GOLDMAN SACHS GROUP INC
For the period ended Dec 31, 2024. Filed Feb 27, 2025.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2024 · Filed Feb 27, 2025
GS$865.82-0.4%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2023-12-31; filed 2024-02-23.
0000886982-24-000006
Item 7. Results of OperationsBalance Sheet and Funding SourcesCapital Management and Regulatory CapitalRegulatory and Other MattersOff-Balance Sheet ArrangementsRisk ManagementOverview and Structure of Risk ManagementLiquidity Risk ManagementMarket Risk ManagementCredit Risk ManagementOperational Risk ManagementModel Risk ManagementOther Risk ManagementCurrent report: 10-K
Period ended 2024-12-31; filed 2025-02-27.
0000886982-25-000005
Item 7. Results of OperationsBalance Sheet and Funding SourcesCapital Management and Regulatory CapitalRegulatory and Other MattersOff-Balance Sheet ArrangementsRisk ManagementOverview and Structure of Risk ManagementLiquidity Risk ManagementMarket Risk ManagementCredit Risk ManagementOperational Risk ManagementModel Risk ManagementOther Risk ManagementThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 685 previous paragraphs and 707 current paragraphs.
474 unchanged; 174 reworded; 55 added; 35 removed; 2 previous and 4 current paragraphs rearranged.
Tables are not compared: 80 previous and 82 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (55)
Current report
Net revenues in the consolidated statements of earnings were $53.51 billion for 2024, 16% higher than 2023, primarily reflecting significantly higher other principal transactions revenues, net interest income and investment banking revenues and higher investment management revenues.
Current report
Commissions and fees in the consolidated statements of earnings were $4.09 billion for 2024, 8% higher than 2023, due to higher commissions and fees in Equities, reflecting generally higher market volumes and increased transaction fees, partially offset by a loss related to the planned transition of the GM credit card program to another issuer.
Current report
Other principal transactions revenues in the consolidated statements of earnings were $4.65 billion for 2024, 119% higher than 2023, primarily reflecting significantly higher net gains from investments in private equities, significantly higher net gains from derivatives related to our funding activities, the impact of the sale of the Marcus loan portfolio in 2023 (including net revenues of approximately $(370) million related to the sale of substantially all of the portfolio) and significantly lower net losses on hedges related to our relationship lending portfolio.
Current report
As of December 2024, headcount increased 3% compared with December 2023, primarily due to increases in Asset & Wealth Management, Risk and Compliance, partially offset by the impact of the sale of GreenSky.
Current report
On August 26, 2024, the U.S. Tax Court issued a decision in Varian Medical Systems, Inc. v. Commissioner (Varian decision). The Varian decision reduced the U.S. tax on the deemed repatriation of unremitted foreign earnings of applicable non-U.S. subsidiaries in the transition year of the Tax Cuts and Jobs Act. We are monitoring the Varian decision and evaluating its impact, which could be a material income tax benefit, on the deemed repatriation tax we incurred for the 2018 tax year. No income tax benefit has been recognized in the provision for income taxes as a result of the Varian decision as of December 2024.
Current report
•The increase in net interest income within FICC for 2024 compared with 2023 reflected an increase in interest-earning assets. Due to the nature of activities within FICC and Equities and the composition of their associated balance sheet, we assess the performance of these businesses based on total net revenues, as offsets can occur across revenue line items. For example, cash instruments that generate interest income are, in some cases, hedged or funded by derivatives for which changes in fair value are reflected in market making revenues. Also, certain activities produce market making revenues but incur interest expense related to the funding of the related inventory.
Current report
In January 2025, we formed the Capital Solutions Group in Global Banking & Markets, which provides a more comprehensive suite of our financing, origination, structuring and risk management offerings across both public and private markets. This group includes the current capabilities of our financing group and expands its coverage to financial sponsors and alternative asset management firms. It also includes an alternatives origination group focused on sourcing, to provide seamless coverage to our private credit and private equity clients. We believe that a more integrated set of these capabilities will allow us to better serve our clients as these private markets continue to grow.
Current report
Net revenues in Other were $576 million for 2024, compared with $171 million for 2023, with the increase primarily reflecting significantly lower net losses on hedges.
Current report
Operating expenses were $19.98 billion for 2024, 11% higher than 2023, primarily due to significantly higher transaction based expenses and higher compensation and benefits expenses (reflecting improved operating performance). Pre-tax earnings were $14.92 billion for 2024, 29% higher than 2023.
Current report
In the table above, gross loans included $38 billion of loans as of December 2024 and $33 billion of loans as of December 2023 that were related to Private banking and lending.
Current report
In the table above, Management and other fees included fees from alternatives of $2.18 billion for 2024, $2.13 billion for 2023 and $1.85 billion for 2022.
Current report
Operating expenses were $11.83 billion for 2024, 9% lower than 2023, due to significantly lower expenses, including impairments, related to commercial real estate in CIEs, partially offset by higher compensation and benefits expenses (reflecting improved operating performance). Pre-tax earnings were $4.55 billion for 2024, compared with $1.36 billion for 2023.
Current report
Total wealth management client assets (consisting of AUS, brokerage assets and Marcus deposits) were approximately $1.6 trillion as of December 2024.
Current report
•During 2024, our AUS increased $325 billion due to net inflows (across all asset classes) and net market appreciation (primarily in equity assets).
Current report
•During 2023, our AUS increased $265 billion due to net market appreciation (primarily in equity and fixed income assets) and net inflows (driven by fixed income assets, liquidity products and alternative investments assets), partially offset by the impact of dispositions (related to the sale of Personal Financial Management (PFM)).
Current report
•During 2022, our AUS increased $77 billion due to the impact of acquisitions (primarily related to the acquisition of NN Investment Partners) and net inflows (across all asset classes), partially offset by net market depreciation (primarily in fixed income and equity assets).
Current report
The table below presents information about our total AUS net inflows/(outflows) by client channel.
Current report
Our target is to grow our total credit alternative assets to $300 billion by the end of 2028.
