It’s Goldman Sachs time again, which means more about fixed income, currencies and commodities (FICC).
This week it was the turn of none other than CEO Lloyd Blankfein to weigh into the continuing debate about his firm’s FICC franchise at a Credit Suisse financial services conference in Florida.
Lloyd certainly knows how to warm up a first-session conference crowd: he recognised a lot of faces that were, in his words, if not friendly then at least familiar.
Then he was down to business – and keen to set the record straight. There had been attention paid to Goldman’s FICC unit over the last year, and this was appropriate given its performance.
But there were two issues that he thought were often conflated. He wanted to untangle them – although, given his conclusion, it wasn’t terribly clear why.
The first was the scale of resources that Goldman commits to its FICC franchise. The second was the performance of that franchise in the context of that commitment. It seemed very important to him that these were two distinct things.
In short, Goldman had cut hugely the resource allocated to that business over the past five years, and the fall in revenues needed to be looked at in the context of that.
