity.

The firm’s investment banking transaction backlog increased compared with both
the end of the third quarter of 2012 and the end of 2011. ^(8)

Institutional Client Services

Full Year
Net revenues in Institutional Client Services were $18.12 billion for 2012, 5%
higher than 2011.

Net revenues in Fixed Income, Currency and Commodities Client Execution were
$9.91 billion for 2012, 10% higher than 2011. These results reflected strong
net revenues in mortgages, which were significantly higher compared with 2011.
In addition, net revenues in credit products and interest rate products were
solid and higher compared with 2011. These increases were partially offset by
significantly lower net revenues in commodities and slightly lower net
revenues in currencies. Although broad market concerns persisted during 2012,
Fixed Income, Currency and Commodities Client Execution operated in a
generally improved environment characterized by tighter credit spreads and
less challenging market-making conditions compared with 2011.

Net revenues in Equities were $8.21 billion for 2012, essentially unchanged
compared with 2011. Net revenues in securities services were significantly
higher compared with 2011, reflecting a gain of approximately $500 million on
the sale of the firm’s hedge fund administration business. In addition,
equities client execution net revenues were higher than 2011, primarily
reflecting significantly higher results in cash products, principally due to
increased levels of client activity. These increases were partially offset by
lower commissions and fees, reflecting lower market volumes. During 2012,
Equities operated in an environment generally characterized by an increase in
global equity prices and lower volatility levels.

The net loss attributable to the impact of changes in the firm’s own credit
spreads on borrowings for which the fair value option was elected was
$714 million ($433 million and $281 million related to Fixed Income, Currency
and Commodities Client Execution and equities client execution, respectively)
for 2012, compared with a net gain of $596 million ($399 million and
$197 million related to Fixed Income, Currency and Commodities Client
Execution and equities client execution, respectively) for 2011.

Fourth Quarter
Net revenues in Institutional Client Services were $4.34 billion for the
fourth quarter of 2012, 42% higher than the fourth quarter of 2011 and 4%
higher than the third quarter of 2012.

Net revenues in Fixed Income, Currency and Commodities Client Execution were
$2.04 billion for the fourth quarter of 2012, 50% higher than the fourth
quarter of 2011, reflecting significantly higher net revenues in credit
products and mortgages compared with difficult market-making conditions during
the fourth quarter of 2011, and higher net revenues in currencies. These
increases were partially offset by significantly lower net revenues in
commodities and lower net revenues in interest rate products. During the
fourth quarter of 2012, Fixed Income, Currency and Commodities Client
Execution operated in an environment characterized by generally tighter credit
spreads and improved activity levels in credit products and mortgages compared
with the fourth quarter of 2011.

Net revenues in Equities were $2.30 billion for the fourth quarter of 2012,
36% higher than the fourth quarter of 2011, reflecting significantly higher
net revenues in securities services and equities client execution. The
increase in securities services net revenues compared with the fourth quarter
of 2011 reflected a gain of approximately $500 million on the sale of the
firm’s hedge fund administration business. The increase in equities client
execution net revenues compared with the fourth quarter of 2011 reflected
significantly higher net revenues in derivatives and higher net revenues in
reinsurance. These increases were partially offset by lower commissions and
fees, reflecting lower market volumes. During the quarter, Equities operated
in an environment generally characterized by low volatility levels and an
increase in equity prices in Asia and Europe.

The net loss attributable to the impact of changes in the firm’s own credit
spreads on borrowings for which the fair value option was elected was
$126 million ($79 million and $47 million related to Fixed Income, Currency
and Commodities Client Execution and equities client execution, respectively)
for the fourth quarter of 2012. The net gain attributable to the impact of
changes in the firm’s own credit spreads on borrowings for which the fair
value option was elected was $20 million (all related to equities client
execution) for the fourth quarter of 2011.