Current report
Notwithstanding our strategic decision to narrow the focus on consumer-related activities, Consumer platforms net revenues were slightly higher compared with 2023, reflecting higher average credit card balances and higher average deposit balances, largely offset by the impact of the planned transition of the GM credit card program to another issuer. Transaction banking and other net revenues were lower, primarily reflecting lower net revenues related to the seller financing loan portfolio that was sold during 2024. See “Regulatory and Other Matters — Other Matters — Narrowing our Focus on Consumer-Related Activities” for further information.
Current report
The table below presents the types and sources of deposits.
Current report
•Savings and demand accounts consist of money market deposit accounts, negotiable order of withdrawal accounts and demand deposit accounts that have no stated maturity or expiration date.
Current report
•Time deposits had a weighted average maturity of approximately 0.6 years as of both December 2024 and December 2023.
Current report
•Consumer deposits consist of deposits from both Marcus and Apple Card customers.
Current report
•Deposit sweep programs include contractual agreements with U.S. broker-dealers who sweep client cash to FDIC-insured deposits.
Current report
•Transaction banking deposits consist of deposits that we raised through our cash management services business for corporate and other institutional clients.
Current report
•Other deposits are substantially all from institutional clients.
Current report
•Deposits insured by the FDIC were $234.54 billion as of December 2024 and $221.52 billion as of December 2023.
Current report
•Deposits insured by non-U.S. insurance programs were $25.98 billion as of December 2024 and $26.00 billion as of December 2023.
Current report
Narrowing our Focus on Consumer-Related Activities. During 2023 and 2024, we narrowed our focus with respect to consumer-related activities by taking the following actions:
Current report
•We completed the sale of substantially all of the Marcus loan portfolio in 2023 (included within Asset & Wealth Management).
Current report
•We sold our PFM business in 2023 (included within Asset & Wealth Management).
Current report
•We sold the majority of the GreenSky loan portfolio in 2023 and, during 2024, completed the sale of GreenSky (included within Platform Solutions).
Current report
•During 2024, we entered into an agreement to transition the GM credit card program (included within Platform Solutions) to another issuer. The transition is expected to be completed in the third quarter of 2025.
Current report
•During 2024, we sold our seller financing loan portfolio (included within Platform Solutions). This portfolio consisted of loans that were extended to small- and medium-sized retailers.
Current report
We remain committed to supporting the products and servicing customers through the various transition arrangements for our consumer-related activities.
Current report
The table below presents the impact to pre-tax earnings of the items that we sold or have announced the decision to sell (with respect to the narrowing of our focus on consumer-related activities).
Current report
In the table above, pre-tax earnings related to GreenSky, the GM credit card program and the seller financing loan portfolio were included within Platform Solutions and the pre-tax earnings related to the Marcus loan portfolio and PFM were included within Asset & Wealth Management.
Current report
We have the following remaining consumer-related activities within Platform Solutions:
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Removed paragraphs (35)
Previous report
Net revenues in the consolidated statements of earnings were $46.25 billion for 2023, 2% lower than 2022, primarily reflecting lower net interest income and lower investment banking revenues, partially offset by significantly higher net revenues in other principal transactions.
Previous report
Commissions and fees in the consolidated statements of earnings were$3.79 billion for 2023, 6% lower than 2022, primarily reflecting the impact of GreenSky in the prior year period.
Previous report
Other principal transactions revenues in the consolidated statements of earnings were $2.13 billion for 2023, 225% higher than 2022, primarily reflecting net gains from derivatives related to our borrowings.
Previous report
As of December 2023, headcount decreased 7% compared with December 2022, primarily reflecting a headcount reduction initiative during the year.
Previous report
In May 2023, the New York State fiscal year 2024 budget was enacted. The legislation extends the temporary increase in the New York State corporate income tax rate from 6.5% to 7.25% through calendar year 2026. In December 2023, the New York State Department of Taxation and Finance published final regulations that implemented comprehensive franchise tax reform for corporations, banks and insurance companies, which was enacted in 2014. The legislation and final regulations did not have a material impact on our 2023 annual effective tax rate and are not expected to have a material impact on our 2024 annual effective tax rate.
Previous report
We expect our 2024 tax rate to be approximately 22%, including the impact of any Pillar II taxes, based on our current interpretation of the guidance published by the OECD and enacted legislation.
Previous report
Net revenues in Other were $171 million, compared with $(537) million for 2022, reflecting the absence of net mark-downs on acquisition financing activities included in the prior year and net gains from direct investments compared with net losses in the prior year. These improvements were partially offset by significantly higher net losses on hedges.
Previous report
Operating expenses were $18.04 billion for 2023, essentially unchanged compared with 2022. Pre-tax earnings were $11.56 billion for 2023, 18% lower than 2022.
Previous report
We also raise deposits and have issued unsecured loans to consumers through Marcus. During 2023, we completed the sale of substantially all of the Marcus loans portfolio.
Previous report
Operating expenses were $13.03 billion for 2023, 13% higher than 2022, largely due to significantly higher impairments related tocommercial real estate within CIEs. Pre-tax earnings were $1.36 billion for 2023, 4% higher than 2022.
Previous report
In the table above, dispositions for 2023 included outflows from the disposition of PFM, with substantially all of the outflows in equity and fixed income assets. Acquisitions for 2022 included inflows from the acquisitions of NNIP and NextCapital Group, Inc., and from the acquisition of the assets of Bombardier Global Pension Asset Management Inc. For each, substantially all of the inflows were in fixed income and equity assets.
Previous report
In the table above, our average effective management fee for liquidity products increased during both 2023 and 2022 compared to 2021, primarily reflecting higher management fee waivers in 2021.
Previous report
We announced a strategic objective of growing our third-party alternatives business and established a target of achieving gross inflows of $225 billion for alternative investments from 2020 through the end of 2024. We surpassed this target in 2023.
Previous report
•Office-related investments included in loans were $0.2 billion, in debt securities were $0.1 billion, in equity securities were $0.3 billion, and in CIE investments, net of financings, were $0.6 billion.
