Goldman Sachs Group Inc at Goldman Sachs U.S. Financial Services Conference Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Richard Ramsden - Goldman Sachs & Company, Inc. - Analyst : Why don't we start with just a broad discussion around how you're thinking about the macroeconomic backdrop, both here but globally to the extent that you want to talk about it? And maybe talk a little bit about how the election result from just over a month ago plays into how you're thinking about the macroeconomic outlook for next year.

Question: Richard Ramsden - Goldman Sachs & Company, Inc. - Analyst : So maybe we can talk about the outlook for capital markets specifically, maybe we can start with M&A. Now the election is behind us, have you seen a significant change either in pipelines, client dialogue, or activity? And has the election in any way changed your view of the outlook on the M&A market heading into next year? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. DECEMBER 10, 2024 / 3:00PM, GS.N - Goldman Sachs Group Inc at Goldman Sachs U.S. Financial Services Conference

Question: Richard Ramsden - Goldman Sachs & Company, Inc. - Analyst : So you mentioned financial sponsors. So maybe we could just follow up on that specifically. Because if we look back over time, I think you take 2021, sponsors represented about 40% of announced transactions. It's obviously well below that level today. Are you seeing momentum in that part of the M&A market specifically as well? And what do you think has been holding that market up? And do you think the pieces are in place for that to recover in '25?

Question: Richard Ramsden - Goldman Sachs & Company, Inc. - Analyst : And then you did mention briefly ECM and IPO activity. That's obviously lagged as well. You mentioned sponsor IPO activity potentially picking up. But just more broadly, what are you expecting in terms of IPO activity? And do you think that the ECM market could normalize relative to historical averages next year?

Question: Richard Ramsden - Goldman Sachs & Company, Inc. - Analyst : Okay. So let's talk about the longer-term outlook for Goldman. Maybe we can just start off with a discussion about your strategic priorities, the strategic focus heading into next year. And maybe talk a little bit about the key drivers that you think will get the firm to the financial targets that you've set out.

Question: Richard Ramsden - Goldman Sachs & Company, Inc. - Analyst : Okay. So let's talk about the businesses. Maybe let's start off with Global Banking and Markets. If we think about the trading businesses, FICC and Equities, they're still running significantly ahead of where we were at pre-COVID. I mean, if you look at the FICC and Equity run rate, both for the firm but also for the industry, they're 20% to 30% ahead of where they were in 2019. Can you talk about the sustainability of revenues in those businesses? And where do you see the best opportunities for growth in those businesses for Goldman, just given the very high levels of market share that we now have?

Question: Richard Ramsden - Goldman Sachs & Company, Inc. - Analyst : And then just as a follow-up, maybe you can spend a couple of minutes talking about the financing businesses, which sit within FICC and Equities. That's obviously been an important source of growth in the last three years. Can you just remind us of what sits in those businesses, what the growth drivers are? And maybe talk about how we should think about the revenue trajectory for those businesses in a lower-rate environment.

Question: Richard Ramsden - Goldman Sachs & Company, Inc. - Analyst : Okay. So let's shift to Asset and Wealth Management. Maybe we can just start off with the strategic priorities for those businesses. And maybe talk a little bit about how you're performing relative to the targets that you set out a couple of years ago.

Question: Richard Ramsden - Goldman Sachs & Company, Inc. - Analyst : So in Wealth Management, in particular, where are you focused from a growth perspective? And I think it's fair to say everyone is focused on growing that business of your peers. So what do you think really differentiates Goldman when it comes to the Wealth Management piece of that?

Question: Richard Ramsden - Goldman Sachs & Company, Inc. - Analyst : So then in Alts, that business is clearly at scale. It's obviously a much, much larger business. But you have talked about that as still being an area of very attractive growth going forward. So maybe you can unpack a little bit where you see the best growth opportunities within the Alt business. And also similar to what you did with Wealth, talk about what differentiates us in the Alt business relative to alternative asset management, perhaps, also other banks with offerings?

Question: Richard Ramsden - Goldman Sachs & Company, Inc. - Analyst : Okay. So let's talk about private credit. It's a really important theme. I know we talked about this last year, but it's still very much, I think, top of investors' mind. So maybe you can talk about how Goldman is positioned to capture the opportunity in private credit, and also talk a little bit about our relative positioning in that market.

Question: Richard Ramsden - Goldman Sachs & Company, Inc. - Analyst : So let's shift to expenses and the outlook for operating leverage and efficiency improvements. I think broadly, maybe you can start off by talking about how you're balancing the need to invest in the business to drive some of the growth opportunities that you've talked about versus delivering near-term operating leverage. And then if you take a step back, how would you characterize the competitive dynamic or environment for talent today? It feels that everybody is prioritizing growth in the capital markets business. Are you seeing that show up in terms of just greater cost inflation, perhaps, than we saw 6 or 12 months ago? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. DECEMBER 10, 2024 / 3:00PM, GS.N - Goldman Sachs Group Inc at Goldman Sachs U.S. Financial Services Conference

Question: Richard Ramsden - Goldman Sachs & Company, Inc. - Analyst : Okay. So let's talk a little bit about capital. It feels like we've been talking about the Basel III endgame for at least two years, maybe even longer. What is your expectation around whether that's going to be finalized? Is it something you think should be finalized? And look, given the uncertainty around capital requirements for the industry is likely to persist at least into 2025, how are you thinking about managing the capital base for the firm, just given that uncertainty around what the requirements ultimately are going to be?

Question: Richard Ramsden - Goldman Sachs & Company, Inc. - Analyst : So we've got a couple of minutes left. So let me ask two other questions. The market clearly has got a very, very positive view on the outlook for next year. From a risk perspective, do you think the market is missing anything? What's top of mind for you today? And are there risks that you're focusing on more acutely today than, perhaps, three or six months ago?

Question: Richard Ramsden - Goldman Sachs & Company, Inc. - Analyst : Okay. So to wrap up, maybe you can conclude with the key messages you want investors to take away. And then I'm also curious -- and you spend a lot of time talking to investors -- what do you think is the most underappreciated part of the investment case for Goldman Sachs stock today, given where it's trading?

Question: Richard Ramsden - Goldman Sachs & Company, Inc. - Analyst : Okay. With that, thank you for joining us. Hopefully, see you next year. Thank you.

Question: Richard Ramsden - Goldman Sachs & Company, Inc. - Analyst : Thank you.