Investing & Lending

Full Year
Net revenues in Investing & Lending were $5.89 billion for 2012. Investing &
Lending net revenues were positively impacted by tighter credit spreads and an
increase in global equity prices. Results for 2012 included a gain of
$408 million from the firm’s investment in the ordinary shares of Industrial
and Commercial Bank of China Limited (ICBC), net gains of $2.39 billion from
other investments in equities, primarily in private equities, net gains and
net interest income of $1.85 billion from debt securities and loans, and other
net revenues of $1.24 billion, principally related to the firm’s consolidated
investment entities.

Fourth Quarter
Net revenues in Investing & Lending were $1.97 billion for the fourth quarter
of 2012. Investing & Lending net revenues were positively impacted by
generally tighter credit spreads and an increase in equity prices in Asia and
Europe. Results for the fourth quarter of 2012 included a gain of $334 million
from the firm’s investment in the ordinary shares of ICBC, net gains of
$789 million from other investments in equities, primarily in private
equities, net gains and net interest income of $485 million from debt
securities and loans, and other net revenues of $365 million, principally
related to the firm’s consolidated investment entities.

Investment Management

Full Year
Net revenues in Investment Management were $5.22 billion for 2012, 4% higher
than 2011, due to significantly higher incentive fees, partially offset by
lower transaction revenues and slightly lower management and other fees.
During the year, assets under supervision ^(9) increased $70 billion to
$965 billion. Assets under management increased $26 billion to $854 billion,
reflecting net market appreciation of $44 billion, primarily in fixed income
and equity assets, partially offset by net outflows of $18 billion. Net
outflows included outflows in equity, alternative investment and money market
assets, partially offset by inflows in fixed income assets ^(10). Other client
assets increased $44 billion to $111 billion, primarily due to net
inflows ^(10).

Fourth Quarter
Net revenues in Investment Management were $1.52 billion for the fourth
quarter of 2012, 20% higher than the fourth quarter of 2011 and 26% higher
than the third quarter of 2012. The increase in net revenues compared with the
fourth quarter of 2011 was primarily due to significantly higher incentive
fees and higher management and other fees. During the quarter, assets under
supervision increased $14 billion to $965 billion. Assets under management
decreased $2 billion to $854 billion, reflecting net outflows of
$7 billion ^(10), partially offset by net market appreciation of $5 billion.
Net outflows included outflows in fixed income, equity and alternative
investment assets, partially offset by inflows in money market assets. Other
client assets increased $16 billion to $111 billion, primarily due to net
inflows.

                                   Expenses

Operating expenses were $22.96 billion for 2012, essentially unchanged
compared with 2011.

Compensation and Benefits

Compensation and benefits expenses (including salaries, discretionary
compensation, amortization of equity awards and other items such as benefits)
were $12.94 billion for 2012, 6% higher than 2011. The ratio of compensation
and benefits to net revenues for 2012 was 37.9% compared with 42.4% for 2011.
Total staff ^(11) decreased 3% compared with the end of 2011.

Non-Compensation Expenses

Full Year
Non-compensation expenses were $10.01 billion for 2012, 4% lower than 2011.
The decrease compared with 2011 primarily reflected the impact of expense
reduction initiatives, lower brokerage, clearing, exchange and distribution
fees, lower occupancy expenses and lower impairment charges. These decreases
were partially offset by higher other expenses and increased reserves related
to the firm’s reinsurance business. The increase in other expenses compared
with 2011 primarily reflected higher net provisions for litigation and
regulatory proceedings and higher charitable contributions.

Fourth Quarter
Non-compensation expenses were $2.95 billion for the fourth quarter of 2012,
14% higher than the fourth quarter of 2011 and 24% higher than the third
quarter of 2012. The increase compared with the fourth quarter of 2011 was due
to higher other expenses. The increase in other expenses primarily reflected
higher net provisions for litigation and regulatory proceedings and higher
charitable contributions.

