Aside from the slight embarrassment of having to ask syndicate members on its own secondary offering to return some of the fees, Goldman Sachs's equity franchise is back on track. Having backed the e-retail sector to the hilt from 1998 to early 2000, Goldman could do nothing but watch as its aftermarket performance figures plummeted in the US, and then Europe and Asia.
Fears that this was the beginning of the end for Goldman's equity franchise proved unfounded, however, and in a more challenging environment it has once again proved the value of its services. "The last six months have shown that breadth and balance are the keys to a successful franchise," says global co-head of equities Mark Tercek. "We're seeing issuance from energy and power companies which had been very quiet for years, as well as from other sectors such as Reits [real estate investment trusts] and general industrial. And we're strong in these areas as well."
The stock market crash has all but silenced the one investor base that Goldman didn't cover internally - retail - and that had a disproportionately high level of influence in how stocks traded over the past few years.