Previous report
•Office-related equity securities and CIE investments, net of financings, were marked down or impaired by approximately 50% during 2023 and non-office-related equity securities and CIE investments, net of financings, were marked down or impaired by approximately 15% during 2023.
Previous report
•Commercial real estate investments consisted of approximately 38% of historical principal investments, which we intend to exit over the medium term (three to five year time horizon from year-end 2022).
Previous report
In the table above, during the second quarter of 2023, certain CIE investments included within the other asset class were reclassified to the industrials asset class. Prior period amounts have been conformed to the current presentation.
Previous report
The increase in Consumer platforms net revenues primarily reflected significant growth in average credit card balances. Transaction banking and other net revenues were lower, reflecting lower deposit spreads.
Previous report
We submitted our 2023 resolution plan in June 2023. See "Business — Available Information" in Part I, Item 1 of this Form 10-K for information about the public portion of our resolution plan submission. GS Bank USA submitted its 2023 resolution plan in December 2023.
Previous report
In the table above, the risk-based capital requirements incorporate capital guidance received from the PRA and could change in the future.
Previous report
GSI is also subject to a minimum requirement for own funds and eligible liabilities issued to affiliates. As of both December 2023 and December 2022, GSI was in compliance with this requirement.
Previous report
Our revenue-producing units, as well as Treasury, Engineering, Human Capital Management, Operations, and Corporate and Workplace Solutions, are considered our first line of defense. They are accountable for the outcomes of our risk-generating activities, as well as for assessing and managing those risks within our risk appetite.
Previous report
•Firmwide Risk Council. The Firmwide Risk Council is responsible for the ongoing monitoring of relevant financial risks at the firmwide, business and product levels. This council is co-chaired by our chief financial officer and our chief risk officer.
Previous report
•Firmwide Conduct Committee. The Firmwide Conduct Committee is responsible for the ongoing approval and monitoring of the frameworks and policies which govern our conduct risks. Conduct risk is the risk that our people fail to act in a manner consistent with our Business Principles and related core values, policies or codes, or applicable laws or regulations, thereby falling short in fulfilling their responsibilities to us, our clients, colleagues, other market participants or the broader community. This committee is chaired by our chief legal officer, who is appointed as chair by the chairs of the Firmwide Enterprise Risk Committee.
Previous report
Firmwide Capital Comm ittee. The Firmwide Capital Committee provides approval and oversight of debt-related transactions, including principal commitments of our capital. This committee aims to ensure that business, reputational and suitability standards for underwritings and capital commitments are maintained on a global basis. This committee is co-chaired by our head of Credit Risk and a co-head of our Global Financing Group, who are appointed as chairs by the chair of the Firmwide Risk Appetite Committee.
Previous report
Firmwide Commitments Committee. The Firmwide Commitments Committee reviews our underwriting and distribution activities with respect to equity and equity-related product offerings, and sets and maintains policies and procedures designed to ensure that legal, reputational, regulatory and business standards are maintained on a global basis. In addition to reviewing specific transactions, this committee periodically conducts general strategic reviews of sectors and products and establishes policies in connection with transaction practices. This committee is co-chaired by our chief equity underwriting officer for the Americas, a co-chairman of our Global Financial Institutions Group, and a co-head of our Global Investment Grade Capital Markets and Risk Management Group in Global Banking & Markets, who are appointed as chairs by the chair of the Firmwide Risk Appetite Committee.
Previous report
Firmwide Suitability Committee. The Firmwide Suitability Committee is responsible for setting standards and policies for product, transaction and client suitability and providing a forum for consistency across functions, regions and products on suitability assessments. This committee also reviews suitability matters escalated from other committees. This committee is co-chaired by our chief compliance officer and an advisory director, who are appointed as chairs by the chair of the Firmwide Reputational Risk Committee.
Previous report
Treasury, which reports to our chief financial officer, has primary responsibility for developing, managing and executing our liquidity and funding strategy within our risk appetite.
Previous report
During the first quarter of 2023, we added the currency exposure on certain debt and equity positions to VaR and removed certain debt and equity positions (and related hedges) from VaR as our management believes that the risk of these positions is more appropriately measured and monitored using 10% sensitivity measures. Prior period amounts for average daily VaR, period end VaR and high and low VaR have been conformed to the current presentation. The impact of such changes to prior period total VaR was not material. Substantially all positions in VaR are included within Global Banking & Markets.
Previous report
In the table above, the frequency distribution of daily net revenues reflects the impact of the change in VaR described above. Prior period amounts have been conformed to the current presentation.
Previous report
•The 10% sensitivity measures for equity and debt positions reflect the impact of the change in VaR described above. Prior period amounts have been conformed to the current presentation.
Previous report
•The net charge-off ratio for commercial real estate loans was 0.7% for 2023. The net charge-off ratio is calculated by dividing net charge-offs by average gross loans accounted for at amortized cost.
Previous report
Beginning in the fourth quarter of 2023, we began to assess the credit quality of all U.S. residential mortgage loans extended to wealth management clients using FICO credit scores, loan-to-value ratios and delinquency, instead of an internal credit rating, as we believe that these metrics better reflect the credit quality of such loans. In the table below, prior period amounts have been conformed to reflect the current methodology. The impact to residential real estate loans as of December 2022 was a decrease in loans and lending commitments classified as investment-grade of $2.5 billion (loans of $2.5 billion and lending commitments of $7 million), a decrease in loans and lending commitments classified as non-investment-grade of $2.9 billion (loans of $2.7 billion and lending commitments of $208 million) and an increase in other metrics of $5.4 billion (loans of $5.2 billion and lending commitments of $215 million).
Previous report
Economic challenges persist for the Argentine government given uncertainty relating to its fiscal and economic policies. As of December 2023, our total credit exposure to Argentina was not material. Our total market exposure to Argentina as of December 2023 was $157 million, primarily to sovereign issuers. Such exposure consisted of $55 million related to debt, $32 million related to credit derivatives and $70 million related to equities.
