The Q1 earnings season for US stocks kicks off! Major Wall Street banks take the lead
高盛2026Q1業績直播
Key Takeaways (AI-Generated)
Financial Performance
- Generated second highest net revenues of $17.2 billion, net earnings of $5.6 billion, and earnings per share of $17.55
- Delivered return on equity of 19.8% and ROTE of 21.3%
- Global Banking and Markets produced record revenues of $12.7 billion with ROE over 22%
- Generated $62 billion in long term fee-based inflows including $22 billion in wealth management flows
Business Highlights
- Maintained #1 position in M&A advisory globally with significant transactions
- Closed Innovator acquisition adding $31 billion in assets, positioning as top ten global active ETF provider
- Raised $26 billion in alternatives fundraising with strong private credit strategies
- Achieved record quarterly performance in equities financing, particularly strong in Asia
Financial Guidance
- Expects tax rate of approximately 20% for full year 2026
- Expects Platform Solutions revenues to run lower for rest of year seasonally
- Anticipates NIM compression headwind to persist through much of 2026 in private banking
- Maintains annual alternatives fundraising target of $75-100 billion toward $750 billion AUS target by 2030
Opportunities
- Strong positioning in Asia with significant growth opportunities in FIC and equities businesses
- Implementing AI technology across six work streams for stronger operating leverage and efficiency
- Completed strategic partnerships positioning firm as top ten active ETF provider
- Accelerating cloud migration and data infrastructure investments to optimize AI deployment
Risks
- Heightened uncertainty in private credit sector with retail outflows in peer-managed funds
- Concerns around higher energy prices impact on inflation and economic growth
- Enhanced cybersecurity risks from AI-driven capabilities requiring accelerated infrastructure investment
- Ongoing regulatory framework changes with Basel 3 finalization and G-SIB surcharge proposals
Full Transcript (AI-Generated)
Operator
Good morning. My name is Katie and I'll be your conference facilitator today. I would like to welcome everyone to the Goldman Sachs First Quarter 2026 Earnings Conference Call on behalf of Goldman Sachs. I will begin the call with the following disclaimer. The earnings presentation can be found on the Investor Relations page of the Goldman Sachs website and contains information on forward-looking statements and non GAAP measures. This audio cast is copyrighted material of the Goldman Sachs Group, Inc and may not be duplicated, reproduced or rebroadcast without consent. This call is being recorded today, April 13th, 2026. I will now turn the call over to Chairman and Chief Executive Officer, David Solomon and Chief Financial Officer, Dennis Coleman. Thank you, Mr. Solomon. You may begin your conference.
David Solomon
Thank you, operator, and good morning, everyone. Thank you all for joining us. In the first quarter, we delivered a very strong performance, generating net revenues of $17.2 billion, net earnings of $5.6 billion and earnings per share of $17.55, all three of which were the second highest in the history of Goldman Sachs. As a result, we delivered a return on equity of 19.8% and an ROTE of 21.3%. These results reflect the strength of our global franchise and the depth of our relationships and our ability to execute for clients while maintaining a strong focus on risk management and a highly dynamic environment.
2026 began with a degree of optimism. Markets hit record highs. Confidence continued to build with most clients focused on growth, strategic activity and capital deployment. As we've said, things were only moving a straight line and as the quarter progressed the macro environment started to weigh on sentiments. Volatility increased meaningfully, the concerns around AI driven disruption sectors like software, heightened uncertainty and parts of private credit and the conflict in the Middle East. Against this backdrop, our performance underscores the importance of having a scaled, diversified and global franchise that can support clients across a wide range of market conditions.
Operating as a leading global financial institution requires deep expertise, long term investment and a culture grounded in risk discipline. This is what differentiates Goldman Sachs and what clients rely on, particularly in periods of uncertainty. We pride ourselves on being a trusted advisor and providing timely and differentiated insights. This quarter we have large scale calls and events reaching 10s of thousands of clients across the firm. We also saw elevated engagement with our digital channels, including Marquee with monthly average users up over 30% year over year in our global investment research portal, which saw its second highest single day of client activity in early March.
Beyond analysis and insight are people operating as one Goldman Sachs delivered for clients in real time as conditions evolved quickly. In Global Banking and Markets, we delivered record quarterly revenues reflecting strong client engagement across our franchise. Elevated uncertainty led to clients LED clients to actively reposition portfolios, driving strong flows across fit and equities. We supported our clients intermediation and financing needs across asset classes, deploying our balance sheet in response to demand in our commodities franchise. We acted as an intermediary for our clients of insignificant moves in energy markets, including a record monthly increase for Breck crude in March and price surges of 60% in European gas market.
Importantly, the growth of our financing business is added further balance to our performance, reinforcing our ability to perform consistently across cycles. In investment banking, we remain the number one M&A advisor globally. Clients continue to turn to Goldman Sachs for advice and expertise regarding their most important strategic transactions amid a backdrop of accelerating technological change and industry disruption. This includes the announced $43 billion merger of Unilever's business with McCormick, Cisco's $29 billion acquisition of Jetro Restaurant Depot and Comtera Energy's $26 billion sale to Devon Energy.
While market conditions tempered execution for IP, OS and sponsor activity broadly, we believe that activity levels will rebound once conditions stabilize. As you remember, our backlog closed 2025 at its highest level in four years. Even with exceptionally strong revenue production, our quarter and backlog remained extraordinarily robust. In asset and wealth management, clients continue to choose Goldman Sachs for the quality of our advice and our long standing investment track record. We generated $62 billion long term fee based inflows, including $22 billion in wealth management flows.
Assistant inflow momentum throughout the quarter including during the heightened volatility in March underscores the strength of our client relationships built on trust and long term performance. We are pleased to have closed the acquisition of Innovator in the second quarter which adds an additional $31 billion in assets of your supervision across the suite of over 170 ETF's focused on defined outcome strategy putting us in the top ten of global active ETF providers. An alternative as we raised $26 billion across asset classes with private credit strategy generating $10 billion.
