Goldman Sachs Group Inc.

posted record third-quarter revenue boosted by a rapid pace of growth in its investment bank that eclipsed

Wall Street

rivals.

The firm reported US$2.66 billion in investment banking fees, a 42 per cent surge on the same period last year, the bank said Tuesday. That pace beat rivals and helped the company as a whole report revenue of US$15.18 billion, its largest haul for that quarter in its history and its third highest overall for all quarters.

But with the jump in fees came higher compensation costs, which helped drive a 14 per cent increase in operating expenses to US$9.45 billion. The bank is planning an additional round of job cuts this year, telling staff to expect a “limited reduction in roles,” Bloomberg reported Tuesday.

Goldman’s shares were down about 1.9 per cent at 12:11 p.m. in New York trading after paring earlier losses amid broader market declines. Before the market opened on Tuesday, the bank’s stock had outperformed its biggest peers this year, as it continued to lift expectations by surpassing estimates.

A rush of sizable mergers and acquisitions is lifting dealmakers across Wall Street after trade uncertainty had stifled activity. Global deal values topped US$1 trillion in a third quarter for only the second time on record, helped by a slew of headline-grabbing transactions, according to data compiled by Bloomberg.

Goldman appeared to benefit in particular. Its fee growth outpaced a 16 per cent rise at

JPMorgan Chase & Co.

and Citigroup’s 17 per cent jump.

Goldman’s fees included US$1.4 billion from its advisory unit, US$465 million from equity underwriting and US$788 million from debt underwriting. All three beat predictions.

The firm’s fixed-income traders reported US$3.47 billion of revenue, tightening their gap with the bank’s sector-leading stock trading unit, which posted US$3.74 billion — lower than expected — following two consecutive blowout quarters.

Trading activity has been elevated since

U.S. President Donald Trump

took office and rolled out a slew of tariff policies that set off swings across equity, currency and bond markets.

  • Goldman urges investors to buy gold and oil
  • Goldman puts US$4,000 gold on the agenda

Total management fees in Goldman’s asset and wealth management arm — a key growth area for the bank — rose to a record. The division’s assets also grew to a record US$3.45 trillion, and it announced on Monday that it was buying a venture capital investor. It’s now looking to compete with larger rivals by growing in private markets.

Bloomberg.com