Previous report
•The Firmwide Operational Risk and Resilience Committee. See “Overview and Structure of Risk Management” for further information about this committee.
Reworded paragraphs (174)
Previous wording
Operating Environment. During 2023, the operating environment continued to be generally characterized by continued broad macroeconomic concerns, including the outlook for economic growth and inflation, and elevated geopolitical tensions. These factors weighed on industry-wide investment banking activity levels and market-making activity levels, and contributed to pressure in the commercial real estate market. However, improvements in the outlook for economic conditions contributed to generally higher global equity and bond prices compared with the end of 2022. In the U.S., inflationary measures improved, the rate of unemployment remained low and the pace of growth in consumer spending declined slightly compared with 2022.
Current wording
Operating Environment. During 2024, the operating environment was generally characterized by continued broad macroeconomic concerns, including concerns and uncertainty about inflation, ongoing geopolitical tensions, central bank policy and the potential outcome of national elections. In investment banking, industry-wide underwriting volumes increased compared with 2023, driven by strong levels of debt offerings and improved levels of equity offerings, while industry-wide completed mergers and acquisitions volumes remained below historical averages. In market making, activity levels were mixed, as activity levels in fixed income-related products decreased compared with the prior year, while activity levels in equity-related products increased. Global equity prices were generally higher compared with the end of 2023, and concerns about the commercial real estate market persisted. In the U.S., the rate of unemployment remained low and the pace of growth in consumer spending increased slightly compared with 2023.
Previous wording
If uncertainty and concerns about geopolitical tensions and the economic outlook remain elevated or grow, including those about global central bank policy, inflation, the commercial real estate sector, and potential increases in regulatory capital requirements, it may lead to a decline in asset prices, a further decline in market-making activity levels, or a further decline in investment banking activity levels, and net revenues and provision for credit losses would likely be negatively impacted. See “Segment Assets and Operating Results — Segment Operating Results” for information about the operating environment and material trends and uncertainties that may impact our results of operations.
Current wording
If uncertainty and concerns about geopolitical tensions and the economic outlook remain elevated or grow, including those about central bank policy, inflation and the commercial real estate sector, it may lead to a decline in asset prices, a decline in market-making activity levels, a decline in industry-wide investment banking volumes, and net revenues and provision for credit losses would likely be negatively impacted. See “Segment Assets and Operating Results — Segment Operating Results” for information about the operating environment and material trends and uncertainties that may impact our results of operations.
Previous wording
Non-Interest Revenues. Investment banking revenues in the consolidated statements of earnings were $6.22 billion for 2023, 16% lower than 2022, primarily due to significantly lower revenues in advisory, reflecting a significant decline in industry-wide completed mergers and acquisitions transactions, partially offset by significantly higher revenues in equity underwriting, primarily reflecting increased activity from secondary offerings.
Current wording
Non-Interest Revenues. Investment banking revenues in the consolidated statements of earnings were $7.74 billion for 2024, 24% higher than 2023, primarily reflecting significantly higher revenues in debt underwriting, primarily driven by leveraged finance activity, and in equity underwriting, primarily driven by secondary and initial public offerings. In addition, revenues in advisory were higher, reflecting an increase in completed mergers and acquisitions transactions.
Previous wording
Investment management revenues in the consolidated statements of earnings were $9.53 billion for 2023, 6% higher than 2022, due to higher management and other fees, primarily reflecting the impact of higher average AUS, including the impact of acquiring NN Investment Partners (NNIP).
Current wording
Investment management revenues in the consolidated statements of earnings were $10.60 billion for 2024, 11% higher than 2023, primarily due to higher management and other fees, primarily reflecting the impact of higher average assets under supervision (AUS).
Previous wording
Market making revenues in the consolidated statements of earnings were $18.24 billion for 2023, 2% lower than 2022, reflecting significantly lower revenues in FICC and Equities intermediation, largely offset by significantly higher revenues in FICC and Equities financing. The decrease from intermediation activities reflected significantly lower revenues in equity derivatives, commodities and currencies, partially offset by significantly improved results in mortgages. The increase from financing activities primarily reflected significantly higher revenues from equity financing.
Current wording
Market making revenues in the consolidated statements of earnings were $18.39 billion for 2024, essentially unchanged compared with 2023. Market making revenues from intermediation activities were slightly higher, primarily reflecting significantly higher revenues in equity cash products, currencies and mortgages, offset by significantly lower revenues in commodities and equity derivatives. Market making revenues from financing activities were essentially unchanged, reflecting significantly lower revenues in FICC financing, offset by significantly higher revenues from Equities financing.
Previous wording
Net Interest Income. Net interest income in the consolidated statements of earnings was $6.35 billion for 2023, 17% lower than 2022, reflecting a significant increase in interest expense primarily related to other interest-bearing liabilities, deposits, collateralized financings, and borrowings, each reflecting the impact of higher average interest rates. The increase in interest expense was partially offset by a significant increase in interest income primarily related to collateralized agreements, other interest-earning assets, deposits with banks, and loans, each reflecting the impact of higher average interest rates. See “Supplemental Financial Information—Statistical Disclosures— Distribution of Assets, Liabilities and Shareholders’ Equity” for further information about our sources of net interest income.
Current wording
Net Interest Income. Net interest income in the consolidated statements of earnings was $8.06 billion for 2024, 27% higher than 2023, reflecting an increase in interest income, partially offset by an increase in interest expense. The increase in interest income primarily related to trading assets and investments (each reflecting the impact of higher average balances and higher average interest rates), collateralized agreements and other interest-earning assets (each reflecting the impact of higher average interest rates), partially offset by a decrease in interest income related to deposits with banks (reflecting the impact of lower average balances). The increase in interest expense primarily related to collateralized financings and deposits (each reflecting the impact of higher average balances and higher average interest rates) and other interest-bearing liabilities (reflecting the impact of higher average interest rates). See “Supplemental Financial Information — Statistical Disclosures — Distribution of Assets, Liabilities and Shareholders’ Equity” for further information about our sources of net interest income.
