Amid controversy, Goldman Sachs Group Inc. reported Tuesday its first quarter earnings nearly doubled from a year earlier.
Boosted by higher trading, the New York-based company reported that profits increased 91% from a year earlier to $3.46 billion, or $5.59 per share.
The good news couldn’t have come at a better time for Goldman [GS], which saw its stock – and reputation – tumble last week after the Securities and Exchange Commission filed a complain against the Wall Street giant alleging civil fraud.
The SEC sued Goldman for securities fraud, alleging it made “materially misleading statements and omissions” regarding a structured product sold to investors. The product was tied to the performance of subprime residential mortgages and was structured and marketed in early 2007, just when the U.S. housing market first showed signs of strain, the suit said.
The company’s stock declined 13% Friday after the charges were filed, but rose in early trading Tuesday after announcing its quarterly results.
Lloyd C. Blankfein, Goldman’s top executive, said in a press release that “in light of recent events involving the firm, we appreciate the support of our clients and shareholders, and the dedication and commitment of our people.”
In the first quarter, Goldman’s results surged because of stronger trading and bond underwriting. Overall revenue increased 36% to $12.8 billion.
The surge in profits were not a surprised to analysts, who expected earnings of 4.01 on $11.07 billion in revenue.
Total trading and principal investments increased 61% to $9.2 billion. Fixed income, currency and commodities revenue rose 13%. Investment-banking revenue increased 44%.