Reuters - Goldman Sachs Group Inc reported an 86% surge in third quarter earnings that swept past expectations on Friday, as Wall Street's biggest investment bank rode a record wave of M&A activity that has boosted profit at other large U.S. banks too.
Net earnings applicable to common shareholders rose to $5.28 billion from $3.23 billion a year earlier in the quarter ended 30 Sept - 30, 2018.
Earnings per share rose to $14.93 from $8.98 a year earlier. Analysts forecast a profit of $10.11 per share, according to the IBES estimate from Refinitiv on average.
Goldman, which generates a majority of its revenue by raking in lucrative fees from advising on the world's biggest deals, reported a surge in advisory fees as large companies and financial sponsors embarked on a slew of transformative deals this year.
The total revenue increase 26% to $14.21 billion. Investment banking revenues almost doubled to $3.55 billion.
Global M&A volumes have shattered all-time records. The pace of dealmaking has surpassed all expectations, with advisors struggling to cope with transaction volumes never seen before.
According to Refinitiv data, nearly $1.5 trillion was signed by the world's biggest investment banks in the September quarter of 2008.
Refinitiv comfortably latched onto the top ranking in the US league tables for M&A advisory according to Goldman. The league tables rank financial institutions on the amount of m&a profits they generate.