New York-based banking giant Goldman Sachs announced Monday that it earned $1.81 billion in net profit for the first quarter of this year. This translates to earnings per share of $3.39, far exceeding analysts’ forecast of $1.33 per share.

Aside from its impressive first quarter gains, the bank also said that it plans to raise $5 billion by putting common stock on the market to pay off the $10 billion government bailout fund it received.

Coming hot on the heels of Wells Fargo’s reported $3 billion 1st quarter results which boosted a stock rally last Thursday, the Goldman Sachs’ announcement which came after the close of regular trading, elicited only a lukewarm reaction from investors. Goldman price per share initially rose following the statement but was unable to sustain and slipped back down by 1.5%.

Citigroup and Bank of America stocks on the other hand, which both surged during regular trading to 25% and 15%, rose after the Goldman report but only by a mere 1% and 0.7% respectively.

Financial experts have credited Goldman’s strong showing to its traditional investment banking and trading operations, as opposed to banks like Citigroup and Bank of America which focus more on retail banking.

With plans to raise $5 billion from public stock offering, investment-turned-bank-holding-company Goldman Sachs also revealed in a separate statement that it hopes to repay its $10 billion allocation from the federal government’s TARP funds within the year. Government restrictions on bailed out banks have gotten tougher, prompting several banks including Goldman to opt for quick repayment of the funds so as to be free of government conditions that could affect the bank’s management.

Now that both Wells Fargo and Goldman Sachs have posted huge improvements from the previous quarter’s dismal results (net loss of $2.73 billion for Wells and net loss of $2.12 billion for Goldman), people have again gotten into thinking that banks in general may well be on the road to recovery.

Other big banks like JP Morgan Chase, Citigroup, and Bank of America have yet to report their 1st quarter performance, and many are keeping their fingers crossed, hoping to have the momentum sustained.

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