Financial Summary

Net Revenues

Net Earnings

EPS

1Q23                   $12.22 billion  

1Q23                     $3.23 billion  

1Q23                                 $8.79  

Annualized ROE¹

Annualized  ROTE¹

Book Value Per Share

1Q23                                11.6%  

1Q23                                12.6%  

1Q23                            $310.48  

During the quarter, the firm supported clients and continued to execute on strategic priorities, which contributed to solid quarterly net revenues of $12.22 billion and diluted EPS of $8.79.

Global Banking & Markets generated quarterly net revenues of $8.44 billion, driven by strong performances in Fixed Income, Currency and Commodities (FICC) and Equities, including record quarterly net revenues in Equities financing.

The firm ranked #1 in worldwide completed mergers and acquisitions for the year-to-date.²

Asset & Wealth Management generated quarterly net revenues of $3.22 billion, including record Management and other fees.

Assets under supervision^3,4 increased $125 billion during the quarter to a record $2.67 trillion.

Platform Solutions generated quarterly net revenues of $564 million, more than double the amount in the prior year period.

Book value per common share increased by 2.3% during the quarter to $310.48.

Net revenues were $12.22 billion for the first quarter of 2023, 5% lower than the first quarter of 2022 and 15% higher than the fourth quarter of 2022. The decrease compared with the first quarter of 2022 reflected lower net revenues in Global Banking & Markets, partially offset by significantly higher net revenues in Asset & Wealth Management and Platform Solutions.

Net Revenues

$12.22 billion

Net revenues in Global Banking & Markets were $8.44 billion for the first quarter of 2023, 16% lower than a strong first quarter of 2022 and 30% higher than the fourth quarter of 2022.

Investment banking fees were $1.58 billion, 26% lower than the first quarter of 2022, primarily due to significantly lower net revenues in Advisory, reflecting a significant decline in industry-wide completed mergers and acquisitions transactions, and Debt underwriting, reflecting a decline in industry-wide volumes. The firm’s Investment banking fees backlog³ decreased compared with the end of 2022.

Net revenues in FICC were $3.93 billion, 17% lower than the first quarter of 2022, reflecting significantly lower net revenues in FICC intermediation, driven by significantly lower net revenues in currencies and commodities, partially offset by significantly higher net revenues in interest rate products and higher net revenues in mortgages and credit products. Net revenues in FICC financing were slightly higher.

Net revenues in Equities were $3.02 billion, 7% lower than the first quarter of 2022, due to significantly lower net revenues in Equities intermediation across both derivatives and cash products. Net revenues in Equities financing were significantly higher, primarily reflecting increased spreads.

Net revenues in Other were $(81) million, compared with $(51) million for the first quarter of 2022.

Global Banking & Markets

$8.44 billion

Advisory

$ 818 million 

Equity underwriting

$ 255 million 

Debt underwriting

$ 506 million 

Investment banking fees

$ 1.58 billion 

FICC intermediation

$ 3.28 billion 

FICC financing

$ 651 million 

FICC

$ 3.93 billion 

Equities intermediation

$ 1.74 billion 

Equities financing

$ 1.27 billion 

Equities

$ 3.02 billion 

Other

$ (81) million 

Net revenues in Asset & Wealth Management were $3.22 billion for the first quarter of 2023, 24% higher than the first quarter of 2022 and 10% lower than the fourth quarter of 2022. The increase compared with the first quarter of 2022 reflected net gains in Equity investments compared with net losses in the prior year period, higher Management and other fees and higher net revenues in Debt investments. Net revenues in Private banking and lending included a loss of approximately $470 million related to a partial sale of the Marcus loans portfolio and the transfer of the remainder of the portfolio to held for sale (largely offset by a related reserve reduction of approximately $440 million in provision for credit losses).

The increase in Equity investments net revenues reflected mark-to-market net gains from investments in public equities compared with significant mark-to-market net losses in the prior year period, partially offset by significantly lower net gains from investments in private equities. The increase in Management and other fees primarily reflected the inclusion of NN Investment Partners (NNIP) and a reduction in fee waivers on money market funds. The increase in Debt investments net revenues reflected net mark-ups compared with net mark-downs in the prior year period. Net revenues in Private banking and lending were significantly lower, due to the loss related to the Marcus loans portfolio, partially offset by the impact of higher deposit spreads. Incentive fees were also lower.

    Asset & Wealth Management    

$3.22 billion

Management and   other fees

$  2.28 billion 

Incentive fees

$    53 million 

Private banking and   lending

$  354 million 

Equity investments

$   119 million 

Debt investments

$  408 million 

Net revenues in Platform Solutions were $564 million for the first quarter of 2023, 110% higher than the first quarter of 2022 and 10% higher than the fourth quarter of 2022. The increase compared with the first quarter of 2022 reflected significantly higher net revenues in Consumer platforms.

The increase in Consumer platforms net revenues primarily reflected significantly higher average credit card balances. Transaction banking and other net revenues were also higher, reflecting higher average deposit balances.

