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Business

Goldman Sachs reports another steep drop in profits

Citing a "broad set of challenges," the financial giant has reported first-quarter earnings that are down over 50 percent from last year. But it's not the only big business to be thrashed by turbulent markets.

US financial giant Goldman Sachs reported a 56.3 percent drop in first-quarter profits, in comparison to its much

rosier start to 2015.

Earnings were $1.2 billion and revenues were $6.3 billion, down 40.3 percent from last year.

"The operating environment this quarter presented a broad range of challenges, resulting in headwinds across virtually every one of our businesses," said CEO Lloyd Blankfein.

This is Goldman's fourth straight quarter of drops in profit.

Justifying the low numbers, Goldman cited the weak markets for bonds, commodities, currency and stocks. It also saw a decrease in advising activity, as the volatile markets slowed the pace of mergers and acquisitions.

It sought to regain ground by underwriting more debt and slashing employee compensation and benefits by 40 percent.

Chief Financial Officer Harvey Schwartz was optimistic about a quick tournaround. "It really feels like many of the factors that were affecting the first quarter, particularly early on, have abated," he said on Tuesday.

Bleak numbers for big players

Goldman may be the US bank worst hit by

recent turmoil in financial markets,

but it is certainly not the only one affected.

Morgan Stanley profits fell 54 percent in the first-quarter. Citibank's first-quarter profits took a 27 percent hit.

These numbers are all a bad sign for the

already embattled Deutsche Bank.

Its operations are closely tied up with investment banking and financial markets.

Disheartening numbers also came from elsewhere on Wall Street. Netflix shares were rattled after the company warned of slow future growth, and prices for IT company IBM slid after the IT company reported its 16th straight quarter of lower revenues.

jm/hch (AFP, dpa, Reuters)

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