Previous wording
2023 versus 2022. Provision for credit losses in the consolidated statements of earnings was $1.03 billion for 2023, compared with $2.72 billion for 2022. Provisions for 2023 reflected net provisions related to both the credit card portfolio (primarily driven by net charge-offs) and wholesale loans (primarily driven by impairments). These net provisions were partially offset by reserve reductions of $637 million related to the transfer of the GreenSky installment loan portfolio to held for sale and $442 million related to the sale of substantially all of the Marcus loans portfolio. Provisions for 2022 primarily reflected growth in the credit card portfolio, the impact of macroeconomic and geopolitical concerns and net charge-offs.
Current wording
2024 versus 2023. Provision for credit losses in the consolidated statements of earnings was $1.35 billion for 2024, compared with $1.03 billion for 2023. Provisions for 2024 reflected net provisions related to the credit card portfolio (primarily driven by net charge-offs). Provisions for 2023 reflected net provisions related to both the credit card portfolio (primarily driven by net charge-offs) and wholesale loans (primarily driven by impairments), partially offset by reserve reductions of $637 million related to the transfer of the GreenSky loan portfolio to held for sale and $442 million related to the sale of substantially all of the Marcus loan portfolio.
Previous wording
Our operating expenses are primarily influenced by compensation, headcount and levels of business activity. Compensation and benefits includes salaries, year-end discretionary compensation, amortization of equity awards and other items such as benefits. Discretionary compensation is significantly impacted by, among other factors, the level of net revenues, net of provision for credit losses, overall financial performance, prevailing labor markets, business mix, the structure of our share-based compensation programs and the external environment.
Current wording
Our operating expenses are primarily influenced by compensation, headcount and levels of business activity. Compensation and benefits includes salaries, year-end discretionary compensation, amortization of equity awards and other items such as benefits. Discretionary compensation is significantly impacted by, among other factors, the level of net revenues, net of provision for credit losses, overall financial performance, prevailing labor markets, business mix, the structure of our share-based awards and the external environment.
Previous wording
2023 versus 2022. Operating expenses in the consolidated statements of earnings were $34.49 billion for 2023, 11% higher than 2022. Our efficiency ratio was 74.6% for 2023, compared with 65.8% for 2022.
Current wording
2024 versus 2023. Operating expenses in the consolidated statements of earnings were $33.77 billion for 2024, 2% lower than 2023. Our efficiency ratio was 63.1% for 2024, compared with 74.6% for 2023.
Previous wording
The increase in operating expenses compared with 2022 primarily reflected significantly higher impairments related to commercial real estate within CIEs ($1.46 billion recognized in 2023), a write-down of identifiable intangible assets of $506 million related to GreenSky and an impairment of goodwill of $504 million related to Consumer platforms (all in depreciation and amortization), as well as the FDIC special assessment fee of $529 million (in other expenses). Net provisions for litigation and regulatory proceedings were $115 million for 2023 compared with $576 million for 2022.
Current wording
Operating expenses, compared with 2023, reflected decreases driven by significantly lower expenses, including impairments ($1.46 billion recognized in 2023), related to commercial real estate in CIEs (largely in depreciation and amortization) and other significant expenses recognized in the prior year, including the write-down of identifiable intangible assets related to GreenSky of $506 million and an impairment of goodwill related to Consumer platforms of $504 million (both in depreciation and amortization), and the FDIC special assessment fee of $529 million (in other expenses). These decreases were partially offset by higher compensation and benefits expenses (reflecting improved operating performance) and higher transaction based expenses. An incremental expense for the FDIC special assessment fee of $71 million was recognized in 2024, as the FDIC notified banks subject to the special assessment fee of the updated estimated cost to the Deposit Insurance Fund resulting from the closures in 2023 of Silicon Valley Bank and Signature Bank. Net provisions for litigation and regulatory proceedings were $166 million for 2024 compared with $115 million for 2023.
Previous wording
The effective income tax rate for 2023 was 20.7%, up from the full year income tax rate of 16.5% for 2022, primarily resulting from an increase in taxes on non-U.S. earnings in 2023, partially offset by an increase in the impact of permanent tax benefits for 2023 compared with 2022.
Current wording
The effective income tax rate for 2024 was 22.4%, up from the full year income tax rate of 20.7% for 2023, primarily due to a decrease in the impact of permanent tax benefits for 2024 compared with 2023, partially offset by changes in the geographic mix of earnings.
Previous wording
The Organisation for Economic Co-operation and Development (OECD) Global Anti-Base Erosion Model Rules (Pillar II) aim to ensure that multinationals with revenues in excess of EUR 750 million pay a minimum effective corporate tax rate of 15% in each jurisdiction in which they operate. The U.K. and other jurisdictions in which we operate have adopted certain portions of the OECD directive (Pillar II legislation) effective beginning in calendar year 2024. In February 2023, the U.S. Financial Accounting Standards Board released guidance that it believes Pillar II is an alternative minimum tax, and therefore deferred tax assets and liabilities should not be remeasured for its estimated future effects and any additional tax should be recognized in the period incurred. We do not expect the impact on our 2024 annual effective tax rate to be material.
Current wording
The Organisation for Economic Co-operation and Development (OECD) Global Anti-Base Erosion Model Rules (Pillar II) aim to ensure that multinationals with revenues in excess of EUR 750 million pay a minimum effective corporate tax rate of 15% (minimum tax) in each jurisdiction in which they operate. The U.K. and other jurisdictions in which we operate have adopted certain portions of the OECD directive (Pillar II legislation) effective beginning in calendar year 2024. The Pillar II legislation did not have a material impact on our effective tax rate for 2024. We expect additional guidance or legislation to be issued by the OECD and various jurisdictions during 2025 which could impact any minimum tax we owe in future periods, possibly materially, and our effective tax rate could increase in 2025 and thereafter. This minimum tax, if any, will be recognized in the period in which it is incurred.
