7:30 p.m. | Updated A colleague pointed out that we should use only days on which the market was open for our calculations. That means the Goldman fine amounts to about 10.2 days of earnings, based on its first-quarter results.
While Goldman Sachs’s $550 million settlement with the Securities and Exchange Commission may seem impressive at first glance, it’s a charge the firm can handle easily.
The S.E.C. described the penalty as the largest in the agency’s history from a Wall Street firm. But it’s not the largest ever paid by a Wall Street bank; that dubious distinction belongs to Drexel Burnham Lambert, which paid $650 million to settle criminal charges.
And one look at Goldman’s first-quarter earnings this year show how quickly the firm can make up for the fine and restitution.
The Goldman Fraud CaseDealBook’s full coverage of the Securities and Exchange Commission’s lawsuit against Goldman Sachs over a mortgage-related security.
The S.E.C.’s Lawsuit Goldman’s “Abacus” Marketing Materials Documents from the Senate’s Inquiry Into Goldman DealBook’s Documents in the Goldman InvestigationsGo to Full Coverage of the S.E.C.’s Goldman Case »
Goldman earned $3.84 billion in the quarter, atop a staggering $12.78 billion in revenues. By that measure, the fine amounts to nearly 15 days of earnings in the first three months of the year. (It’s about 14.3 days of earnings, to be more precise.)
Some other first-quarter numbers to put the Goldman fine in perspective:
$720 million in net revenue for debt and equity underwriting $7.4 billion in net revenue for fixed income, currencies and commodities trading $946 million in net revenue for asset managementStill, when Goldman announces its earnings next week, the firm is expected to announce that it will take a charge for the fine.
It’s a safe bet that it should not immediately and significantly impact any profit the firm will report.
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E-mail This Print Share Close Linkedin Digg Facebook Mixx My Space new_york_times:http://dealbook.blogs.nytimes.com/2010/07/15/goldmans-fine-14-days-of-earnings/ Permalink Financial Services, Legal, The Goldman Fraud Case, Top Headline, Goldman Sachs, Securities and Exchange Commission Related Posts From DealBook Goldman Says Settlement Is ‘the Right Outcome’It’s Over for Goldman, but Not for Fabrice TourreLive Coverage of S.E.C.’s Goldman PresserGoldman Settles With S.E.C. for $550 MillionGoldman Said to Propose ‘All-in-One’ Settlement Previous post Live Coverage of S.E.C.’s Goldman Presser Next post It’s Over for Goldman, but Not for Fabrice Tourre NYTD.CRNR.userContent.getUserContent(25,'default'); Latest DealBook Headlines Goldman Says Settlement Is ‘the Right Outcome’ // It’s Over for Goldman, but Not for Fabrice Tourre // Goldman’s Fine: 10.2 Market Days of Earnings // Live Coverage of S.E.C.’s Goldman Presser // Goldman Settles With S.E.C. for $550 Million // DealBook News by Industry Airlines / Autos Basic Industries Consumer Goods Energy / Utilities Financial Services Food & Beverage Healthcare Media Real Estate Retail / Leisure Technology Telecom Contributors Andrew Ross Sorkin Editor Posts | Profile Jack Lynch News Editor Posts Michael de la Merced Reporter Posts | Profile Cyrus Sanati Contributing Reporter Posts Steven M. Davidoff The Deal Professor Posts | E-mail Peter J. Henning White Collar Watch Posts Liza Klaussmann Overnight News Editor Posts Chris V. Nicholson European News Editor Posts Home World U.S. N.Y. / Region Business Technology Science Health Sports Opinion Arts Style Travel Jobs Real Estate Autos Back to Top Copyright 2010 The New York Times Company Privacy Terms of Service Search Corrections RSS First Look Help Contact Us Work for Us Advertise Site Map var gtrackevents=false; if (typeof NYTD.Blogs.user != 'undefined') { if(NYTD.Blogs.user.isLoggedIn()) { var dcsvid=NYTD.Blog7:30 p.m. | Updated A colleague pointed out that we should use only days on which the market was open for our calculations. That means the Goldman fine amounts to about 10.2 days of earnings, based on its first-quarter results.
While Goldman Sachs’s $550 million settlement with the Securities and Exchange Commission may seem impressive at first glance, it’s a charge the firm can handle easily.
The S.E.C. described the penalty as the largest in the agency’s history from a Wall Street firm. But it’s not the largest ever paid by a Wall Street bank; that dubious distinction belongs to Drexel Burnham Lambert, which paid $650 million to settle criminal charges.
And one look at Goldman’s first-quarter earnings this year show how quickly the firm can make up for the fine and restitution.
DealBook’s full coverage of the Securities and Exchange Commission’s lawsuit against Goldman Sachs over a mortgage-related security.
Go to Full Coverage of the S.E.C.’s Goldman Case »
Goldman earned $3.84 billion in the quarter, atop a staggering $12.78 billion in revenues. By that measure, the fine amounts to nearly 15 days of earnings in the first three months of the year. (It’s about 14.3 days of earnings, to be more precise.)
Some other first-quarter numbers to put the Goldman fine in perspective:
Still, when Goldman announces its earnings next week, the firm is expected to announce that it will take a charge for the fine.
It’s a safe bet that it should not immediately and significantly impact any profit the firm will report.
Go to Previous Item from DealBook » Go to DealBook’s Coverage of the S.E.C.’s Goldman Case »
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