Goldman Sachs lowers quarterly earnings primarily based on authorities laws

© Reuters. FILE PHOTO: The Goldman Sachs logo is displayed on a post above the floor of the New York Stock Exchange

By Elizabeth Dilts Marshall

NEW YORK (Reuters) – Goldman Sachs Group Inc (NYSE 🙂 lowered its previously reported quarterly earnings on Friday as the bank provided more money to settle the settlement with the Malaysian government over the billion-dollar 1MDB scandal.

Goldman reduced its common shareholders' net profit from $ 2.25 billion to $ 197 million. This was released on Friday.

Revised earnings reflect a higher than previously announced provision for legal and administrative expenses resulting from the bank's $ 3.9 billion agreement with the Malaysian government.

The bank announced that it had provided $ 2.96 billion in legal and regulatory expenses in the second quarter, compared to $ 945 million that Goldman had provided on July 15 during the second quarter earnings release.

The bank's stock fell 0.1% in pre-market trading.

On July 24, Goldman agreed to pay the Malaysian government $ 2.5 billion in cash and to repay at least $ 1.4 billion in proceeds from 1Malaysia Development Bhd (1MDB) sovereign wealth assets in exchange for that Malaysia dropped all charges against the bank.

The U.S. and Malaysian authorities estimate that $ 4.5 billion was stolen from the fund between 2009 and 2014. Goldman helped the fund raise $ 6.5 billion for two bond offerings and earned $ 600 million in fees, according to the U.S. Department of Justice.

Goldman is facing a separate DOJ investigation that is reported to be investigating whether the bank has violated U.S. foreign corruption law laws that prevent U.S. companies from seeking foreign government officials for help in obtaining or maintaining To pay business.

While it remains unclear whether the bank's reserves could cover a different comparison, the DOJ has pledged in recent years to take parallel comparisons into account when calculating corporate penalties. A source told Reuters in December that Goldman was in talks with U.S. officials to potentially pay up to $ 2 billion to resolve the investigation.

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