The fourth quarter of 2012 included $260 million of net provisions for
litigation and regulatory proceedings (including the settlement with the
Federal Reserve Board regarding the independent foreclosure review) and
$157 million of charitable contributions to Goldman Sachs Gives. The fourth
quarter of 2011 included $47 million of net provisions for litigation and
regulatory proceedings and $78 million of charitable contributions to Goldman
Sachs Gives. Compensation was reduced in both 2012 and 2011 to fund the
charitable contribution to Goldman Sachs Gives.

Provision for Taxes

The effective income tax rate for 2012 was 33.3%, essentially unchanged from
33.5% for the first nine months of 2012 and up from 28.0% for 2011. The
increase from 28.0% to 33.3% was primarily due to the earnings mix and a
decrease in the impact of permanent benefits.

                                   Capital

As of December 31, 2012, total capital was $243.02 billion, consisting of
$75.72 billion in total shareholders’ equity (common shareholders’ equity of
$69.52 billion and preferred stock of $6.20 billion) and $167.30 billion in
unsecured long-term borrowings. Book value per common share was $144.67, an
increase of approximately 11% compared with the end of 2011 and approximately
3% compared with the end of the third quarter of 2012. Tangible book value per
common share ^(3) was $134.06, an increase of approximately 12% compared with
the end of 2011 and approximately 3% compared with the end of the third
quarter of 2012. Book value and tangible book value per common share are based
on common shares outstanding, including restricted stock units granted to
employees with no future service requirements, of 480.5 million as of
December 31, 2012.

On October 24, 2012, The Goldman Sachs Group, Inc. (Group Inc.) issued 34,000
shares of perpetual 5.95% Non-Cumulative Preferred Stock, Series I (Series I
Preferred Stock), for aggregate proceeds of $850 million.

During the year, the firm repurchased 42.0 million shares of its common stock
at an average cost per share of $110.31, for a total cost of $4.64 billion,
including 12.7 million shares during the fourth quarter at an average cost per
share of $120.11, for a total cost of $1.53 billion. The remaining share
authorization under the firm’s existing repurchase program is 21.5 million
shares. ^(12)

Under the regulatory capital requirements currently applicable to bank holding
companies (Basel 1), the firm’s Tier 1 capital ratio ^(6) was 16.7% ^(5) and
the firm’s Tier 1 common ratio ^(7) was 14.5% ^(5) as of December 31, 2012, up
from 15.0% and 13.1%, respectively, compared with September 30, 2012.

                  Other Balance Sheet and Liquidity Metrics

  * The firm’s global core excess liquidity (GCE) ^(4) was $175 billion ^(5)
    as of December 31, 2012 and averaged $173 billion ^(5) for the fourth
    quarter of 2012, compared with an average of $175 billion for the third
    quarter of 2012. GCE averaged $172 billion ^(5) for 2012, compared with an
    average of $166 billion for 2011.
  * Total assets ^ were $939 billion ^(5) as of December 31, 2012, compared
    with $949 billion as of September 30, 2012 and $923 billion as of
    December 31, 2011.
  * Level 3 assets ^ were $47 billion ^(5) as of December 31, 2012, compared
    with $48 billion for both September 30, 2012 and December 31, 2011, and
    represented 5.0% of total assets.

                                  Dividends

Group, Inc. declared a dividend of $0.50 per common share to be paid on
March 28, 2013 to common shareholders of record on February 28, 2013. The firm
also declared dividends of $234.38, $387.50, $250.00, $250.00 and $437.99 per
share of Series A Preferred Stock, Series B Preferred Stock, Series C
Preferred Stock, Series D Preferred Stock and Series I Preferred Stock,
respectively (represented by depositary shares, each representing a 1/1,000th
interest in a share of preferred stock), to be paid on February 11, 2013 to
preferred shareholders of record on January 27, 2013. In addition, the firm
declared dividends of $977.78 per each share of Series E Preferred Stock and
Series F Preferred Stock, to be paid on March 1, 2013 to preferred
shareholders of record on February 14, 2013.

