October 17, 2013 / 12:26 PM / 4 years ago

CORRECTED-Goldman Sachs trims commodity risk

(Deletes "FICC net revenues up" from headline; FICC net revenues fell from a
year earlier)
    Oct 17 (Reuters) - Goldman Sachs trimmed its commodity trading risk in the
third quarter from the previous three months, the bank reported on Thursday,
though revenues improved from a year earlier.
    Value-at-Risk (VaR) in commodities stood at $17 million in the third
quarter, down from $19 million in the second quarter and $22 million in the
third quarter of 2012.
    The bank said that while net revenues in its Fixed Income, Currencies and
Commodities (FICC) business were down 44 percent compared with the same period
last year at $1.25 billion, commodities were one of the few bright spots.
    "Fixed Income, Currency and Commodities operated in a challenging
environment, which was characterized by economic uncertainty, difficult
market-making conditions in certain businesses, and lower levels of activity,"
the bank said.
    "Net revenues in commodities were higher compared with the third quarter of
    Goldman, typical of Wall Street banks, groups its commodities revenue under
the fixed income category in its quarterly earnings and does not break down the
sector individually, often leaving VaR as one of its key risk-reward indicators
for commodities.
    The bank as a whole reported a slight fall in quarterly profit as weak
bond-trading volumes hit revenue in the Wall Street bank's biggest business.

                              ------2013------    ------2012-------   --2011--
                              Q3     Q2     Q1    Q4   Q3   Q2   Q1   Q4    Q3  

 * JPMorgan            13    13     15    14   13    13   21   20   15  
 * Goldman Sachs        17    19     21    20   22    20   26   26   25  
 * Morgan Stanley      n/a    24     20    22   22    27   27   28   32  

 (Reporting by David Sheppard in London; Editing by John Wallace)
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