On the earnings call, Goldman’s Chief Financial Officer Martin Chavez said the year on year increases were the result of “a lot of drivers,” not just volatility.
“The environment lined up well for our franchise,” Chavez said, adding that performance was strong across across geographies and product lines. “Bottom line, the franchise does well when clients are active.“
Chavez also said Marcus, the firm’s consumer lending platform, originated $3 billion in consumer loans and had $20 billion in retail deposits as of the end of March. On Monday, Goldman announced the acquisition of lending app Clarity Money, which is expected to add more than 1 million customers to the Marcus business.
“You can expect to continue to see us invest in adjacent business that will add to that digital app and digital experiences,” Chavez said.
The firm is bullish on global mergers and acquisitions going forward, Chavez said, despite building tensions between the U.S. and China.
“Yes there are concerns about tariffs, trade wars and so on, but the activity and dialogue is strong,” Chavez said.
Last quarter, Goldman reported earnings that topped Wall Street estimates but the bank posted a net loss when factoring in a tax hit, largely because of a one-time charge for bringing overseas profits back to the U.S. Investors were also unhappy with the poor trading results.
David Solomon is next in line to succeed Blankfein after the firm announced Harvey Schwartz, who shares the titles of co-president and co-chief operating officer, is leaving the bank April 20. A report from The Wall Street Journal that Blankfein was likely to step down as soon as this year had accelerated discussions about who would take over.
Blankfein has not said exactly when he will step down, and there has been speculation that he could hold off until 2019, and stay on as chairman even after departing as CEO.
Goldman is looking to transition out of its core trading business into more profitable lines. Its investment banking arm, for example, notched $2.14 billion in net revenues last quarter and $7.37 billion for the year, its second best ever. Mergers and acquisitions continue to be a mainstay for the firm.
Goldman follows other major U.S. banks’ reporting earnings this week. Bank of America reported better-than-expected results on Monday, while J.P. Morgan, Wells Fargo and Citigroup all beat analysts’ earnings per share expectations on Friday.
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