                                ______________

The Goldman Sachs Group, Inc. is a leading global investment banking,
securities and investment management firm that provides a wide range of
financial services to a substantial and diversified client base that includes
corporations, financial institutions, governments and high-net-worth
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, 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 and financial condition may differ,
possibly materially, from the anticipated results and financial condition
indicated in these forward-looking statements. For a discussion of some of the
risks and important factors that could affect the firm’s future results and
financial condition, see “Risk Factors” in Part I, Item 1A of the firm’s
Annual Report on Form 10-K for the year ended December 31, 2011.

Certain of the information regarding the firm’s capital ratios, risk-weighted
assets, total assets, level 3 assets and global core excess liquidity consist
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 also may
constitute forward-looking statements. Such statements are subject to the risk
that the terms of these transactions may be modified or that they may not be
completed at all; therefore, the net revenues, if any, that the firm actually
earns from these transactions may differ, possibly materially, from those
currently expected. Important factors that could result in a modification of
the terms of a transaction or a transaction not being completed include, in
the case of underwriting transactions, a decline or continued weakness in
general economic conditions, outbreak of hostilities, volatility in the
securities markets generally or an adverse development with respect to the
issuer of the securities and, in the case of 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 a discussion of
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, 2011.

Conference Call

A conference call to discuss the firm’s results, outlook and related matters
will be held at 10:30 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
1-888-281-7154 (U.S. domestic) or 1-706-679-5627 (international). 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 web site,
www.gs.com/shareholders. 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 web site or by dialing 1-855-859-2056 (U.S. domestic) or 1-404-537-3406
(international) passcode number 75327207, beginning approximately two hours
after the event. Please direct any questions regarding obtaining access to the
conference call to Goldman Sachs Investor Relations, via e-mail, at
gs-investor-relations@gs.com.

                THE GOLDMAN SACHS GROUP, INC. AND SUBSIDIARIES
                             SEGMENT NET REVENUES
                                 (UNAUDITED)
                                $ in millions

                         Year Ended                            % Change From
                         December 31,       December 31,       December 31,
                         2012               2011               2011
Investment Banking
Financial Advisory       $  1,975           $  1,987           (1       )    %
                                                                              
Equity underwriting         987                1,085           (9       )
Debt underwriting           1,964              1,283           53        
Total Underwriting          2,951              2,368           25
                                                                         
Total Investment            4,926              4,355           13        
Banking
                                                                              
Institutional Client
Services
Fixed Income, Currency
and
                            9,914              9,018           10
Commodities Client
Execution
                                                                              
Equities client             3,171              3,031           5
execution ^(13)
Commissions and fees        3,053              3,633           (16      )
Securities services         1,986              1,598           24        
Total Equities              8,210              8,262           (1       )
                                                                         
Total Institutional         18,124             17,280          5         
Client Services
                                                                              
Investing & Lending
ICBC                        408                (517    )       N.M.
Equity securities           2,392              1,120           114
(excluding ICBC)
Debt securities and         1,850              96              N.M.
loans
Other                       1,241              1,443           (14      )
                                                                         
Total Investing &           5,891              2,142           175       
Lending
                                                                              
Investment Management
Management and other        4,105              4,188           (2       )
fees
Incentive fees              701                323             117
Transaction revenues        416                523             (20      )
                                                                         
Total Investment            5,222              5,034           4         
Management
                                                                         
Total net revenues       $  34,163          $  28,811          19        
                                                                              

                THE GOLDMAN SACHS GROUP, INC. AND SUBSIDIARIES
                             SEGMENT NET REVENUES
                                 (UNAUDITED)
                                $ in millions

                  Three Months Ended                              % Change From
                  December        September       December        September     December
                  31,             30,             31,             30,           31,
                  2012            2012            2011            2012          2011
Investment
Banking
Financial         $ 508           $ 509           $ 470           -         %   8        %
Advisory
                                                                                          