We recognize that the private credit industry has been an area of increased focus in recent months. Our 30 year track record of performance and private credit is characterized by rigorous underwriting, selective deployment and discipline, portfolio construction and our largest non traded BDC. As an example, we saw a net inflows of over 7% this this quarter reflecting the divested investor demand for experienced investment managers who have navigated multiple rate and credit cycles. Looking forward, our predominantly institutional drawdown structures as well as the breadth of our origination funnel give us the flexibility to continue to patiently and selectively invest capital.
Overall, we feel good about the long term opportunity of private credit and our ability to deliver attractive risk adjusted returns for clients. Let me spend a moment on capital and regulation more broadly. We've been consistent in our view that a strong, well capitalized banking system in the US is essential and that strength has been clearly demonstrated across multiple stress periods. At the same time, we have also been clear that the regulatory framework needs to be transparent and calibrated appropriately to achieve its objectives.
Getting this right matters for the real economy. Well calibrated framework enables banks to provide liquidity, support lending and capital formation, and serve clients more effectively. Ultimately, a strong U.S. banking system supports growth, competitiveness, and economic resilience. Against that backdrop, we're encouraged by the direction of regulatory reform including the recent Basel 3 finalization and G SIB surcharge RE proposals. While the rulemaking process is still underway and we plan to participate in the comment period. We believe this direction is positive for the banking system as a whole that are aligning regulatory outcomes with actual risk all and we continue to see the potential for more constructive backdrop this year.
The combined effects of fiscal stimulus in developed economies, ongoing AI related capital investment and a more balanced regulatory agenda in the US are powerful forces. At the same time, the geopolitical landscape remains very complex and the ultimate impact of higher energy prices on inflation and growth is yet to be determined. We believe Goldman Sachs is extremely well positioned to navigate this current environment. Beyond the short term, we are also investing for long term growth including to 1 Goldman Sachs 3.0.
As I mentioned, clients seek our views and analysis around a range of topics including AI and we were able to speak to these trends from first hand experience as we thoughtfully, thoughtfully implemented new technologies across our six initial work streams and around the firmware broadly. We remain confident that over time one GF 3 point O will drive stronger operating leverage, greater resilience and improved efficiency in returns and allow us to continually elevate service to our clients. These efforts build on the strength that differentiate Goldman Sachs.
As we demonstrated this quarter. Our deep client relationship, global platform and strong risk culture position and strong risk culture position us to serve clients with excellence while creating long term value for shareholders. With that, I'll turn it over to Dennis to walk through our financial results in more detail.
Dennis Coleman
Thank you, David, and good morning. Let's start with our results on page one of the presentation. In the first quarter, we generated our second highest net revenues of $17.2 billion as well as our second highest earnings per share of $17.55, which drove an Roe of 19.8% and an ROTE of 21.3%. Let's turn the performance by segment starting on Page 3. Global banking markets produce record revenues of 12.7 billion in the first quarter and generated an ROV of over 22%.
Turning to Page 4, Advisory revenues of 1 1/2 billion dollars rose 89% year over year on higher completed volumes. We remain #1 in the league tables for M&A with a lead of 150 billion in announced volumes versus our closest. Year equity underwriting revenues of 535,000,000 were up 45% year over year on better convertibles results, while debt underwriting revenues of 811,000,000 rose 8% driven by better investment grade and asset backed activity. We ranked 1st in equity and equity related underwriting and ranked second in high yield debt underwriting and leveraged lending.
FIC net revenues were $4 billion. Within intermediation revenues and rates and mortgages were significantly lower versus the 1st this quarter of last year as results were impacted by a tougher market making backdrop. This was partially offset by significantly better results in currencies and commodities, illustrating the benefits of having a global diversified franchise. We produce 6 financing revenues of $1.1 billion remain confident in our ability to prudently grow this business over time.
Equities net revenues were a record $5.3 billion. Equities intermediation revenues of $2.7 billion rose 7% even versus very strong results last year, driven by better performance in cash products. Record equities financing revenues of $2.6 billion were 59% higher year over year with particular strength in Asia amid another record for average prime balances in the quarter. As we highlighted in last quarter's strategic update, Asia is one of the key growth opportunities for our FIC and equities businesses. And while there's still work to do, we're pleased by the progress to date.
Across FIC and equities financing, revenues of $3.7 billion rose 36% versus the prior year and comprised nearly 40% of total FIC and equities revenues. Let's turn to page 5. Asset and wealth management revenues were $4.1 billion. Management and other fees were up 14% year over year to $3.1 billion, primarily on higher average assets under supervision. Incentive fees were 183,000,000, up year over year. Despite the volatile environment during the quarter, private banking and lending revenues were 638 million.
Higher lending results were more than offset by the impact of NIM compression as we grew deposits in a more competitive rate environment in order to fund broader firm activity. Consistent with our growth strategy, we also expanded our lending to ultra high net worth clients with balances rising to a record 46 billion. Now moving to Page 6, total assets under supervision ended the quarter at a record $3.7 trillion. We saw 62 billion of long term net inflows across asset classes representing our 33rd consecutive quarter of long term fee based net inflows.
Turning to Page 7 on alternatives, Alternative AUS totaled $429 billion at the end of the first quarter, driving 597,000,000 in management and other fees. Gross third party alternatives fundraising was 26 billion in the quarter, putting us on track towards our annual fundraising expectations. On Page 8, Platform Solutions revenues were 411 million in the quarter, down year over year, reflecting the move of the Apple portfolio to help for sale. We expect revenues for the rest of the year to run lower in line with seasonal trends in the business.
On Page 9, firm wide net interest income was $3.7 billion in the first quarter. Our total loan portfolio at quarter end was 253 billion, up versus the fourth quarter, primarily reflecting growth in corporate and other collateralized loans. Our provision for credit losses of 315,000,000 reflected growth and impairments in our wholesale lending portfolio. Turning to expenses on Page 10, total quarterly operating expenses were $10.4 billion resulting in the efficiency ratio of 60.5%. Our compensation ratio net of provisions was 32%.
Non compensation expenses were 5 billion with the vast majority of the year over year increase driven by higher transaction based expenses tied to robust activity levels, particularly in equities. As David referenced, we are thoughtfully building out our one Goldman Sachs 3.0 work streams and our early learnings have reinforced the need to double down on the foundational elements of our infrastructure. We are therefore accelerating our investments in cloud migration and in the accuracy, completeness and timeliness of our data.
