Goldman Sachs , the largest investment bank by market value, said on Tuesday quarterly earnings rose 29% to a new record, despite recent fears that mortgage market woes and flagging stocks would hurt results.
The world's top merger advisor and stock underwriter said earnings increased to $3.2 billion, or $6.67 a share, in the three months ended Feb. 28, up from of $2.48 billion, or $5.08, in the year-ago period. Revenue rose 22% to a record $12.73 billion from $10.34 billion.
Analysts surveyed by Thomson Financial predicted quarterly profit to drop to $4.90 a share, with revenues of $10.68 billion.
Goldman kicked off the earnings reporting period for investment banks at a time of growing uncertainty about the outlook of financial markets worldwide. After most Wall Street firms delivered a third consecutive year of record profit in 2006, banks face a more difficult environment marked by worries about economic growth.
Yet Goldman remains the Street's most successful trading house, is by far the most active M&A adviser and has reaped big profits from investing its own money.
"While market conditions will regularly shift, we are confident that our client-driven strategy will continue to produce the strongest results for the firm," said Chairman and Chief Executive Lloyd Blankfein in a statement.
Goldman's trading and principle investment business was a key driver for the period, with revenues climbing 35% to $9.42 billion from the same quarter last year.
The company also said that although the subprime mortgage sector experienced "significant weakness, the broader credit environment remained strong."
Shares of Goldman were indicated to open higher on the New York Stock Exchange.