Goldman Sachs Group posted revenue for the fourth quarter that beat estimates of analysts as its fee from merger consulting jumped by 27%. Net income fell over 65% on the costs of settling a probe into mortgages.
Revenue was down by 5% to end the quarter at $7.27 billion, which was higher than analyst estimates of $7.17 billion. Net income was down, ending the quarter at $765 million equal to $1.27 per share, compared to over $2.17 billion equal to $4.38 per share, after the company agreed to settle a probe by U.S. authorities into the handling by the bank of securities that were mortgage-back, lowered earnings by more than $1.54 billion.
The merger business at Goldman Sachs benefitted from more than $3.8 trillion in global deals during 2015, surpassing a record set previously in 2007, prior to the crisis.
The company said a week ago that it reached an agreement of $5.1 billion on its mortgage cases, cutting its profit from the fourth quarter and closing out the year of record litigation and legal costs.
Goldman Sachs stock was down by 1.4% early Wednesday morning before the opening bell on Wall Street. Stock at the firm has fallen 13% in 2016 trailing the 10% decline by the financials index of the S&P 500.
Revenue from investment banking was up 7% to just over $1.55 billion, with revenue from advising mergers climbing from just over $692 million and $879 million.
For the entire year of 2015, the merger advisory fees increased by 40% to just over $3.47 billion, which were the highest at the firm since 2007.
Revenue from fixed income, commodities and currency trading was up 1.2% to end the quarter at $1.18 billion excluding adjustments for accounting.
That compares to analyst estimates of $1.19 billion. Revenue from equity trading was at $1.77 billion, which was down 7.1% from the same time one year ago, beating an estimate by analysts of $1.68 billion.