These investments are critical to optimizing the deployment of AI solutions across the firm, which will allow us to unlock greater productivity and efficiency opportunities over time. Our effective tax rate for the quarter of 13.2% benefited from the impact of employee stock based compensation. For the full year, we expect a tax rate of approximately 20%. Now on to slide 11. Our common equity tier one ratio was 12 1/2% at the end of the first quarter under the standardized approach, 110 basis points above our current capital requirement of 11.4%.
We saw attractive opportunities to deploy capital across the firm, including in prime brokerage and acquisition financing. These activities in addition to the increase in market risk RW as amid higher market volatility consumed a portion of our access capital. Additionally, we return $6.4 billion to common shareholders, including record common stock repurchases of $5 billion and common stock dividends of 1.4 billion. We will continue to dynamically deploy capital to support our client franchise while also returning capital to shareholders.
As David mentioned, we're encouraged by the direction of the recent Basel 3 finalization and G Sib Surchargery proposals, which reflect the more balanced and risk sensitive approach than earlier iterations. In conclusion, our performance reflects the diversification and strength of our leading client franchises, which enable us to serve clients in a volatile market. We are confident in our ability to continue to support our clients as they navigate this dynamic operating environment. With that, we'll now open up the line for questions.
Operator
Thank you, ladies and gentlemen. Now, we will now take a moment to compile the Q&A roster. If you would like to ask a question during this time, simply press * then the number one on your telephone keypad. If you would like to withdraw your question, please press *2 on your telephone keypad. If you're asking a question and are on a hands free unit or a speakerphone, we would like to ask you use your handset. When asking your question, please limit yourself to one question and one follow up question. We'll take our first question from Glenn Shore with Evercore.
Glenn Shore
Hi there. Thanks. So I, I guess I, I would love it if you could expand a little bit on, let's just call it balance sheet strategy because I, because I see you deploying capital, it's reducing the denominator. But but when the CT drops 180 base points, a lot of people ask questions. So let's just go towards the deposit strategy. Deposits grew a lot. I'm assuming that's to finance equity financing. So I'm curious how you think about the the trade off of of you know, lower Nii and asset wealth, but growing financing and I guess that feeds into your Asia, Asia strategy. So sorry to put a bunch in there, but it all overlaps each other. So maybe you could just expand a little bit on that. Thanks.
Dennis Coleman
Sure, Glenn, good morning and thank you for that. So I think I would I would take you back to our strategic update that we gave at the end of the year where we tried to lay out our expectations for how we were going to respond to the changes in the capital regulation. And that in particular, we'd be focused on deploying into the client franchise to support a bunch of our, you know, more durable revenue stream activities with lending being, you know, at the top of the list. And as we sit now at the end of the first quarter, you will see that we significantly expanded our activities in equities financing and a particular area of strategic focus was Asia, something that we also did call out at that time where we had identified a competitive gap.
We saw an attractive opportunity and with the excess capacity that we saw ourselves with, we deployed into that with clients and grew and grew our revenues. We also note that we recorded a record level of lending balances in private wealth. We continue to grow fixed financing. We grew our corporate balances, acquisition financing. All of these were the items that we called out as the priority areas for deployment and we saw opportunities over the course of the quarter to do that. I would be remiss if we didn't mention that we also, you know aggressively returned capital to shareholders, the record level of buybacks.
So you know the balance sheet growth was was largely in support of those client activities that I just referenced separately, you're right, we did have, you know, significant deposit raising activity over the course of the quarter that remains A strategic source of funding for us that we continue to grow. A lot of that growth did derive through the Marcus platform, which is a benefit to the firm. Some of that activity supports activities in AWM, but as you call that supports, you know, overall firm wide lending activities and it was a strategic priority for us to extend more lending on behalf of clients across the firm and we try to finance it as efficiently as we possibly can.
Glenn Shore
OK, maybe the two second follow up is the the net of that is I'm going to ask it as a good question is just, is all of the net of that deployment at at in lending? Will that come at RO ES that are in line with your long term goals?
Dennis Coleman
So you'll, you'll, you'll obviously see that the Roe performance for the firm, the Roe performance for global banking and markets, you know, north of 22% in the, in the case of global banking markets where a lot of that deployment is happening. So across our portfolio of activities, we are generating very attractive returns on that, on that incremental amount of lending activity.
Glenn Shore
Thank you.
Operator
We'll take our next question from Ibrahim Poonawalla with Bank of America.
Ibrahim Poonawalla
Good morning. I guess just wanted to take a step back. A lot happened during the quarter, so David, appreciate. Your remarks around the 30 year track record for Goldman and private credit, but if you don't mind, I think there was there is a sense that private credit is a significant growth driver for Goldman. If for our benefit given just the growth in this asset class, give us a sense of how you see this potentially impacting sponsor activity when it comes to MNAIPO as you think about the next year, fake financing is a been a big focus with investors around how that growth may slow down. So would love some color around how you think this actually coming home to impacting your growth outlook and if anything on credit that you're particularly watching out for? Thank you.
David Solomon
Sure. I mean, it's, it's a big picture question and I could I could appreciate the question and I could talk about it for a long time. You know, I, I, you know, I think there have been, you know, attempts to try to put this in perspective. I know the media headlines have driven, you know, an enormous amount of negative sentiment around private credit. You know, my own view is it's important to really distinguish between different markets and really try to put it all in perspective. You know, I think you guys know this that they're, you know private credit and the broadest definition you to possibly come up with is about 3 1/2 trillion dollars of assets.
But the thing that's been getting a lot of focus is direct lending and direct lending is about 1.6 to $1.7 trillion of assets of which the retail channel for that direct lending business is about 20% or about $230 billion of NAD. You know there are obviously is height redemptions and certain pure managed funds. You know these peer managed funds have been concentrated in retail outflows as opposed to institutional outflows. And one of the things that we're seeing that's just interesting, it's quite constructive for our business is that spreads are becoming more lender friendly.