Equity              304             189             191           61            59
underwriting
Debt                593             466             196           27            N.M.   
underwriting
Total               897             655             387           37            132
Underwriting
                                                                                       
Total
Investment          1,405           1,164           857           21            64     
Banking
                                                                                          
Institutional
Client Services
Fixed Income,
Currency and
                    2,038           2,224           1,363         (8     )      50
Commodities
Client
Execution
                                                                                          
Equities client     764             847             526           (10    )      45
execution ^(13)
Commissions and     722             721             782           -             (8    )
fees
Securities          818             392             385           109           112    
services
Total Equities      2,304           1,960           1,693         18            36
                                                                                       
Total
Institutional       4,342           4,184           3,056         4             42     
Client Services
                                                                                          
Investing &
Lending
ICBC                334             99              388           N.M.          (14   )
Equity
securities          789             824             384           (4     )      105
(excluding
ICBC)
Debt securities     485             558             (221  )       (13    )      N.M.
and loans
Other               365             323             321           13            14
                                                                                       
Total Investing     1,973           1,804           872           9             126    
& Lending
                                                                                          
Investment
Management
Management and      1,067           1,016           1,016         5             5
other fees
Incentive fees      344             82              141           N.M.          144
Transaction         105             101             107           4             (2    )
revenues
                                                                                       
Total
Investment          1,516           1,199           1,264         26            20     
Management
                                                                                       
Total net         $ 9,236         $ 8,351         $ 6,049         11            53     
revenues
                                                                                          

                THE GOLDMAN SACHS GROUP, INC. AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF EARNINGS
                                 (UNAUDITED)
                    In millions, except per share amounts

                            Year Ended                              % Change
                                                                    From
                            December 31,         December 31,       December
                                                                    31,
                            2012                 2011               2011
Revenues
Investment banking          $  4,941             $  4,361           13       %
Investment                     4,968                4,691           6
management
Commissions and                3,161                3,773           (16   )
fees
Market making                  11,348    ^(14)      9,287           22
Other principal                5,865                1,507           N.M.   
transactions
Total non-interest             30,283               23,619          28
revenues
                                                                              
Interest income                11,381               13,174          (14   )
Interest expense               7,501                7,982           (6    )
Net interest income            3,880                5,192           (25   )
                                                                              
Net revenues,
including net                  34,163               28,811          19     
interest income
                                                                              
Operating expenses
Compensation and               12,944               12,223          6
benefits
                                                                              
Brokerage,
clearing, exchange             2,208                2,463           (10   )
and distribution
fees
Market development             509                  640             (20   )
Communications and             782                  828             (6    )
technology
Depreciation and               1,738                1,865           (7    )
amortization
Occupancy                      875                  1,030           (15   )
Professional fees              867                  992             (13   )
Insurance reserves             598                  529             13
Other expenses                 2,435                2,072           18     
Total
non-compensation               10,012               10,419          (4    )
expenses
                                                                           
Total operating                22,956               22,642          1      
expenses
                                                                              
Pre-tax earnings               11,207               6,169           82
Provision for taxes            3,732                1,727           116    
Net earnings                   7,475                4,442           68
                                                                              
Preferred stock                183                  1,932           (91   )
dividends
Net earnings
applicable to               $  7,292             $  2,510           191    
common shareholders
                                                                              
                                                                              
Earnings per common
share
Basic ^(15)                 $  14.63             $  4.71            N.M.     %
Diluted                        14.13                4.51            N.M.
                                                                              
Average common
shares outstanding
Basic                          496.2                524.6           (5    )
Diluted                        516.1                556.9           (7    )
                                                                              

                THE GOLDMAN SACHS GROUP, INC. AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF EARNINGS
                                 (UNAUDITED)
            In millions, except per share amounts and total staff

