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Goldman Sachs Reports Q3 Results

Equities generated quarterly net revenues of $2.78 billion, reflecting strong results across the franchise

The Goldman Sachs has reported net revenues of $12.37 billion and net earnings of $3.19 billion for its third quarter ended September 25, 2009. Fixed income, currency and commodities generated quarterly net revenues of $5.99 billion, reflecting strong results across most businesses. Equities generated quarterly net revenues of $2.78 billion, reflecting strong results across the franchise. Net revenues in investment banking were $899 million, 31% lower than the third quarter of 2008 and 38% lower than the second quarter of 2009.

The firm’s Tier 1 capital ratio under Basel I was 14.5% as of September 25, 2009, up from 13.8% as of June 26, 2009. The firm’s Tier 1 common ratio under Basel I was 11.6% as of September 25, 2009, up from 10.9% as of June 26, 2009. Reportedly, on July 22, 2009, the firm repurchased the warrant issued to the US Treasury pursuant to the Treasury’s TARP Capital Purchase Program for $1.1 billion. The US taxpayers’ annualized return on their total investment in the firm was approximately 23%.

As of September 25, 2009, total capital was $255.07 billion, consisting of $65.35 billion in total shareholders’ equity (common shareholders’ equity of $58.40 billion and preferred stock of $6.96 billion) and $189.72 billion in unsecured long-term borrowings. Book value per common share was $110.75 and tangible book value per common share was $101.39, an increase of 4% and 5%, respectively, during the quarter.

Lloyd Blankfein, chairman and CEO, said: “Although the world continues to face serious economic challenges, we are seeing improving conditions and evidence of stabilization, even growth, across a number of sectors. Our client franchise businesses — advisory, financing, market making and asset management — contribute to and benefit from the overall improvement in conditions. Because the job market, and growth more generally, remain under stress, we continue to be focused on actively helping our clients in order to promote greater economic activity.”