And so when you look at our first quarter 2026 subscriptions and our GS credit BDC, 40% of them were from institutions, many of whom are first time investors on our platforms, including insurance companies, banks, pension funds. And when you look at our broad platform, it's over 80%, you know, institutional, you know, part institutional, part first, very, very broad, very, very diverse. And you know we've been growing it over a long period of time. You obviously saw our positive inflows of what we raised, you know, privately in the quarter. We feel we're very well positioned and actually the opportunity set to some degree is improving.
I know people are very focused on the cycle and they should be. This has been a long period of time. You know, X the COVID shutdown, it's been a long period of time without a, what I call a normal credit cycle, meaning a meaningful slowdown in the economy or a recession. Whenever you have a meaningful slowdown in the economy or a recession, you know there are higher loss levels in diversified credit portfolios. I think risk management and portfolio construction are very important in places where people haven't followed their portfolio construction carefully and they've gotten overweighted to a particular sector. They'll obviously have more headwinds.
But I don't, I think one of the things that's really not getting a lot of attention is if you do have a cycle, you know, what does that look like? And so if you take a very tough cycle, the global financial crisis, the cumulative default rates across the entire leveraged lending space, the entire leveraged lending space during the global financial crisis was 10%. Recoveries were about 50%. So the cumulative should have lost was 5 to 6% against coupons of nine to 10%. And so that is the business model of this. I think institutional investors understand that, you know, I think there's going to continue to be you know some noise around, you know, around, you know, the retail space.
I think you should watch that carefully. But I think this continues with any sort of a medium term, a longer term view to be a very, very attractive platform for us. And we are very confident that we have significant runway to further scale our business toward our $300 billion target. We've seen significant fundraising across the all platforms including this past quarter $10 billion in credit. And so we're going to continue to grow our institutional business and take a long term, a long term view. But it remains, you know, I wouldn't say, you know, it's a huge growth channel for us, but it's a business that's growing and we think has good secular construct for a scale platform like ours.
Ibrahim Poonawalla
Thanks for that, David, very comprehensive. If I can quick follow up, banks, CE OS were in DC on Friday around concerns around some of the AI given risks to banking infrastructure. Anything you can share with us in terms of what? Like, is this something extremely different than what banks have had to deal with over the last decade? To the extent you can share any color, I think that would be helpful. And what how do you perceive the risk to Goldman Sachs? Thanks.
David Solomon
Yeah, so thank you. Thank you for that. Obviously something we're focused on. I just, I want to start, you know, I want to start by saying that cybersecurity has long been at the core of our business and we have for a very, very long time put enormous resources forward to, you know, to think constantly about cybersecurity risks on our business. And it's something we've invested significantly in and continue to invest in. And you know, it's been widely reported that the large bank CE OS happened to be in Washington for a regular meeting in the Financial Services Forum.
And so we were asked to come over to Treasury. By the way, it is not the first meeting that that group has gone over to Treasury to talk about cyber security risk over a number of years. So, you know, my first point is this is something the industry's focused on. It's something we're focused on, and there's nothing new in that focus. Obviously the LLMS are making rapid progress and you know we're hyper aware of the enhanced capabilities of these new models. You know with the help of the US government and the model publishers, you know we are very focused on supplementing our cyber and infrastructure resilience and this is part of our ongoing capabilities that we have been investing in and are accelerating our investment in.
We're we're vetoes and it's capabilities. We have the model, we're working closely with Anthropic and all of our security vendors, you know, the kind of harness frontier capabilities wherever it is possible. And this will continue to be, you know, an important focus, but it's not, it's not new that is technology evolved. We have to continue to upgrade for cyber risk and make sure we're at the forefront of that.
Ibrahim Poonawalla
Thank you.
Operator
We'll take our next question from Erika Najarian with UBS.
Erika Najarian
Yes, thank you for taking my questions. David, if you could just unpack a little bit your outlook on the pipeline. I know in back in February, we talked about the sponsor community and their thoughts on valuation versus timing. Obviously a lot has happened more on the negative since then on valuation, but maybe just unpack on how your thoughts are relative to timing. I mean despite the conflict in the Middle East market still near all time highs. So would love to thoughts on that.
David Solomon
Sure. And I appreciate it. And I realize, Erica, this is getting a lot of attention. And I just say, you know, first of all, you know the environment for investment banking activity continues to be incredibly robust, particularly, you know M&A activity. And I do think as I talk to CE OS, of course they're watching what's going on geopolitically, but that's also balanced by the fact that they see an opportunity during this period of time to drive scale and scale creation in businesses with significant technological change. And they are focused on that. And that candidly Trump's some of the geopolitical risk is they have the opportunity to do consolidating trades.
And you saw that in the first quarter. You saw more large scale strategic M&A. We highlighted at the end of the first quarter the high level of our backlog, the highest level in four years. And then you saw extraordinary accruals during this quarter in M&A and you also saw extraordinary punishment, OK. The backlog really did not move very significantly at all, even though we had extraordinary accruals. And so we continue to see significant activity on the M&A front. And I don't see unless the overall environment got much, much worse, I don't see that slowing based on what we see at the moment.
That said, there's no question that with the conflict in the Middle East, IPO activity slowed a little bit, particularly in March. I do think there's a very full pipeline. And at the end of the day, equity markets have been extremely resilient. And if that resilience continues, I do think you'll see IPO activity accelerate again. There's some very large IP OS that are lined up and my expectation is a number of them are going to come because it's important for those businesses and for the capital formation around those businesses for that to happen. And they are also less sensitive to kind of short term geopolitical trends.
I do think that the level of uncertainty is higher. So we have to watch that carefully. Certainly talking actively to CE OS and CE OS are looking carefully at how what's going on, particularly with commodity prices is translating into the economy and into consumer demand. I think it's fair to say that people did not see that really translating through in the first quarter, but that doesn't mean that people aren't extremely cautious about whether or not it will translate through in the second quarter. My guess is to the degree that energy prices remain high, you will see that translate through a little bit.
