The numbers were flattered by a $1.9bn accounting gain, but stripping out the technical change, revenues were down versus the same quarter last year by 16.4 per cent to $4.47bn.
Fees for advisory work in the investment bank and fixed income were worst hit, with top line income down 31 per cent and 34 per cent in each division on the same period last year.
Compensation costs also fell versus last year, but not by the same proportion. The investment bank’s compensation-to-income ratio fell from 38 per cent to 29 per cent, meaning that it spent $1.85bn on rewarding staff – nine per cent down on the previous year.
Investment banks have faced increasingly tough conditions as volatile markets have put investors off trading and striking large deals.
Overall, the bank saw revenues drop by $1.9bn on last year, excluding the accounting gain, to $22.5bn for the third quarter of 2011.
Revenues in the bank’s retail division received a boost, however, rising $721m to $7.5bn. However, it lost half a million on its private equity investments.
The bank also bought back $4.4bn of its stock over the third quarter in an attempt to placate investors, but its share price yesterday dropped 4.8 per cent.