Previous wording
The allocation process for segment assets is based on the activities of these segments. The allocation of assets includes allocation of GCLA (which consists of unencumbered, highly liquid securities and cash), which is generally included within cash and cash equivalents, collateralized agreements and trading assets on our balance sheet. Due to the integrated nature of these segments, estimates and judgments are made in allocating these assets. See “Risk Management — Liquidity Risk Management” for further information about our GCLA.
Current wording
The allocation process for segment assets is based on the activities of these segments. The allocation of assets includes allocation of GCLA (which consists of unencumbered, highly liquid securities and cash), which is included within cash and cash equivalents, collateralized agreements, trading assets and investments on our balance sheet. Due to the integrated nature of these segments, estimates and judgments are made in allocating these assets. See “Risk Management — Liquidity Risk Management” for further information about our GCLA.
Previous wording
Net revenues in our segments include allocations of interest income and expense to specific positions in relation to the cash generated by, or funding requirements of, such positions. See Note 25 to the consolidated financial statements for further information about our business segments.
Current wording
Net revenues in our segments include allocations of interest income and expense based on the funding generated by, or the funding and liquidity requirements of, the respective segments. See Note 25 to the consolidated financial statements for further information about our business segments.
Previous wording
•Equities financing. Includes prime financing, which provides financing to our clients for their securities trading activities through margin loans that are collateralized by securities, cash or other collateral. Prime financing also includes services which involve lending securities to cover institutional clients’ short sales and borrowing securities to cover our short sales and to make deliveries into the market. We are also an active participant in broker-to-broker securities lending and third-party agency lending activities. In addition, we execute swap transactions to provide our clients with exposure to securities and indices. Financing activities also include portfolio financing, which clients can utilize to manage their investment portfolios, and other equity financing activities, including securities-based loans to individuals.
Current wording
•Equities financing. Includes prime financing, which provides financing to our clients for their securities trading activities through margin loans that are generally collateralized by securities or cash. Prime financing also includes services which involve lending securities to cover institutional clients’ short sales and borrowing securities to cover our short sales and to make deliveries into the market. We are also an active participant in broker-to-broker securities lending and third-party agency lending activities. In addition, we execute swap transactions to provide our clients with exposure to securities and indices. Financing activities also include portfolio financing, which clients can utilize to manage their investment portfolios, and other equity financing activities, including securities-based loans to individuals.
Previous wording
Our average Global Banking & Markets gross loans were $112.07 billion for 2023 and $105.11 billion for 2022.
Current wording
Our average Global Banking & Markets gross loans were $126.87 billion for 2024 and $112.07 billion for 2023.
Previous wording
Operating Environment. During 2023, Global Banking & Markets operated in an environment generally characterized by continued broad macroeconomic concerns, including the outlook for economic growth and inflation, and elevated geopolitical stresses. These factors weighed on industry-wide investment banking activity levels and market-making activity levels.
Current wording
Operating Environment. During 2024, Global Banking & Markets operated in an environment generally characterized by continued broad macroeconomic concerns, including concerns and uncertainty about inflation, prolonged geopolitical stresses and central bank policy, and the potential outcomes of the national elections.
Previous wording
In investment banking, industry-wide completed mergers and acquisitions transactions declined compared with elevated levels in the prior year, while industry-wide equity and debt underwriting volumes remained below historical averages.
Current wording
In investment banking, industry-wide debt underwriting volumes for the year increased significantly compared with the prior year, driven by strong levels of leveraged finance and investment-grade offerings. However, industry-wide equity underwriting volumes, despite improving year-over-year, and industry-wide completed mergers and acquisitions volumes remained below historical averages.
Previous wording
In interest rates, the yields on 10-year U.S. and U.K government bonds increased during the middle of the year before declining to yields near where they ended in 2022. In equities, the S&P 500 Index increased by 24% and the MSCI World Index increased by 20% compared with the end of 2022.
Current wording
In interest rates, the yields on 10-year U.S. and U.K. government bonds increased during the year. In equities, the S&P 500 Index increased by 23% and the MSCI World Index increased by 16% compared with the end of 2023.
Previous wording
In the future, if market and economic conditions deteriorate, and market-making activity levels decline further or investment banking activity levels decline further, or credit spreads related to hedges on our relationship lending portfolio tighten, net revenues in Global Banking & Markets would likely be negatively impacted. In addition, if economic conditions deteriorate further or if the creditworthiness of borrowers deteriorates, provision for credit losses would likely be negatively impacted.
Current wording
In the future, if market and economic conditions deteriorate, and market-making activity levels decline, industry-wide investment banking volumes decline, or credit spreads related to hedges on our relationship lending portfolio tighten, net revenues in Global Banking & Markets would likely be negatively impacted. In addition, if economic conditions deteriorate or if the creditworthiness of borrowers deteriorates, provision for credit losses would likely be negatively impacted.
Previous wording
2023 versus 2022. Net revenues in Global Banking & Markets were $30.00 billion for 2023, 8% lower than a strong 2022.
Current wording
2024 versus 2023. Net revenues in Global Banking & Markets were $34.94 billion for 2024, 16% higher than 2023.
Previous wording
Investment banking fees were $6.22 billion, 16% lower than 2022, due to significantly lower net revenues in Advisory, reflecting a significant decline in industry-wide completed mergers and acquisitions transactions, and slightly lower net revenues in Debt underwriting, partially offset by significantly higher net revenues in Equity underwriting, primarily reflecting increased activity from secondary offerings.
Current wording
Investment banking fees were $7.73 billion, 24% higher than 2023, primarily reflecting significantly higher net revenues in Debt underwriting, primarily driven by leveraged finance activity, and in Equity underwriting, primarily driven by secondary and initial public offerings. In addition, net revenues in Advisory were higher, reflecting an increase in completed mergers and acquisitions transactions.
Previous wording
As of December 2023, our Investment banking fees backlog decreased compared with the end of 2022, due to significantly lower estimated net revenues from both potential equity underwriting transactions (primarily from initial public offerings) and potential debt underwriting transactions (primarily from structured finance offerings).