But at this point, the underlying economy still remains relatively robust. But if the resolution of the conflict drags, that probably will be a headwind in some of these areas, particularly inflation trends as we get further into the 2nd and the third quarter. And so we'll have to watch that quickly. At the moment, M&A and capital markets have been pretty resilient to that and the environment continues to be quite constructive. But of course, you know, I don't have a crystal ball. You know, I and also all the market participants are watching and adapting as they see things unfold.
Erika Najarian
Thank you for that. And just to follow up on Ibrahim's line of questioning, because I think it's so important for the stock and the stock of your peers. But given everything you said, David, in a, in during the financial crisis, the Q loss rate and leveraged lending was 5 to 6%. You're seeing more lender friendly spreads, no issues and fundraising, especially on the institutional side. It seems that, you know, if we do have a regular waste cycle or even just something factor specific like like software in terms of marks that the ultimate loss to Goldman will be de minimis, but the opportunity in terms of spreads and market share could be notable. Is that the correct conclusion?
David Solomon
I'm, I'm, I'm going to make a couple comments on that. Most of this, Dennis, make a comment just about, you know, historical, you know, historical losses. But I, I, you know, I think, I think Erica, you understand it, right. Remember, we're generally dealing with institutions and one of the things that happened, we had a slowdown in the economy, a recession where credit spreads widened. The business actually for institutional investors becomes more attractive and that is a point in time institutions rely on. Goldman Sachs has been at this for a long, long time to have the judgement to be more cautious on their deployment when spreads are historically tight and more aggressive on deployment when spreads are historically wide.
And one of the things that I think has not been talked about a lot over the course of of a number of years because we haven't seen it, a lot of the alpha that's generated in credit businesses comes from how the investors manage restructurings and you know, buy in when things are tough. But we haven't had a cycle like that. I do think we all have to recognize that this has been a very long credit cycle and when credit cycles go on longer market participants, this is a generalization. This is not the way we think about the business. But spreads get tighter, market participants get more aggressive to deploy capital.
And so when you do have a cycle turn in a recession, you will see higher losses across the space than you would have had if it was a shorter cycle. And so we have to be cognizant of that. You know, that said, we feel very good about the way we're positioned, very good about our track record, very good about our flows. And to the degree there was a cycle, we'd actually view it as an opportunity for Goldman Sachs. Dennis, maybe you want to comment a little bit more on historical Wall Streets.
Dennis Coleman
Yeah, I mean, Eric, I could add to you another area that we get questions for obvious reasons is across the fixed financing, the asset secured lending portfolio of the firm where a lot of those clientele are in the are in the alternative space. And we have a big diversified business that we've been growing and it's providing part of the ballast to our overall GBM revenues. But if we look back over the course of history on our fixed financing activities, our life to date realize losses, if you exclude some direct commercial real estate life to date realize losses are 0.
So that's obviously a Nexus quote, UN quote with private credit as a sub component of that portfolio. And people ask about it a lot and that may not always be the case. But so far the way that we underwrite that portfolio, the way we run the stresses, the way that we, you know, focus on our collateral protection or covenant structures or margining capabilities, that portfolio has realized losses of 0.
Erika Najarian
Thank you.
Operator
We'll take our next question from Mike Mayo with Wells Fargo.
Mike Mayo
Hi, can you comment on the increase in the provisions in global banking markets? It seems like that increase was a lot more than the growth in the balance sheet and that the increase you know, is a almost equals what like I guess like 3/4 the increase from last year. So is, is that a ton degree is consistent with the, the growth and the balance sheet. But to what degree are you putting aside extra provisions for problem losses due to macro concern for things that you're seeing out there and to what degree maybe you're sending a, a signal, hey, things might not remain as good. Thanks.
Dennis Coleman
Sure. Appreciate, appreciate that question Mike and and you actually answered it for yourself, but I'll do it, I'll do it, I'll do it for you back. So the the composition of that PCL build was in part attributable to growth. So as I went through earlier on. The call, we grew lending activities in the first quarter across the firm that increased lending activity attracts provisions. We also did have impairments, single name impairments across the portfolio which we have typically we have those impairments as well and we have adjustments for the overall operating environment and the outlook.
So it was really the combination of those three things that come together for that PCL build. I kind of answered it on the previous question. But if there was a question as to whether that PCL relates to private credit somehow or relates to our fixed financing business, answer is no. It was growth. It was growth across the the various lending streams, at least not from a default or credit impairment perspective. That's sort of broader, broader lending growth in the in the GBM segment.
Mike Mayo
And then a separate question, to what point at what point do investors kind of put their pencils down? Sounds like they're not that people are still trading and engaging and have high activity levels. But do you see a, a difference between the engagement with corporates as opposed to everybody else, investors and the whole ecosystem? In other words, that my, my question really is, are corporates more engaged and is there some de risking out in investor land?
David Solomon
I, I, so, so first at a high level, Mike, I, I think people are very engaged, OK, across the, across the franchise, corporate investors, you know, very, very, very, very engaged. You know, I think, I think it's an, you know, it's an interesting moment because there's so much going on in the world of technology and innovation and so much around, you know, that space that that people are extremely engaged in understanding how that creates opportunities for enterprise, how that shifts investment theses. And you know, we're not seeing, you know, any decline or pencils down.
You know, as you suggested, I will say the corporate world and I highlighted this before is incredibly engaged right now because they don't operate in the short term noise. They operate, you know, over the long term and they believe they have an opportunity to drive scale and consolidation and they haven't had it, you know, for a previous, you know, a previous administration. And so they are, you know, they're, they're focused on that. I expect that to continue. You know, obviously and as I said before, I don't have a crystal ball. If you know the macro situation gets bumpier for a short term period of time, you know that can have short term effects on investor behavior.
But I'd say at this point people are very actively engaged and look, we're only a couple of weeks until the quarter, but the quarter had started, you know, with with very significant engagement across all aspects of the business. Quarters started in a positive way. We'll see level of uncertainty is higher, but at the moment the engagement is pretty high.
Mike Mayo
Thank you.
Operator
We'll take our next question from Steven Chubbuck with Wolf Research.
