From Goldman Sachs’ 2024 shareholder letter:

When times are better, it is easy for institutions to lose sight of the importance of remaining focused on running their operations in a disciplined and more efficient manner. In 2024, we launched a three-year program to optimize our organizational footprint, better manage our non-compensation expenses, and increase automation — and ultimately productivity — including through the use of artificial intelligence solutions.

Today, many of our people have access to generative AI-powered tools to help them be more efficient and increase productivity. These include a developer copilot coding assistant, our natural-language GS AI assistant, and other use cases we are developing across GBM and AWM.

Throughout 2025, we intend to continue increasing the use of these tools in day-to-day workflows. These efficiencies will allow us to further invest for growth and improve the client experience over time.

Looking Ahead: A Dynamic Environment

Financial market participants continue to recognize the competitiveness of the U.S. economy and the opportunities for sustained growth. But as we have seen in recent weeks, the environment can shift quickly. Global growth has been hampered by inflation, an escalation in potential tariffs, and the toll of geopolitical tensions and prolonged conflicts across multiple regions.

Growth in Europe continues to lag behind the United States. When we speak with leaders from the region, we hear a renewed sense of urgency to unlock the forces of dynamism and innovation. My hope is that Europe’s leaders have the public support and political will to make the necessary structural reforms to increase growth.

Over the past year, when I would talk with CEOs, almost all of them felt burdened by the regulatory impact on their business. Following the results of the U.S. election last year, however, there was a meaningful shift in CEO sentiment, particularly in America. Given the expected change in the regulatory environment, the appetite for deal-making has increased, and that could spur further capital markets activity in 2025. The United States remains the most important growth engine for the global economy, with the most dynamic and innovative global businesses, fueled by the most liquid capital markets in the world. At the same time, though 2025 began with a lot of optimism, the environment is complex. The ultimate direction of various policy items in the U.S. remains unclear. I expect that there will be many aspects that are supportive of growth, and others that could be less so. The discussion around tariffs in particular may weigh on corporate sentiment, and the impact on bottom lines could be significant.

More broadly, the new administration in the U.S. has started with a burst of activity, which has a wide range of potential policy outcomes. While policy uncertainty is to be expected within the first few months of any administration, it’s important that policy positions become clearer so that businesses are able to make the decisions they need for longer-term planning and investment. Many CEOs I engage with are evaluating the potential impact on their top and bottom lines, and as a result, we are seeing some of our corporate clients acting more cautiously until they have more clarity.

Whatever the future holds, I am very confident about the trajectory of Goldman Sachs. We are ready to continue serving our clients and drive stronger returns for shareholders, as we execute with a relentless emphasis on client service, partnership, integrity and excellence.

The full letter and annual report can be read here 

Source: Goldman Sachs