Goldman Sachs leads a $22bn equity trading quarter at the six biggest US banks
Wall Street's six largest banks booked a combined $22bn in third-quarter equity trading revenue, City AM reported. Goldman Sachs led with a 72% rise to $6.4bn on volatility and hedge-fund borrowing, and its chief executive says the peak is hard to call.
The Board Room · Leadership desk
Goldman Sachs and Morgan Stanley together booked $12.2bn of third-quarter equity trading revenue. The other four banks shared about $9.8bn. Goldman Sachs alone booked $6.4bn, up 72% on the year, leading the six banks.
| Figure | Value | Note | Claim |
|---|---|---|---|
| Goldman and Morgan Stanley, equity trading combined | $12.2bn | 18 | |
| Other four banks, about | $9.8bn | 20 | |
| Goldman Sachs equity trading | $6.4bn | led the six banks, up 72% on the year | 2 |
What happened
- Morgan Stanley took second place with $5.8bn, up 41%.
- Prime balances, the money and assets banks hold for hedge funds, grew by double digits at Goldman and Bank of America and by more than 40% at Citi.
- Dealmaking cooled in the same quarter: Goldman's investment bank fees slipped 5% from the previous quarter to $3.2bn.
- Group revenue for the six banks was $165.6bn, down 6.7% from the previous quarter.
Why it matters
- exposure A slowdown at Goldman or Morgan Stanley would move the group total more than the other four banks could offset.
- decision Risk committees must decide how much more balance sheet to give hedge-fund financing at today's demand. More lifts this quarter's revenue, and next quarter carries the balances if volatility fades.
- precedent IG's Chris Beauchamp reads US lending strength as good news for Lloyds and NatWest, and a Goldman dealmaking beat as some comfort for Barclays. UK results will test one analyst's read-across.
Two banks supplied most of the total. Goldman's $6.4bn [2] and Morgan Stanley's $5.8bn [3] come to $12.2bn [18], about 55% of the $22bn [1][19]. JPMorgan, Bank of America, Citigroup and Wells Fargo shared the remaining $9.8bn [20]. Working back from Goldman's annual growth rate, it earned roughly $3.7bn a year earlier [21], so it added about $2.7bn on its own [22].
City AM ties the volatility to the war in Iran and swinging AI stocks [24]. The other driver was borrowing. Trading desks gained from a surge in prime brokerage and portfolio refinancing as hedge funds took on more cash to make bigger bets across sectors and stock markets [4]. We think the two sources behave differently: financing balances can be carried for months, while volatility has to keep arriving. City AM's account does not say how much of the $22bn came from each.
The skeptic's question is whether this is the peak. "I know everybody wants to call the peak. It's hard to call the peak," Goldman boss David Solomon told investors after the bank's earnings report [6]. He added: "I still think for capital markets activity, it's a top quartile environment" [7]. A top-quartile level describes where activity sits today. Direction is a separate question, and JPMorgan's Jamie Dimon spoke to it for dealmaking, saying "activity did moderate somewhat in the quarter" [9].
The figures also sit on different bases. Goldman's 72% is annual growth [2], while its 5% fall in investment bank fees is measured against the previous quarter [8], as is the fall in group revenue [10].
Lending income gives the banks a second support. Net interest income grew across the board except for a 2% dip at Goldman [11], after the Federal Reserve raised rates last month to a range of 3.75% to 4% on inflation pressure tied to the US-Iran war [12]. Chris Beauchamp, chief market analyst at IG, told City AM that the "shared positive" across US bank earnings was that "higher rates keep powering lending income" [13].
UK bank results arrive in a set order. Barclays reports on 22 October [15], six days before Chancellor John Healey delivers his first Budget on 28 October [16][23]. Dimon has cautioned of "adverse consequences" if taxes on the sector are raised [17].
What to watch
- Barclays' investment bank result, the first UK check on whether Goldman's dealmaking beat carries over.
- Whether the Budget treats banks as a tax target, given Dimon's warning of adverse consequences.
- Next quarter's prime balances and Goldman's investment bank fees: does hedge-fund borrowing hold, and does dealmaking recover?
Clarity's read
What the record supports and how the coverage leans. The claims behind it follow.
Reality
- Evidence45
- Adoption
- Insufficient
- Hype gap+10
- Incentives
- Insufficient
- Confidence50
Claim ledger
Ranked by verification strength, evidence, and original report placement.
- [1]
Equity trading divisions at JPMorgan, Goldman Sachs, Morgan Stanley, Bank of America, Citigroup and Wells Fargo generated a combined $22bn in revenue in the third quarter.
- [2]
Goldman Sachs led the six banks with 72 per cent annual growth in equity trading revenue to $6.4bn.
- [3]
Morgan Stanley took second place with $5.8bn in equity trading revenue after a 41 per cent jump.
- [4]
Trading desks benefited from a surge in prime brokerage and portfolio refinancing, as hedge funds borrowed more cash to make bigger bets across different sectors and stock markets.
- [5]
Goldman and Bank of America reported double-digit growth in prime balances, the money and assets banks hold for hedge funds, while Citi recorded more than a 40 per cent increase.
- [6]
"I know everybody wants to call the peak. It's hard to call the peak," Goldman boss David Solomon told investors following the bank's earnings report.
- [7]
"I still think for capital markets activity, it's a top quartile environment", Solomon said.
- [8]
Goldman's investment bank fees slipped five per cent to $3.2bn compared with the previous quarter.
- [9]
JPMorgan chief Jamie Dimon said "activity did moderate somewhat in the quarter".
- [10]
Total revenue for the six banks came in at $165.6bn, a fall of 6.7 per cent from the previous quarter's haul.
- [11]
Net interest income grew across the board except for a two per cent dip at Goldman Sachs.
- [12]
The Federal Reserve raised interest rates last month to a range of 3.75 to 4 per cent after inflationary pressures ramped up due to the US-Iran war.
- [13]
Chris Beauchamp, chief market analyst at IG, told City AM the "shared positive" across US bank earnings was that "higher rates keep powering lending income".
- [14]
Beauchamp said the boost to US lending income signalled good news for Lloyds and NatWest, and that Goldman's dealmaking beat offers "some comfort" for Barclays' investment bank.
- [15]
Barclays will kick off the UK banks reporting season on 22 October.
- [16]
Chancellor John Healey delivers his first Budget on 28 October.
- [17]
Dimon cautioned of "adverse consequences" if taxes are raised on the sector.
- [18]
Goldman and Morgan Stanley together booked $12.2bn of equity trading revenue.
- [19]
Goldman and Morgan Stanley account for about 55% of the six-bank equity trading total.
- [20]
The other four banks shared about $9.8bn of equity trading revenue.
- [21]
Goldman's implied year-earlier equity trading revenue was roughly $3.7bn.
- [22]
Goldman's implied annual gain in equity trading revenue was about $2.7bn.
- [23]
Barclays' reporting date falls six days before the Budget.
- [24]
City AM attributes the trading gains to volatility triggered by the war in Iran and swinging AI stocks.
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Sources
1 independent publisher whose own reporting we read for this story.
- cityam.com‘It’s hard to call the peak’: Wall Street banks land $22bn trading haul
1 article · October 14, 2026
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