Steven Chubbuck
Good morning and thanks for taking my questions. So can you take this in a slightly different direction? Wanted to ask on the efficiency outlook, you'd indicated some front loading of infrastructure investments, cloud migration in advance of AI driven investments that you plan on making. Just given all the investments that you cited in terms of what you're deploying on the platform, how should we think about the trajectory of non comps that 5 billion baseline is a little bit higher than what we've seen in recent quarters and just bigger picture how that informs the timing for when you can reach that 60% efficiency goal or if it impacts it at all?
Dennis Coleman
Sure, Thanks Steve, it's Dennis, I'll take that. So obviously we continue to make make progress on the on the efficiency ratio overall slight improvement on on a year over year basis and we remain laser focused on driving towards the 60% level. We did have a higher level, you know of non compensation expenses, but if you if you pull apart the year over year delta, it was you know rough magnitude 650 of the 750 million increase was attributable to transaction based expenses. And you know, we talked about how we've been growing the overall activity particularly across equities, particularly in Asia.
If you look at some of the BC any expenses, if you look at the stamp duty expenses, we have some distribution fees in AWM. There were high levels of client activity that we executed across the quarter and some of that comes with with transaction based expenses. So we remain focused on doing what we can on the unit cost elements of transaction based expenses and as in prior years have dedicated work streams to driving benefit from a unit cost perspective. But the overall volumes which is reflected in the record results for the equity business obviously came with transaction expenses.
As relates to the overall investment profile, we are continuing to make investments to drive, you know longer term efficiencies. And the more we focus and do work on it, we appreciate that having, you know, greater capacity to to migrate activities to the cloud and to harness, you know, a lot of value from data sense, you know, augurs for investment now to drive, you know, unlock in future periods. So that is that also features in our thinking. But at the same time, we're looking at other areas where we can reduce expenses. So there's categories of our overall operating expenses which we're moving down by more than you know, double digit percentages on a period basis as we look to get more efficient.
So there's sort of puts and takes across across it and we remain focused on driving towards a 60% efficiency ratio.
Steven Chubbuck
And for my follow up just on the Fed's capital proposal, I was hoping you could provide some at least preliminary guidance on the three bigger buckets of proposed changes, whether it's the adjustments to the RWA calculation first, second, the G sub surcharge in the proposed changes there. And then third, how the elimination of double counting could provide some relief going forward. And just trying to gauge like how that informs where you're comfortable running on CET one versus the current ratio of 12 1/2 percent.
Dennis Coleman
OK, sure. So as David said in his in his remarks, we're following the RE proposals closely. We do expect to comment. We are encouraged by the direction of travel, but we will have comments and we think there is room, you know room for further improvement. Double count is definitely an area of of focus for us, particularly as it relates to off risk. We think there's further enhancements that can be made to FRTB and CVA across the proposals. We think you know, G Sib again, making progress, perhaps not recalibrated as far as it could have been, but making, you know, making the right, you know, directional changes as it relates to impact on the firm and how we're calibrated.
You know, we start the second quarter at 12 1/2% from ACT one perspective, 110 basis points of cushion, which is basically at the call it the wide end or just outside our our typical operating range. And we think that's an appropriate level, gives us capacity to step in and support, you know, the types of client activities that we continue to see coming through the franchise, gives us capacity to continue returning capital to shareholder. And I would say finally, based on everything that we see, we think is a prudent place to be as some of those regulatory proposals get get refined and finalized.
Steven Chubbuck
Thank you.
Operator
We'll take our next question from Brennan Hawkin with BMO Capital Markets.
Brennan Hawkin
Good morning. Thank you for taking my questions. David, you spoke to strategic activity and and how robust it is in banking. Curious to hear your thoughts and what you've been seeing as far as sponsors are concerned. We we've heard a great deal in recent years about building pressure for sponsors to sell. And so how, how big of a set back is the valuation reset and tighter financing markets to that cohort?
David Solomon
Yeah, I mean, this is, this is something that continues to get, you know, lots of attention and and, you know, it's, it's, you know, sponsor activity out of the private equity section of sponsors. And again, you know, I want to highlight, you know, that that's a small universe when you think about overall capital markets activity broadly, that spot that sponsor activity has been slower. I do think it will continue to accelerate, but it's, you know, when you look at the overall performance, again, I think one of the things we just want to highlight, we've been working very hard for the last 7 or 8 years to really build a larger, much more scaled, diversified business with more steady streams, you know, in it.
And I think this quarter is a, you know, a great, great example. There was not, you know, sponsor activity did not accelerate this quarter the way we might have fought given the way things felt. We had the last earnings call in January, but at the same point it was the best global banking markets quarter ever firm. And so it was a very, very good quarter even with weak sponsor activity. It's a big, broad diversified business. Obviously, there's a tailwind that's coming. When sponsor activity turns on, it will turn on. These sponsors do not own the capital. The LP's on the capital, they will have to return it to them.
So it's been slower than we'd expect, but the business is big and broad enough and diversified that, you know, even with that slower sponsor activity, it's not had a big impact on the overall business. The other thing I would add, you know, a lot, a lot those comments relate to monetization and exit, exit activity, which we're very focused on, which you know ripples through the firm in a variety of places. But at a certain point you have asset price adjustments in one industry or another. And all of a sudden it presents opportunities for sponsors to actually redeploy some of the dry powder that they've been husbanding for some period of.
Time all of a sudden public to privates to come back and focus. And so while there there could be given the uncertainty of the war, some slow down in IPO type monetization. That doesn't mean that the sophisticated sponsors of the world aren't thinking much like some of the well capitalized corporates as to whether or not they can't take advantage of some of the the dislocation. So there's there's multiple ways to think about it. Absolutely great.
Brennan Hawkin
Thanks for that color. And Dennis, I'd love to follow up on your comments on fake financing. Do do you have any color on what proportion of your fake financing exposure is tied to direct lending counterparts? I know it'll probably fluctuate, you know within a range, but maybe a rough idea of how to think about the bookends.
Dennis Coleman
So it really is a question of care, you know categorization. So there are underlying sponsors and alts managers to whom we extend our fixed financing from like an we think about it on an underlying asset class perspective because a lot of these bilaterally extended loans are collateralized by an underlying pool of loans to discrete and markets, residential mortgages, consumer finance assets, private credit assets, private equity assets. So we run capital call facilities. These are all sub components of fixed financing and the entire book is well diversified against each of those end end asset class pools.
