Goldman Sachs, Comerica Q3 Earnings Hold Mixed Results

Commercial Two BH

DS News reports the highs and lows for earnings of some of the mortgage industry’s leading entities in Q3.

Goldman Sachs

The past three quarters of 2016 have shown the ups and downs for Goldman Sachs for earnings and overall business operations: in the first quarter, everything was down; in the second quarter, everything is back up; and the third quarter reports a mixed bag.

According to the investment banking firm’s Q3 2016 earnings report released Tuesday, Goldman Sachs reported net earnings of $1.54 billion for Q3. This was a decrease from $1.82 billion in the second quarter but essentially unchanged compared with the third quarter of 2015. Diluted earnings per common share in Q3 were $4.88, compared to $2.90 in the same quarter the year prior and $3.72 for Q2 2016.

“We saw solid performance across the franchise that helped counter typical seasonal weakness,” said Lloyd C. Blankfein, Chairman and Chief Executive Officer. “We continue to manage our balance sheet conservatively and are benefiting from the breadth of our offerings to clients.”

Additionally, net revenues in debt securities and loans were significantly higher compared with the third quarter of 2015, reflecting higher net interest income. These net revenues were $1.40 billion for the third quarter of 2016, more than double the amount in the third quarter of 2015 and 26 percent higher than the second quarter of 2016.

Comerica Incorporated

Comerica Incorporated also released their latest earnings report, showing positive earnings across the board for third quarter of 2016. Net income was $149 million for Q3, compared to $104 million for the second quarter 2016 and $136 million for the third quarter 2015. Earnings per diluted share were also up with 84 cents reported for third quarter 2016. This is compared to 58 cents for second quarter 2016 and 74 cents for third quarter 2015.

“Quarter over quarter, our earnings per share increased 45 percent. This reflected strong credit quality, a reduction in restructuring charges, solid revenue growth and well-managed expenses,” said Babb. “While loans were relatively stable, average deposit growth was robust, increasing $1.5 billion. Criticized loans declined and net charge-offs were only 13 basis points of average loans. Our capital position remains solid. In line with our CCAR plan, we increased our share repurchases to 2.1 million shares for a total of $97 million, compared to $65 million in the second quarter.

Comerica’s average balance of residential mortgage loans increased slightly from $1.880 billion in Q2 to $1.883 billion in the third quarter. This was also a marginal increase from the third quarter in 2015 of $1.882 billion.

Average loans for Comerica did decrease $331 million, primarily reflecting decreases in Energy, National Dealer Services and Technology and Life Sciences, partially offset by an increase in Mortgage Banker Finance.

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