[R]9:15AM New York – Goldman Sachs revenues declined 35% and net income fell 53% from a year ago.[/R]

The Goldman Sachs Group, Inc. (GS: chart) today reported net revenues of $8.34 billion and net earnings of $1.51 billion in the first quarter ended February 29, 2008. Diluted earnings per common share were $3.23 compared with $6.67 for the first quarter of 2007 and $7.01 in the previous year. Net revenues declined 35% from a year ago and 22% from the fourth quarter of 2007.

Investment banking revenues declined 32% from the first quarter to $1.17 billion and 41% lower than the fourth quarter of 2007.

Financial advisory net revenues declined 23% from the first quarter of the previous year to $663 million. Underwriting net revenues declined 40% to $509 million, 40% from the first quarter of 2007, primarily due to significantly lower net revenues in debt underwriting.

The decline in debt underwriting was primarily due to a decrease in leveraged finance and mortgage-related activity, reflecting difficult market conditions.

Trading and principal investments revenue declined $5.12 billion in the first quarter of 2007 and 26% lower than the fourth quarter of 2007.

Net revenues in FICC (Fixed income Currencies and Commodities) were $3.14 billion, 32% lower than in the first quarter of 2007.

Net losses on residential mortgage loans and securities were approximately $1 billion. In addition, credit products included a loss of approximately $1 billion ($1.4 billion before hedges) related to non-investment-grade credit origination activities, as well as lower results from investments compared with the first quarter of 2007.

Equities related net revenue declined 19% to $2.51 billion but asset management net revenues increased 28% to$2.04 billion from a year ago and 11$ from the fourth quarter of 2007.

Asset management net revenues were $1.32 billion, 23% higher than the first quarter of 2007, reflecting higher management and other fees, and higher incentive fees. During the quarter, assets under management increased $5 billion to $873 billion, reflecting $29 billion of net inflows, partially offset by market depreciation of $24 billion. Net inflows reflected inflows in money market assets, partially offset by outflows in equity assets, and market depreciation was in equity assets.

Securities Services net revenues were $722 million, 38% higher than the first quarter of 2007, reflecting significantly higher customer balances.

Compensation and benefits expenses were $4.00 billion, 35% lower than the first quarter of 2007. The ratio of compensation and benefits to net revenues was 48.0% for the quarter, consistent with the first quarter of 2007. Employment levels increased 4% during the quarter, primarily due to the firm’s acquisition of Litton Loan Servicing LP.

As of February 29, 2008, total capital was $222.11 billion, consisting of $42.63 billion in total shareholders’ equity (common shareholders’ equity of $39.53 billion and preferred stock of $3.10 billion) and $179.48 billion in unsecured long-term borrowings.

Book value per common share was $92.44 and tangible book value per common share was $80.28, each increasing 2% during the quarter reflected 427.6 million of total outstanding shares including restricted stock units granted to employees with no future service requirements, of 427.6 million at period end.

Goldman repurchased 7.9 million shares of its common stock at an average cost per share of $198.87, for a total cost of $1.56 billion during the quarter and has still 63.5 million shares authorized for repurchase.