Current wording
As of December 2024, our Investment banking fees backlog increased compared with the end of 2023, primarily reflecting higher estimated net revenues from potential advisory transactions.
Previous wording
Net revenues in FICC were $12.06 billion, 18% lower than a strong 2022, reflecting significantly lower net revenues in FICC intermediation, driven by significantly lower net revenues in currencies and commodities and slightly lower net revenues in interest rate products, partially offset by significantly higher net revenues in mortgages and higher net revenues in credit products. Net revenues in FICC financing were slightly lower.
Current wording
Net revenues in FICC were $13.20 billion, 9% higher than 2023, primarily reflecting significantly higher net revenues in FICC financing, primarily driven by mortgages and structured lending. Net revenues in FICC intermediation were slightly higher, driven by significantly higher net revenues in currencies, mortgages and credit products, largely offset by lower net revenues in interest rate products and significantly lower net revenues in commodities.
Previous wording
The decrease in FICC intermediation net revenues reflected significantly lower client activity (as activity in the prior year benefited from volatility in the macroeconomic environment). The following provides information about our FICC intermediation net revenues by business, compared with results for 2022:
Current wording
The increase in FICC intermediation net revenues reflected the impact of improved market-making conditions on our inventory, partially offset by lower client activity. The following provides information about our FICC intermediation net revenues by business, compared with results for 2023:
Previous wording
•Net revenues in mortgages and credit products primarily reflected the impact of improved market-making conditions on our inventory.
Current wording
•Net revenues in currencies, mortgages and credit products reflected the impact of improved market-making conditions on our inventory.
Previous wording
•Net revenues in currencies, commodities and interest rate products primarily reflected lower client activity.
Current wording
•Net revenues in interest rate products and commodities primarily reflected lower client activity.
Previous wording
Net revenues in Equities were $11.55 billion, 5% higher than 2022, due to higher net revenues in Equities financing (reflecting significantly higher net revenues in prime financing), partially offset by slightly lower net revenues in Equities intermediation (reflecting lower net revenues in cash products).
Current wording
Net revenues in Equities were $13.43 billion, 16% higher than 2023, reflecting significantly higher net revenues in Equities intermediation, primarily driven by derivatives, and higher net revenues in Equities financing, driven by prime financing.
Previous wording
Provision for credit losses was $401 million for 2023, compared with $468 million for 2022. Provisions for 2023 primarily reflected net provisions related to the commercial real estate portfolio. Provisions for 2022 primarily reflected the impact of broad macroeconomic and geopolitical concerns.
Current wording
Provision for credit losses was $40 million for 2024, compared with $401 million for 2023. Provisions for 2023 primarily reflected net provisions related to the commercial real estate portfolio.
Previous wording
We also provide tailored wealth advisory services to clients across the wealth spectrum. We operate globally, serving individuals, families, family offices, and foundations and endowments. Our relationships are established directly or introduced through companies that sponsor financial wellness or financial planning programs for their employees, as well as through corporate referrals. During 2023, we sold our Personal Financial Management (PFM) business.
Current wording
We also provide tailored wealth advisory services, primarily to ultra-high-net worth clients. We operate globally, serving individuals, families, family offices, and foundations and endowments. Our relationships are established directly or introduced through companies that sponsor financial wellness or financial planning programs for their employees, as well as through corporate referrals.
Previous wording
We offer personalized financial planning to individuals and also provide customized investment advisory solutions, and offer structuring and execution capabilities in securities and derivative products across all major global markets. In addition, we offer clients a full range of private banking services, including a variety of deposit alternatives and loans that our clients use to finance investments in both financial and nonfinancial assets, bridge cash flow timing gaps or provide liquidity and flexibility for other needs.
Current wording
We offer personalized financial planning to individuals and also provide customized investment advisory solutions, and offer structuring and execution capabilities in securities and derivative products across all major global markets. In addition, we offer clients a full range of private banking services, including a variety of deposit alternatives and loans that our clients use to finance investments in both financial and nonfinancial assets, bridge cash flow timing gaps or provide liquidity and flexibility for other needs. We also raise deposits from consumers through Marcus.
Previous wording
•Private banking and lending. Our private banking and lending activities include issuing loans to our wealth management clients. We also accept deposits from wealth management clients, including through Marcus. We also issued unsecured loans to consumers through Marcus. During the first half of 2023, we completed the sale of substantially all of this portfolio. Additionally, we provide investing services through Marcus Invest to U.S. customers. Private banking and lending revenues include net interest income allocated to deposits and net interest income earned on loans to individual clients.
Current wording
•Private banking and lending. Our private banking and lending activities include issuing loans to our wealth management clients. Such loans are generally secured by commercial and residential real estate, securities or other assets. We also raise deposits from wealth management clients, including through Marcus. Private banking and lending revenues include net interest income allocated to deposits and net interest income earned on loans to individual clients.
Previous wording
The average Asset & Wealth Management gross loans were $51.98 billion for 2023 and $59.35 billion for 2022.
Current wording
The average Asset & Wealth Management gross loans were$45.84 billion for 2024 and$51.98 billion for 2023.
Previous wording
Our target is to achieve annual firmwide management and other fees of more than $10 billion in 2024. This includes more than $2 billion from alternatives, which was surpassed in 2023.
Current wording
In 2024, we surpassed our target to achieve annual firmwide management and other fees of more than $10 billion, including more than $2 billion from alternatives.
Previous wording
Our target is to achieve pre-tax margins in the mid-twenties and ROE in the mid-teens within the medium term (three to five year time horizon from year-end 2022) for Asset & Wealth Management.
Current wording
In 2024, we achieved our target of pre-tax margins in the mid-twenties for Asset & Wealth Management. We also have a target to achieve ROE in the mid-teens within the medium term (three to five year time horizon from year-end 2022) for Asset & Wealth Management. The pre-tax margin for Asset & Wealth Management was 28% for 2024, including the positive impact of 4 percentage points from the results of historical principal investments.
