GOLDMAN SACHS GROUP INC Annual Report, Year Ended Dec 31, 2012

Goldman Sachs Group, Inc. reported a strong financial performance for the fiscal year ended December 30, 2012, with net earnings of $7.48 billion and diluted earnings per share of $14.13, a significant increase from $4.44 billion and $4.51 per share in 2011. The firm's return on average common shareholders' equity improved to 10.7% from 3.7% in the prior year, reflecting a generally improved business environment characterized by tighter credit spreads and higher global equity prices, despite ongoing concerns about the global economy and political uncertainties. The firm repurchased $4.64 billion of its common stock and maintained robust capital ratios, with a Tier 1 capital ratio of 16.7% and a Tier 1 common ratio of 14.5% as of December 2012. Net revenues increased by 19% to $34.16 billion, driven by significant growth in Investing & Lending and higher net revenues across all other segments. Investment Banking saw increased revenues, primarily from debt underwriting, while Institutional Client Services benefited from strong mortgage-related revenues. Investment Management experienced higher incentive fees, contributing to overall revenue growth. The firm also made progress on expense management initiatives, with total operating expenses remaining stable year-over-year, despite a 6% increase in compensation and benefits driven by higher revenues.