Goldman traders help fuel firm's 45% profit jump

financialpost.com:

Goldman Sachs Group Inc. profit soared 45 per cent in the third quarter on a surprise increase in equity-trading revenue and a resurgent investment-banking business.

The firm’s stock traders recorded their best quarter in more than three years, on track for their best year ever, while dealmakers pocketed fees that exceeded estimates across every key business line. The investment bank’s gains were tempered by a slide the firm had previously telegraphed in fixed-income trading.

Investors have been sending Goldman shares higher this year as the bank abandons major parts of its consumer-banking push and positions itself to benefit from a rebound in investment banking. Across Wall Street, big banks are showing they can fend off headwinds in their retail businesses from the reduction ininterest rates, while highlighting the potential for increased dealmaking that would lift fees across the industry.

Goldman shares have posted the biggest gain among the top U.S. banks this year, advancing 36 per cent, and they reached an all-time high on Monday. The stock jumped 3.3 per cent at 8:03 a.m. in early New York trading.

The bank’s results included a US$415 million hit tied to severing the firm’s credit-card partnership with General Motors Co. and jettisoning other small retail ventures. Barclays Plc said Monday it’s taking over the GM business after Goldman fumbled its foray into consumer lending.

The Wall Street firm has spent much of the last year trying to drop its much bigger card tie-up with Apple Inc. That book of business, which has about US$17 billion in outstanding balances, could suffer a steeper hit if Goldman exits the partnership by selling the loans at a discount.

Chief executive David Solomon last month flagged a