                   Three Months Ended                                 % Change From
                   December         September        December         September     December
                   31,              30,              31,              30,           31,
                   2012             2012             2011             2012          2011
Revenues
Investment         $ 1,407          $ 1,168          $ 863            20        %   63       %
banking
Investment           1,450            1,147            1,196          26            21
management
Commissions and      754              748              804            1             (6    )
fees
Market making        2,696    ^(14)   2,650            1,289          2             109
Other principal      1,956            1,802            832            9             135    
transactions
Total
non-interest         8,263            7,515            4,984          10            66
revenues
                                                                                              
Interest income      2,864            2,629            3,032          9             (6    )
Interest expense     1,891            1,793            1,967          5             (4    )
Net interest         973              836              1,065          16            (9    )
income
                                                                                              
Net revenues,
including net        9,236            8,351            6,049          11            53     
interest income
                                                                                              
Operating
expenses
Compensation and     1,976            3,675            2,208          (46   )       (11   )
benefits
                                                                                              
Brokerage,
clearing,
exchange and         550              547              560            1             (2    )
distribution
fees
Market               140              123              138            14            1
development
Communications       194              190              211            2             (8    )
and technology
Depreciation and     500              396              514            26            (3    )
amortization
Occupancy            232              217              249            7             (7    )
Professional         215              205              243            5             (12   )
fees
Insurance            167              153              127            9             31
reserves
Other expenses       949              547              552            73            72     
Total
non-compensation     2,947            2,378            2,594          24            14
expenses
                                                                                           
Total operating      4,923            6,053            4,802          (19   )       3      
expenses
                                                                                              
Pre-tax earnings     4,313            2,298            1,247          88            N.M.
Provision for        1,421            786              234            81            N.M.   
taxes
Net earnings         2,892            1,512            1,013          91            185
                                                                                              
Preferred stock      59               54               35             9             69     
dividends
Net earnings
applicable to      $ 2,833          $ 1,458          $ 978            94            190    
common
shareholders
                                                                                              
                                                                                              
Earnings per
common share
Basic ^(15)        $ 5.87           $ 2.95           $ 1.91           99        %   N.M.     %
Diluted              5.60             2.85             1.84           96            N.M.
                                                                                              
Average common
shares
outstanding
Basic                481.5            491.2            508.0          (2    )       (5    )
Diluted              505.6            510.9            531.8          (1    )       (5    )
                                                                                              
Selected Data
Total staff at       32,400           32,600           33,300         (1    )       (3    )
period-end ^(11)
                                                                                              

                THE GOLDMAN SACHS GROUP, INC. AND SUBSIDIARIES
                           SELECTED FINANCIAL DATA
                                 (UNAUDITED)

Average Daily VaR ^(16)
$ in millions
                                                                   
                      Three Months Ended                            Year Ended
                      December       September       December       December        December
                      31,            30,             31,            31,             31,
                      2012           2012            2011           2012            2011
Risk Categories
Interest rates        $  67          $  73           $  123         $   78          $  94
Equity prices            31             21              23              26             33
Currency rates           11             12              21              14             20
Commodity                20             22              26              22             32
prices
Diversification          (53 )          (47  )          (58 )           (54 )          (66 )
effect ^(16)
Total                 $  76          $  81           $  135         $   86          $  113  
                                                                                              
                                                                                              
Assets Under Supervision ^ (9)
$ in billions
                                                                                              
                      As of                                         % Change From
                      December       September       December       September       December
                      31,            30,             31,            30,             31,
                      2012           2012            2011           2012            2011
Asset Class
Alternative           $  133         $  136          $  142             (2  ) %        (6  ) %
investments
Equity                   133            135             126             (1  )          6
Fixed income             370            378             340             (2  )          9    
Total non-money          636            649             608             (2  )          5
market assets
                                                                                              
Money markets            218            207             220             5              (1  )
Total assets
under
                         854            856             828             -              3
management
(AUM)
                                                                                              
Other client             111            95              67              17             66   
assets
Total assets
under
                      $  965         $  951          $  895             1              8    
supervision
(AUS)
                                                                                              