And we underwrite the loans on with different sort of underwriting and risk parameters based on stresses we see for the various sort of end end asset class. So I, I don't think it first and foremost, we run it on a diversified basis, but it's, it doesn't lend itself to the same kind of sort of portfolio concentration risk if you have idiosyncratic bilateral structured credit extension where you have the capacity in each discrete situation to set the protections that you think are appropriate for the underlying risk.
Brennan Hawkin
Thank you.
Operator
We'll take our next question from Manan Gasalia with Morgan Stanley.
Manan Gasalia
Hi, good morning. I just wanted to follow up on the expense question. The comp ratio on adjusted revenues was down from the usual 33% in the first quarter. I know you typically threw up based on the environment at the end of the year, but is the year on year change so far being driven by ONE GS 3.0 and the AI investments you're making? And is it a signal for the direction for the full year? Thanks Ma.
Dennis Coleman
Welcome, welcome to the call. Look on the comp ratio, you know we grew our revenue significantly and we remain, as I said earlier, very, very focused on driving the firm towards a 60% efficiency ratio. So you know, given the up tick in revenue, given our outlook, we did bring the the ratio down 100 basis points versus where we had set it in the first quarter last year. But we have a different amount of revenue and a different outlook. We obviously will adjust that as we go through the year based on our expectation for the full year.
But currently that's our best estimate for how we expect to pay. We remain to be, we remain very much paid for performance that underpins everything. Talent remains very dear and we're very focused on attracting and retaining the best talent. That's what's required for us to deliver these results for clients. But we're also focused on operating the firm as efficiently as we can. So 32 percent is our best estimate balancing those objectives.
Manan Gasalia
Great, thank you. And can you expand on what drove the weaker fake intermediation revenues this quarter? You noted lower rates, mortgage and credit. Was that driven by a tougher year on your comp? Was it specifically driven by the higher geopolitical risks or you know, is there any specific client behavior that you're seeing that may spill into the rest of this year? Thank you.
Dennis Coleman
Sure. Thanks Manan. So you know we say many times on this call we look in particular at components of our FIC portfolio. We remain very, very committed to having a leading presence across all of the the sub asset classes and continuing to do that on a global basis. In the last quarter, in the first quarter of this year relative to the first quarter previously, we saw significant increase activity and more strength in the commodities business and more strength in the currency business, but mortgages and rates lower. That was basically just a function of the overall environment making markets.
We have big activities across all of those activities. We remain actively engaged with clients, but our you know, our performance in in rates and mortgages relatively lower performance in currencies and commodities was relatively stronger. I think it's just also I just, I just, I just admin on, you know. Also a lot of this has to do with expectations that are set, you know, in the research community, you know, this, this, this fit performance still has to be put in context. It was the 10th best fit quarter ever, you know, out of 100 and some odd quarters.
And when I look at the scale and the diversity of the business, you know it's, it's, it's performing very, very well. So we obviously had a very, very strong comp in the first quarter last year. It is 29% better than the last quarter we had in the fourth quarter of the year, but it was, you know, close to a top decile 6 quarter and certainly the top quartile 6 quarter. And what you're seeing, you know, if you go back again, I want to go back and highlight we've worked hard to scale the business, make it more diversified.
If you go back 1520 years ago, we could not have 1/4 like this with a quarter where Fick looked a little bit weaker because Fick was such an important component of business. It's now a much more diversified business. You know Fick performed well in the quarter and and you look at the overall performance, the overall performance was obviously quite strong. Some quarters it's going to be stronger here, stronger there.
Manan Gasalia
Thank you.
Operator
We'll take our next question from Dan Fannon with Jefferies.
Dan Fannon
Thanks. Good morning. In terms of private banking and lending, you talked about some of the moving parts in terms of deposit spreads as well as higher lending balances. So curious about the outlook there and what is the reasonable goal as you think about penetration of lending within your wealth business, how to think about that in terms of the aggregate opportunity?
Dennis Coleman
Great, thanks very much. So look, I think our performance in that piece of AWM is you know in line with what we've been trying to achieve. So obviously continue the lending penetration record record balances of 46 billion. I think we still have a long way to go. I think there's a lot more that we can do for clients in that segment and we are making progress, but it's going to take time to actually meet, you know the all of our ambitions for for penetrating that segment. We're, you know, aggressively offering the capabilities. I think more and more clients are coming to appreciate the value that it adds.
So we feel good that we've taken that to to record levels. We think there's a lot more to do and we also you know remain very committed to growing the deposit balances across across the segment. We're also able to do that very, very successfully. You know, there there is an impact from you know the more competitive environment for deposit raising. And and you know, we do expect that will persist as a headwind, you know for much of 2026. But we would expect as we move into 2027, we'll be back growing that segment, you know, high double digits from a sort of durable revenue perspective.
Our our aggregate durable revenues in AWM, you know, we're up high single digits for this most recent period. But it was a function of sort of more strength on the management fee line and less performance in the private banking and lending line. And we'd expect that to you know, improve towards the end of the year heading into 2027.
Dan Fannon
Great. And as a follow up, obviously a strong quarter on fundraising for the Alts again, can you talk specifically about what strategies and credit got you the 10 billion? And as you think about the rest of the year, do you see credit being as being as big of a contributor to growth or given some of the headlines and dynamics that that likely is to see some moderation?
Dennis Coleman
So coming out of our strategic update, we obviously gave guidance in terms of the aggregate Alts, you know assets under supervision target that we put out there for 20-30 of you know 750 billion. We put out that annual fundraising target of 75 to 100. Our platform is highly diversified. So we have success raising across corporate equity strategies, across credit strategies, across real estate, across hedge funds, etcetera, etcetera. And within credit, we have a variety of of different strategies that we can raise on based on your level of the capital structure, type of risk profile, geographic location of the fund, etcetera.
So you know we have multiple sort of multiple pillars that we're focused on continuing to drive the ALTS fundraising that can vary from quarter to quarter in terms of putting together the full year, full year results.
Dan Fannon
Thank you.
