Goldman Exceeds Estimates on Stock Underwriting, Pay Costs (Bloomberg)
Goldman Sachs, the Wall Street bank with the highest return on equity, reported earnings that beat analysts’ estimates as equity-underwriting fees doubled and full-year compensation costs fell to the second-lowest percent of revenue since the firm went public in 1999. Fourth-quarter net income dropped 19 percent to $2.33 billion, or $4.60 a share, from $2.89 billion, or $5.60, a year earlier, the New York-based company said today in a statement. That surpassed the $4.18 average estimate of 25 analysts in a Bloomberg survey. Chief Executive Officer Lloyd C. Blankfein, 59, is keeping a lid on compensation costs and relying on investment-banking revenue amid a slowdown in trading, and has said Goldman Sachs doesn’t need a major strategy change to boost return on equity. While the firm’s stock jumped 39 percent in 2013, it was also the fourth straight year returns fell below the level achieved in the decade before the financial crisis.
Citigroup Earnings Rise but Fall Short of Wall Street Estimates (WSJ)
Citigroup reported a profit of $2.69 billion, or 85 cents a share, compared with a profit of $1.2 billion, or 38 cents a share, for the fourth quarter of 2012, which was weighed down by $2.3 billion in legal charges and costs tied to layoffs. Revenue edged down 0.8% to $17.78 billion. Meanwhile, stripping out one-time items and accounting adjustments, per-share earnings were up at 82 cents from 69 cents. Revenue dropped 2.5% on an adjusted basis to $17.94 billion. Analysts polled by Thomson Reuters had expected per-share earnings of 95 cents on revenue of $18.18 billion. Citigroup “didn’t finish the year as strongly as we would have liked,” said Chief Executive Michael Corbat, in prepared remarks.
BlackRock Fourth-Quarter Income Rises 22% (WSJ)
BlackRock rode the fourth-quarter U.S. stock rally to new highs, growing assets under management to $4.32 trillion and boosting its profit by 22% from the year-ago quarter. The results, which topped Wall Street expectations, allowed the world’s largest asset manager to boost its quarterly dividend to $1.93 a share from $1.68. Following the results, BlackRock shares rallied in pre-open trading to all-time highs, up $14.25, or 4.6%, to $327. BlackRock benefitted from the new highs in U.S. equity markets as retail investors flocked to its products, with $16.6 billion in retail net flows and another $19.1 billion into its iShares assets, the exchange-traded fund products it runs. BlackRock is also the nation’s largest ETF provider.
A-Rod breaks silence on drug ban: I was ready for break from baseball (NYP)
Rodriguez, speaking in Spanish at an appearance in Mexico, broke his silence when he spoke with the media Wednesday for the first time since an independent arbitrator suspended him for the entire season. “I think that the year 2014 could be a big favor that [Major League Baseball has] done for me because I’ve been playing for 20 years without a timeout,” he said. “I think 2014 is a good year to rest mentally and physically and prepare for the future and begin a new chapter in my life.”
BofA Overtakes JPMorgan for Investment-Banking Fees (Bloomberg)
Bank of America Corp., the second-biggest U.S. lender, took in more investment-banking fees than larger rival JPMorgan Chase & Co. (JPM) for the first time since acquiring Merrill Lynch & Co. during the financial crisis. Fees for debt and equity issuance, as well as advice for activities including mergers, rose 17 percent to $6.41 billion last year at Charlotte, North Carolina-based Bank of America. That edged out New York-based JPMorgan’s $6.33 billion in such revenue for the first time since 2008.
Euro zone inflation slows in December on one-off effect in Germany (Reuters)
Euro zone inflation slowed in December, the European Union’s statistics office confirmed on Thursday, in what the European Central Bank attributed last week to a one-off change in the method of calculating price growth in Germany. Consumer prices in 17 countries sharing the euro last year rose 0.3 percent on the month, putting the annual inflation rate at 0.8 percent, down from 0.9 percent in November, but a tad above 0.7 percent in October. The ECB, which wants to keep inflation below, but close to 2 percent over the medium term, expects a prolonged period of low inflation but sees no immediate risk of deflation.
Jobless Claims in U.S. Fall to Lowest in More Than a Month (Bloomberg)
Jobless claims decreased by 2,000 to 326,000 in the week ended Jan. 11, the least since the end of November, from a revised 328,000 in the prior period, a Labor Department report showed today in Washington. The median forecast of 51 economists surveyed by Bloomberg called for 328,000. A Labor Department spokesman said no states were estimated and there was nothing unusual in the data.
Two men robbed of their marijuana in Westlake after practicing medieval swordfighting, police said (C0)
Police said Sebastian Wozniak and another man were robbed when they tried to sell marijuana to a group of teenagers. When police questioned him and the other man about the robbery, they neglected to say that the theft took place during an attempted drug deal, police said. Wozniak was charged with trafficking marijuana, obstructing justice and possessing criminal tools. Those charges were bound over to a Cuyahoga County grand jury, but were eventually returned to Rocky River Municipal Court and reduced to misdemeanors. He pleaded guilty to the reduced charges and on Tuesday the case was set for sentencing. Klier faces charges of trafficking marijuana and obstructing justice. Both charges have been bound over to a Cuyahoga County grand jury. According to police, Wozniak, 20, and Anthony Klier, 22, of Avon Lake, met a group of teenagers in the parking lot of a Westlake Taco Bell on Sept. 4 to practice medieval sword-fighting. “But that’s clearly not what ended up happening,” said Capt. Guy Turner, public information officer for the Westlake police department.