                                                                                              
                      Three Months Ended                            Year Ended
                      December       September       December       December        December
                      31,            30,             31,            31,             31,
                      2012           2012            2011           2012            2011
                                                                                              
Balance,
beginning of          $  951         $  916          $  889         $   895         $  917
period
                                                                                              
Net inflows /
(outflows)
Alternative              (3  )          (3   )          (2  )           (11 )          (5  )
investments
Equity                   (5  )          (1   )          (7  )           (13 )          (9  )
Fixed income             (10 )          5               (12 )           8              (15 )
Total non-money
market net               (18 )          1               (21 )           (16 )          (29 )
inflows /
(outflows)
                                                                                              
Money markets            11             (2   )          13              (2  )          12   
Total AUM net
inflows /                (7  )          (1   )          (8  )           (18 )          (17 ) ^(17)
(outflows)
                                                                                              
Other client             15             14              (3  )           39             (10 )
assets
Total AUS net
inflows /                8     ^(10)    13              (11 )           21    ^(10)    (27 )
(outflows)
                                                                                              
Net market
appreciation /           6              22              17              49             5
(depreciation)
                                                                                     
Balance, end of       $  965         $  951          $  895         $   965         $  895  
period
                                                                                              

                                  Footnotes

    ROE is computed by dividing net earnings (or annualized net earnings for
(1) annualized ROE) applicable to common shareholders by average monthly
    common shareholders’ equity. The table below presents the firm’s average
    common shareholders’ equity:
     

                                                                              Average for the                    
                                                                                                     Three
                                                                                Year Ended           Months
                                                                                                     Ended
        Unaudited, in                                                             December             December  
        millions                                                                31, 2012             31, 2012  
        Total
        shareholders'                                                         $ 72,530             $ 74,767
        equity
        Preferred                                                               (4,392  )            (5,988     )
        stock
        Common
        shareholders’                                                         $ 68,138             $ 68,779      
        equity
                                                                                                                 

(2)   Thomson Reuters – January 1, 2012 through December 31, 2012.
       
      Tangible common shareholders' equity equals total shareholders' equity
      less preferred stock, goodwill and identifiable intangible assets.
      Tangible book value per common share is computed by dividing tangible
      common shareholders’ equity by the number of common shares outstanding,
      including restricted stock units granted to employees with no future
      service requirements. Management believes that tangible common
(3)   shareholders’ equity and tangible book value per common share are
      meaningful because they are measures that the firm and investors use to
      assess capital adequacy. Tangible common shareholders’ equity and
      tangible book value per common share are non-GAAP measures and may not
      be comparable to similar non-GAAP measures used by other companies. The
      table below presents the reconciliation of total shareholders' equity to
      tangible common shareholders' equity:
       

                                                                                                                    As of
        Unaudited, in                                                                                                   December
        millions                                                                                                      31, 2012  
        Total
        shareholders'                                                                                               $ 75,716
        equity
        Preferred                                                                                                     (6,200  )
        stock
        Common
        shareholders’                                                                                                 69,516
        equity
        Goodwill and
        identifiable                                                                                                  (5,099  )
        intangible
        assets
        Tangible
        common                                                                                                      $ 64,417   
        shareholders’
        equity
                                                                                                                       

       The firm’s global core excess represents a pool of excess liquidity
       consisting of unencumbered, highly liquid securities and cash. For a
       further discussion of the firm's global core excess liquidity pool, see
(4)    “Liquidity Risk Management” 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
       September 30, 2012.
        
       Represents a preliminary estimate as of the date of this earnings
(5)    release and may be revised in the firm’s Annual Report on Form 10-K for
       the year ended December 31, 2012.
        
       The Tier 1 capital ratio equals Tier 1 capital divided by risk-weighted
       assets. The firm’s risk-weighted assets under the Board of Governors of
       the Federal Reserve System’s risk-based capital requirements (Basel 1)
(6)    were approximately $400 billion as of December 31, 2012. For a further
       discussion of the firm's capital ratios, see “Equity Capital” 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 September 30, 2012.
        
