Bottom Line: Goldman is back on top in London as well

Elizabeth Fournier

NOT everything was rosy for Goldman yesterday. Even as the bank revealed in its quarterly update that profits had more than doubled, its shares were falling in early trading as investors ran scared that the forecast-beating performance would be a one-off.

What they’re most concerned about are capital rules, a question left hanging by Goldman yesterday despite recent threats from US regulators that US banks could be forced to hold bigger buffers. But while Blankfein is keeping quiet on capital, he’s more than happy to shout about Goldman’s investment bank (IB) performance, which saw it top global M&A rankings as revenues rose by 29 per cent from last year.

Though Goldman didn’t break down its performance by geography in its quarterly update yesterday, industry rankings suggest that the UK arm of the bank is looking good. According to recent figures from Dealogic, the bank moved up in every single UK investment banking sector, lagging behind only JP Morgan in overall market share and making a huge leap from last year’s fifth place.

Goldman predictably moved back into first place in UK mergers and acquisitions, topping the ranking for the first time for two years, but it’s in the equity capital markets that the UK unit really impressed, soaring from 20th to second place in the ranking and grabbing close to 10 per cent of market share.

Just 18 per cent of total headcount are based in London, but IB revenues for the UK are estimated at $157m – more than 10 per cent of the global total revealed yesterday.

There may be clouds gathering over Blankfein’s head as US regulators choose their path, but in London at least the sun is definitely shining.