US banking giant beats first-quarter profit predictions

Banking giant Goldman Sachs beat Wall Street’s earnings expectations as it reported a profit of $1.66bn (€1.25bn) for the first three months of this year.

The news is another sign that banks may be turning around.

Goldman Sachs also said it planned to raise $5bn (€3.75bn) in stock to help it pay back US government bailout funds.

The New York-based bank said it earned $3.39 (€2.55) per share, easily surpassing analysts’ forecasts for profit of $1.64 (€1.23) per share.

This compares with earnings of $1.47bn (€1.1bn), or $3.23 (€2.42) per share, in the quarter that ended on February 29 of last year, and is a huge improvement over the $2.29bn (€1.72bn) Goldman lost in the fourth quarter.

Goldman received $10bn (€7.51bn) in government funds during the downturn last autumn as part of the US Treasury Department’s programme to invest directly in hundreds of banks and try and help alleviate the nearly-frozen credit markets.