Tuesday, July 20, 2010

Goldman Sachs reports lower 2Q earnings

NEW YORK:- Goldman Sachs Group Inc posted lower second-quarter earnings on Tuesday, July 20, hurt by its settlement of U.S. Securities and Exchange Commission fraud charges and the UK tax on bank executive bonuses.

Goldman, which resolved a major headache last week by paying $550 million to settle the SEC case, said earnings applicable to common shareholders fell to $453 million, or 78 cents a share.

A year earlier, the bank reported earnings to common shareholders of $2.7 billion, or $4.93 a share.

Weakness in its trading and investment banking divisions also weighed on earnings.

The fraud charges stemmed from Goldman's marketing and packaging of the Abacus collateralized debt obligation. The bank agreed to settle the case last Thursday.

Goldman said earnings were impacted by a $600 million expense related to the UK tax.

Goldman shares were down 2.1 percent to $142.55 in premarket trade. U.S. stock index futures extended declines after the Goldman results. - Reuters

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