       The Tier 1 common ratio equals Tier 1 common capital divided by
       risk-weighted assets. As of December 31, 2012, Tier 1 common capital
       was $58.05 billion, consisting of Tier 1 capital of $66.98 billion less
       preferred stock of $6.20 billion and junior subordinated debt issued to
       trusts of $2.73 billion. Management believes that the Tier 1 common
       ratio is meaningful because it is one of the measures that the firm and
(7)    investors use to assess capital adequacy. The Tier 1 common ratio is a
       non-GAAP measure and may not be comparable to similar non-GAAP measures
       used by other companies. For a further discussion of the firm's capital
       ratios, see “Equity Capital” 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
       September 30, 2012.
        
       The firm’s investment banking transaction backlog represents an
(8)    estimate of the firm’s future net revenues from investment banking
       transactions where management believes that future revenue realization
       is more likely than not.
        
       Assets under supervision include assets under management and other
       client assets. Assets under management include client assets where the
(9)    firm earns a fee for managing assets on a discretionary basis. Other
       client assets include client assets invested with third party managers,
       private bank deposits and assets related to advisory relationships
       where the firm earns a fee for advisory and other services.
        
       Includes $34 billion of fixed income asset inflows in connection with
       the firm’s acquisition of Dwight Asset Management Company LLC,
       including $17 billion in assets under management and $17 billion in
       other client assets, for the year ended December 31, 2012. Includes
(10)   $5 billion of fixed income and equity asset outflows in connection with
       the firm’s liquidation of Goldman Sachs Asset Management Korea Co.,
       Ltd. (formerly known as Macquarie – IMM Investment Management), all
       related to assets under management, for both the three months and the
       year ended December 31, 2012.
        
(11)   Includes employees, consultants and temporary staff.
        
       The remaining share authorization represents the shares that may be
       repurchased under the repurchase program approved by the Board of
       Directors. As disclosed in “Note 19. Shareholders’ Equity” in Part I,
(12)   Item 1 “Financial Statements” in the firm's Quarterly Report on
       Form 10-Q for the period ended September 30, 2012, share repurchases
       require approval by the Board of Governors of the Federal Reserve
       System.
        
       Includes net revenues related to reinsurance of $1.08 billion and
       $880 million for the years ended December 31, 2012 and
(13)   December 31, 2011, respectively, and $317 million, $297 million and
       $158 million for the three months ended December 31, 2012,
       September 30, 2012 and December 31, 2011, respectively.
        
(14)   Includes a gain of approximately $500 million on the sale of the firm’s
       hedge fund administration business.
        
       Unvested share-based payment awards that have non-forfeitable rights to
       dividends or dividend equivalents are treated as a separate class of
       securities in calculating earnings per common share. The impact of
(15)   applying this methodology was a reduction in basic earnings per common
       share of $0.07 for both the years ended December 31, 2012 and
       December 31, 2011, $0.01 for the three months ended December 31, 2012
       and $0.02 for both the three months ended September 30, 2012 and
       December 31, 2011.
        
       VaR is the potential loss in value of the firm’s inventory positions
       due to adverse market movements over a one-day time horizon with a 95%
       confidence level. Diversification effect equals the difference between
       total VaR and the sum of the VaRs for the four risk categories. For a
(16)   further discussion of VaR and the diversification effect, see “Market
       Risk Management” 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
       September 30, 2012.
        
       Includes $6 billion of asset inflows across all asset classes in
(17)   connection with the firm’s acquisitions of Goldman Sachs Australia Pty
       Ltd and Benchmark Asset Management Company Private Limited.

Contact:

The Goldman Sachs Group, Inc.
Media Relations:
Jake Siewert, 212-902-5400

Investor Relations:
Dane E. Holmes, 212-902-0300
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