Goldman Sachs’s strategy to refocus on its core Wall Street operations continues to pay off.
Goldman’s second-quarter revenue increased 17% from a year ago to $12.73 billion, led by its asset and wealth management business, where it manages investments for large institutional clients and wealthy individuals, and an increase in investment banking fees.
Goldman’s overall profit increased 150% from a year ago, when the bank was in the middle of a pullback from consumer lending, to $3.04 billion.
Goldman has been undergoing a strategy shift, exiting consumer-lending after incurring billions of dollars in losses. The bank is instead refocusing on its core businesses of dealmaking and trading while growing its asset and wealth management division.
Investment banking revenue was $1.73 billion, up 21% from a year ago, led by big increases in debt and equity underwriting revenue. Still, it was down from Goldman’s first quarter this year and the rise was less than that of JPMorgan Chase, which reported Friday its investment banking revenue jumped nearly 50%.
Revenue in asset and wealth management, a key division Goldman is relying on to diversify its revenue stream, increased 27% to $3.88 billion. Trading revenue of $6.35 billion rose 12%, helped by lending to institutional clients. Goldman has been pushing into this type of lending to produce more predictable revenue streams.