Previous wording
Operating Environment. During 2023, Asset & Wealth Management operated in an environment generally characterized by continued broad macroeconomic concerns, including pressure in the commercial real estate market. However, improvements in the outlook for economic conditions contributed to generally higher global equity and bond prices compared with the end of 2022, positively affecting assets under supervision.
Current wording
Operating Environment. During 2024, Asset & Wealth Management operated in an environment generally characterized by continued broad macroeconomic concerns, including persistent concerns about the commercial real estate market. However, global equity prices were generally higher compared with the end of 2023, positively affecting assets under supervision.
Previous wording
2023 versus 2022. Net revenues in Asset & Wealth Management were $13.88 billion for 2023, 4% higher than 2022, reflecting higher Management and other feesand higher net revenues in Debt investments and Private banking and lending, partially offset by significantly lower net revenues in Equity investments and significantly lower Incentive fees.
Current wording
2024 versus 2023. Net revenues in Asset & Wealth Management were $16.14 billion for 2024, 16% higher than 2023, primarily reflecting significantly higher net revenues in Equity investments and higher Management and other fees. In addition, net revenues in Private banking and lending and Incentive fees were higher, while net revenues in Debt investments were lower.
Previous wording
The increase in Management and other fees primarily reflected the impact of higher average assets under supervision, including the impact of acquiring NNIP. The increase in Debt investments net revenues reflected significantly lower net mark-downs compared with the prior year (despite a challenging environment for real estate investments in the current year), partially offset by lower net interest income due to a reduction in the debt investments balance sheet. The increase in Private banking and lending net revenues primarily reflected higher deposit spreads and balances, partially offset by the impact of the sale of substantially all of the Marcus loans portfolio in the year. The decrease in Equity investments net revenues reflected significantly lower net gains from investments in private equities, primarily due to net losses from real estate investments, partially offset by significantly lower net losses from investments in public equities. The decrease in Incentive fees was driven by more significant harvesting in the prior year.
Current wording
The increase in Equity investments net revenues primarily reflected significantly higher net gains from investments in private equities (largely reflecting the impact of net losses in real estate investments in the prior year). The increase in Management and other fees primarily reflected the impact of higher average assets under supervision. The increase in Private banking and lending net revenues primarily reflected the impact of the sale of the Marcus loan portfolio in 2023 (including net revenues of approximately $(370) million related to the sale of substantially all of the portfolio) and the impact of higher direct-to-consumer deposit balances. The increase in Incentive fees was driven by harvesting. The decrease in Debt investments net revenues reflected lower net interest income due to a reduction in the debt investments balance sheet, partially offset by net gains in the current year compared with net losses (particularly in real estate investments) in the prior year.
Previous wording
Provision for credit losses was a net benefit of $508 million for 2023, compared with a provision of $519 million for 2022. The net benefit for 2023 primarily reflecteda reserve reduction of $442 million related to the sale of substantially all of the Marcus loans portfolio and lower balances in corporate loans due to sales and paydowns, partially offset by impairments. Provisions for 2022 primarily reflected the impact of macroeconomic and geopolitical concerns.
Current wording
Provision for credit losses was a net benefit of $232 million for 2024, compared with a net benefit of $508 million for 2023. The net benefit for 2024 reflected a net benefit related to the wholesale portfolio (driven by paydowns). The net benefit for 2023 primarily reflected reserve reductions related to the sale of substantially all of the Marcus loan portfolio and lower balances in corporate loans, partially offset by impairments.
Previous wording
We earn management fees on client assets that we manage and also receive incentive fees based on a percentage of a fund’s or a separately managed account’s return, or when the return exceeds a specified benchmark or other performance targets. These incentive fees are recognized when it is probable that a significant reversal of such fees will not occur. Our estimated unrecognized incentive fees were $3.77 billion as of December 2023, $3.33 billion as of December 2022 and $3.39 billion as of December 2021. Such amounts are based on the completion of the funds’ financial statements, which is generally one quarter in arrears. These fees will be recognized, assuming no decline in fair value, if and when it is probable that a significant reversal of such fees will not occur, which is generally when such fees are no longer subject to fluctuations in the market value of the assets.
Current wording
We earn management fees on client assets that we manage and also receive incentive fees based on a percentage of a fund’s or a separately managed account’s return, or when the return exceeds a specified benchmark or other performance targets. These incentive fees are recognized when it is probable that a significant reversal of such fees will not occur. Our estimated unrecognized incentive fees were $4.12 billion as of December 2024 and $3.77 billion as of December 2023. Such amounts are based on the completion of the funds’ financial statements, which is generally one quarter in arrears. These fees will be recognized, assuming no decline in fair value, if and when it is probable that a significant reversal of such fees will not occur, which is generally when such fees are no longer subject to fluctuations in the market value of the assets.
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Current report — wording carried from elsewhere
We expect our 2025 annual effective tax rate to be approximately 21%.
Current report — wording carried from elsewhere
See Note 13 to the consolidated financial statements for further information about our deposits, including a maturity profile of our time deposits.
Current report — wording carried from elsewhere
•Third-party risk, including vendor risk;
Current report — wording carried from elsewhere
The Firmwide Technology Risk Committee is responsible for reviewing matters related to the design, development, deployment and use of technology. This committee oversees cybersecurity matters, as well as technology risk management frameworks and methodologies, and monitors their effectiveness. This committee is co-chaired by our CISO and our chief technology officer, and reports to the Firmwide Enterprise Risk Committee. To assist the Firmwide Technology Risk Committee in carrying out its mandate, the Firmwide Artificial Intelligence Risk and Controls Committee, which oversees risks associated with the use of AI, reports to the Firmwide Technology Risk Committee. See “Overview and Structure of Risk Management” for further information about this committee.
Rearranged previous paragraphs (2)
Previous report — wording carried elsewhere
The table below presents the commercial real estate investments in Asset & Wealth Management that we hold on our balance sheet.
Previous report — wording carried elsewhere
The following are the primary committees and steering groups that oversee our Cybersecurity Program: