Goldman Sachs 3Q16 Earnings Call Notes

Goldman Sachs Group’s (GS) Management on Q3 2016 Results

More favorable backdrop

“Ultimately a more favorable backdrop and improved client sentiment translated into year-over-year revenue growth in three of our four business segments. ”

Launched online personal loan platfrom

“Last week we launched a new online personal loan platform Marcus by Goldman Sachs. Marcus’ goal is to enter the consumer credit market and provide a product that is simple, transparent, flexible and provides consumers with real value. Like any new effort, we are taking a slow and methodical approach with Marcus. We are leveraging all the firm’s pre-existing strengths across risk management and technology and we have brought an experienced team of consumer lending professionals to drive Marcus forward led by Harit Talwar.”

Brexit could drive share to the US

“I would say that Brexit potentially is something that could drive share to the U.S. I think what we’ve witnessed over the last several years is U.S. firms like ourselves with really, really strong market shares and leading business positions whether you look at FICC, investment banking, equities, asset management, if you’re a leader in a franchise throughout this cycle, particularly as activity picks up, I think there is share to gain. I think our European clients need us. But in terms of Brexit, I think it’s unclear whether that’s having any impact at this stage. It feels like early days.”

M&A pipeline feels pretty good

“So the pipeline feels pretty good when you talk our M&A team. And the backlog sequentially was up, not down. But the activity levels that I mentioned in terms of completed transactions in the market, obviously down over year after very, very healthy levels. The best perspective I can share with you is the one I get from talking to our M&A bankers. And it hasn’t shifted much over the course of the year. The same fundamental factors that are contributing to the last two years of M&A activity, generally low topline growth, a desire to drive efficiencies, access to the capital markets, all those factors still in place.”

Still feel reasonably good about activity in IPO markets

“So in underwriting as you saw, we’ve had very strong debt performance and we had a record for the first nine months of this year on a year-to-date basis. I mentioned before that half year IPO volume or meaningful portion of the IPO volume actually occurred in September. So it does feel like we are starting now again into a market where a lot of that activity that got pushed from the first quarter into the second quarter that that still exists. So we feel reasonably good about activity levels in the capital markets on an intermediate basis.”