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Goldman Sachs: A Giant in Investment Banking

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Sep. 21 2015, Published 7:05 a.m. ET

Company overview

Goldman Sachs (GS) is a global investment bank, as well as a securities and investment management firm. The company provides advisory, wealth management, and various other financial services to corporations, banks, high-net-worth individuals, and governments across the globe.

Goldman Sachs classifies its income under four segments:

  • Investment Banking: advises corporates on fundraising, mergers and acquisitions, divestitures, corporate defense activities, restructurings, spin-offs, and risk management
  • Institutional Client Services: facilitates transactions for clients in equity, fixed income, currency, and commodity products
  • Investing and Lending: investments into public and private equity securities, debt securities and loans, and real estate
  • Investment Management: provides investment and wealth advisory services

Goldman Sachs also operates the US depository institution subsidiary Goldman Sachs Bank USA. As of December 2014, the company had offices in over 30 countries with 34,000 employees around the world.

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Expanding operations

Goldman Sachs reported total revenues of $40.1 billion in fiscal 2014 with net income of $8.5 billion. The company has almost doubled its net profits over the past three years on strong advisory, trading, and wealth management business. Goldman Sachs competes with asset management firms, financial advisors, diversified financial services firms, commercial banks, wealth management firms, and investment banks within and outside of the US.

The company’s assets under management stood at $757 billion of client assets as of June 30, 2015. Its major competitors with their respective earnings include:

  • Morgan Stanley (MS): $37.95 billion
  • JPMorgan Chase (JPM): $51.5 billion
  • Bank of America (BAC): $50.9 billion
  • Wells Fargo (WFC): $47.6 billion

Together, these banks account for ~28.8% of the Financial Select Sector SPDR ETF (XLF).

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