Platform Solutions

$564 million

Consumer platforms

Transaction banking

  and other

$   74 million  

Provision for credit losses was a net benefit of $171 million for the first quarter of 2023, compared with net provisions of $561 million for the first quarter of 2022 and $972 million for the fourth quarter of 2022. The net benefit for the first quarter of 2023 reflected a reserve reduction of approximately $440 million related to a partial sale of the Marcus loans portfolio and the transfer of the remainder of the portfolio to held for sale, partially offset by net provisions related to the credit card and point-of-sale loan portfolios, reflecting net charge-offs and growth, and a provision related to a term deposit. Provisions for the first quarter of 2022 primarily reflected growth in the credit card portfolio, the impact of macroeconomic and geopolitical concerns, and individual impairments on wholesale loans.

      Provision for Credit Losses      

$(171) million

Operating expenses were $8.40 billion for the first quarter of 2023, 9% higher than the first quarter of 2022 and 4% higher than the fourth quarter of 2022. The firm’s efficiency ratio³ for the first quarter of 2023 was 68.7%, compared with 59.7% for the first quarter of 2022.

The increase in operating expenses compared with the first quarter of 2022 was due to impairments of approximately $355 million related to consolidated real estate investments (in depreciation and amortization), the inclusion of NNIP and higher technology and transaction based expenses.

Net provisions for litigation and regulatory proceedings for the first quarter of 2023 were $72 million compared with $125 million for the first quarter of 2022.

Headcount decreased 6% compared with the end of 2022, primarily reflecting a headcount reduction initiative during the quarter.

          Operating Expenses              

$8.40 billion

                Efficiency Ratio                 

68.7%

The effective income tax rate for the first quarter of 2023 was 19.0%, up from the full year rate of 16.5% for 2022, primarily due to the impact of an increase in taxes on non-U.S. earnings and decreases in permanent tax benefits, partially offset by the impact of tax benefits on the settlement of employee share-based awards for the first quarter of 2023 compared with the full year of 2022.

              Effective Tax Rate               

19.0%

◾ On April 14, 2023, the Board of Directors of The Goldman Sachs Group, Inc. declared a dividend of $2.50 per common share to be paid on June 29, 2023 to common shareholders of record on June 1, 2023.

◾ During the quarter, the firm returned $3.41 billion of capital to common shareholders, including $2.55 billion of common share repurchases (7.1 million shares at an average cost of $359.77) and $868 million of common stock dividends.³

◾ Global core liquid assets³ averaged $399 billion⁴ for the first quarter of 2023, compared with an average of $409 billion for the fourth quarter of 2022.

Declared Quarterly

Dividend Per Common Share

$2.50

Common Share Repurchases

7.1 million shares

for $2.55 billion

Average GCLA

$399 billion

Footnotes

Annualized ROE is calculated by dividing annualized net earnings applicable to common shareholders by average monthly common shareholders’ equity. Annualized ROTE is calculated by dividing annualized net earnings applicable to common shareholders by average monthly tangible common shareholders’ equity (tangible common shareholders’ equity is calculated as total shareholders’ equity less preferred stock, goodwill and identifiable intangible assets). Management believes that ROTE is meaningful because it measures the performance of businesses consistently, whether they were acquired or developed internally, and that tangible common shareholders’ equity is meaningful because it is a measure that the firm and investors use to assess capital adequacy. ROTE and tangible common shareholders’ equity are non-GAAP measures and may not be comparable to similar non-GAAP measures used by other companies.

Dealogic – January 1, 2023 through March 31, 2023.

For information about the following items, see the referenced sections in Part II, Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the firm’s Annual Report on Form 10-K for the year ended December 31, 2022: (i) Investment banking fees backlog – see “Results of Operations – Global Banking & Markets” (ii) assets under supervision – see “Results of Operations – Asset & Wealth Management – Assets Under Supervision” (iii) efficiency ratio – see “Results of Operations – Operating Expenses” (iv) share repurchase program – see “Capital Management and Regulatory Capital – Capital Management” (v) global core liquid assets – see “Risk Management – Liquidity Risk Management” (vi) basic shares – see “Balance Sheet and Funding Sources – Balance Sheet Analysis and Metrics” and (vii) VaR – see “Risk Management – Market Risk Management.”

For information about the following items, including changes made to the firm’s segments and reclassifications made to previously reported amounts, see the referenced sections in Part II, Item 8 “Financial Statements and Supplementary Data” in the firm’s Annual Report on Form 10-K for the year ended December 31, 2022: (i) risk-based capital ratios and the supplementary leverage ratio – see Note 20 “Regulation and Capital Adequacy” (ii) geographic net revenues – see Note 25 “Business Segments” and (iii) unvested share-based awards that have non-forfeitable rights to dividends or dividend equivalents in calculating basic EPS – see Note 21 “Earnings Per Common Share.”

Represents a preliminary estimate for the first quarter of 2023 and may be revised in the firm’s Quarterly Report on Form 10-Q for the period ended March 31, 2023.

During the first quarter of 2023, the firm added the currency exposure on certain debt and equity positions to VaR and removed certain debt and equity positions (and related hedges) from VaR as management believes that the risk of these positions is more appropriately measured and monitored using 10% sensitivity measures. Prior period amounts for average daily VaR have been conformed to the current presentation. The impact of such changes was not material. See “Risk Management – Market Risk Management” in Part II, Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the firm’s Annual Report on Form 10-K for the year ended December 31, 2022 for further information about VaR and 10% sensitivity measures.