This summary is based on the first quarter fiscal 2008 earnings call conducted by The Goldman Sachs Group, Inc. (GS: chart) on March 18, 2008.

Management:

Executive Vice President & CFO: David Viniar
Director Investor Relations: Dane Holmes

Key Investors Issues

- EPS were $3.23 a share compared to $6.67 a share last year.
- Net earnings were $1.51 billion compared to $3.2 billion in the year-ago period.
- Total net revenue dropped to $8.33 billion from $12.73 billion last year.

First Quarter Highlights

Net revenues were $8.3 billion, net earnings were $1.5 billion and earnings per share were $3.23.

Annualized return on common equity was 15%.

- Investment Banking produced net revenues of $1.2 billion.
- Advisory revenues were $663 million, down 47% sequentially as the pace of closed M&A transactions slowed meaningfully.

- Investment banking activity has clearly been influenced by broader market disruptions and the unclear economic outlook. The strength of client franchise in investment banking remains undiminished as the company ranks first in global announced M&A for the fiscal year to date.

Investment Banking backlog declined from the fourth quarter but it is still comparable to 2006 levels.

- The company advised on a number of important transactions that closed during the quarter including Siemans Automotive’s ˆ 11.4 billion euro sale for Continental, Abu Dhabi National Energy’s $4.6 billion acquisition of PrimeWest Energy Trust.
- The company is advising on a number of announced transactions including Ingersoll-Rand’s $11.5 billion acquisition of Train, the Vivendi Universal Games $6.5 billion merger with Activision and Ranstad Holdings ˆ 3.4 billion euro acquisition.

Underwriting revenues were $509 million, 31% below the fourth quarter.

- Equity underwriting revenues were $172 million, down 57% sequentially while debt Underwriting revenues were up 2% from the fourth quarter to $337 million.
- Equity financing activity declined due to sharp price reductions, higher volatility and increased uncertainty in global equity markets.
- Debt underwriting activity was relatively flat sequentially as broader credit market disruption continued to weigh on new issue markets.
- The company participated in a number of underwriting transactions including the $6.6 billion three part convertible notes offering by TransOcean, the $4.2 billion convertible bond offering by Signopak, and the £ 318 million IPL by Hanson Transmissions.

Trading and Principal Investments includes FICC, equities and principal investments.

- Net revenues were $5.1 billion, down 26% from the fourth quarter.
- FICC net revenues were $3.1 billion, down 5% from the fourth quarter.
- The company posted excellent results across macro businesses, with record quarters in currencies and rates and while not a record strong revenues in commodities.

Currencies rates and commodities all benefited from higher volatility and increased customer activity.

- Credit revenues were down from the fourth quarter as considerable client trading flow was more than offset by a broad decline in asset values.
- Credit results included at $1 billion loss, $1.4 billion before hedges, related to leverage lending activities.
- Mortgages revenues declined. Market dislocation that began in the sub-prime asset class migrated to various assets including prime, Alt-A and commercial real estate. Much of the pricing pressure seen is related to technical contagion and many assets are being priced by the market at levels which are below the levels that would stem from a fundamental valuation approach. The company believes in the mark-to-market philosophy and continues to mark positions to market clearing levels. As a result the company had losses of approximately $1 billion on resident mortgage positions, largely in Alt-A and prime. As it relates to commercial real estate, net losses were not material.

Equities net revenues were $2.5 billion, down 3% from the fourth quarter.

- Equities trading net revenues declined 5% to $1.3 billion.
- Derivatives business was up sequentially driven by higher customer activity and increased equity market volatility.
- Revenues from cash equities business were solid but down from the fourth quarter which principal strategies results were down significantly.