Operator
We'll take our next question from Devin Ryan with Citizens Bank.
Devin Ryan
Thanks so much. Morning, David. Dennis, just another question on artificial intelligence. Obviously, I think investors are going business by business, just kind of understand implications and so good just to hear, you know how you're thinking about what businesses will be most impacted and you know just whether AI overall is an accelerant for Goldman Sachs like it has been or the technology cycles in the past have been and just how you're thinking about even broad strokes would be helpful. Thank you.
David Solomon
Yeah, Yeah, I appreciate the question, Devin. And it's, it's, you know. Hugely forward leaning on the power of this technology to accelerate growth and efficiency in Goldman Sachs and allow us to more aggressively invest in growth in areas of our business where for a variety of reasons, you know, over the course of the last five years, we've been more constrained than I think we're going to be for the next 5 years. I think this is true not only with Goldman Sachs, I think this is true with lots of other businesses with enterprises broadly and as enterprises take advantage of that, that spurs activity that feeds into Goldman Sachs ecosystem.
So I do think as an other technology super cycles, this is extraordinarily constructive for Goldman Sachs. It's one of the reasons why when I think about the firm over the next three to five years and I think about the growth trajectory of the firm that we're driving for, you know, I can't, I don't have a crystal ball to predict short term, you know, short term uncertainty and short term volatility. But I have a high degree of confidence when I look at over three to five years as to how we can continue to grow the firm, serve our clients, you know, more broadly accelerate our investment in areas of business where we see, you know, real opportunities to grow.
And then I point to 1, like Private Wealth, for example, where we see so very, very significant opportunities given the nature of our Private Wealth franchise to grow. It will not be a straight line. Whenever you have acceleration in new technology, there are going to be bumps and there are going to be risk issues and there are going to be recalibration. I'm sure we'll see that, you know, in the coming years, the scales, but the power that sets technology, the ability to use it in an enterprise to remake processes, to create efficiencies and also create more capacity to invest in growth.
I can't find ACEO that's not talking about that. And all of that with a medium term lens when you get out of the short term moment and noise is incredibly constructive for Goldman Sachs.
Devin Ryan
OK, thanks David. Quick follow up Dennis, just on Asia and the success you've been having there, you obviously really positive progression over time here. So just the gap that you talked about that you're closing where, where are you in that? Is there still opportunity to accelerate or or do you kind of close that gap with the big step up that you have this quarter?
Dennis Coleman
So we think we've made progress, but we are constantly reassessing each and every region of the world and each sub product line gap that we think we may have relative to the potential there. There were constraints on the aggregate quantum and and type of resources that we could deploy to accelerate those activities given some of the changes in capital rules. We move quickly to do that for clients in the first quarter and you can see it coming through in the results. I would expect versus what we're looking at, we would have closed the gap, but I do expect there's still a lot more for us to do. So I think good progress, but more to do across Asia.
Devin Ryan
Thank you.
Operator
We'll take our next question from Matt O'Connor with Deutsche Bank.
Matt O'Connor
Hi. I want to follow up on AWM, the long term flows you showed on Slide 6, just really good balance between the three channels, but I wanted to kind of dig into what's tracking a little better than what you laid out last quarter. I think you were targeting about 5% flows. We've got 3/4 in a row of about 7% little boost from the deal this quarter. But just overall it seems like it's tracking better than that target you have and wondering what the drivers of that are.
Dennis Coleman
Sure. So we that was one of the new targets that we put out in the strategic update just to, you know, both focus your attention on the overall quality of our wealth business and and frankly focus our people internally on that target as well. It is an annual target. We do have a 5%, the tip of a annual target first quarter delivered 9%. So you're right, we're quite significantly ahead of the target in one quarter, but that could have been flow from from 1/4 to the next. But I would say were you know, to David's comments on sort of just thinking about overall levels of engagement across the firm that doesn't that's not confined to traditional realm of investment banking or even, you know, ficking equities.
There's strong levels of engagement across our asset and wealth management business and we're seeing good support across the wealth channel happens to be well ahead of target for this quarter. But we'll we'll be continuing to focus on driving it, you know, as as high as we possibly can over the balance of the year.
Matt O'Connor
And then any early benefits from, you know, there's a three deals and partnerships that you've announced the last few months? T Rowe industry and innovator, I think innovator just closed. So, but any early benefits from those And how should we think about, you know, the opportunity that we going forward?
Dennis Coleman
Yeah, we, we, we feel very, very good. We obviously just closed innovator in the last week. We feel very, very good about the partnership and the, and the, and the three deals and, and the two deals, excuse me. And, and you know, we're integrating the teams. The teams are very. Excited and very focused on being here. You know, I think the cool thing we mentioned in the script about Innovator is it immediately positions us as one of the top ten active ETF providers. And obviously in the active ETF space continues to be very, very good secular growth.
I, you know, I think with what's going on in technology, you know, the strengthening of our positioning around the venture community through industry ventures, we're seeing enormous synergies in the business and by the way, synergies in the wealth business. Do you know out of that platform coming on board. But look, this is, this is new and you know, I don't want to overstate it, but we feel very, very good about the decisions we've made on both the partnership with T Rowe and the two acquisitions. And we'll report more as we have more substantive things to tell you.
Matt O'Connor
Thank you.
Operator
We'll take our next question from Gerard Cassidy with RBC Capital Markets.
Gerard Cassidy
Good morning. Thank you. Dennis, you touched on in your comments about your CET one ratio that you've folks have used the capital to, you know, grow the businesses across the firm and you specifically highlighted acquisition financing. Obviously, as David pointed out, you guys are the leader in M&A advice. Can you share with us the November changes to the leverage ratios that the regulators did away with? Has that helped you guys become more competitive in acquisition financing? And 2nd, how much of the acquisition financing do you try to keep on your books or do you try to syndicate it out to participants?
Dennis Coleman
Sure, appreciate those those questions, Gerard. So what goes hand in glove with the with the uptick in strategic activity that David's been discussing and with a particular focus on the corporate sector is that a lot of those transactions, you know, require large scale capital commitments. That's really what I'm referencing with respect to acquisition financing. Yes, the changes in the capital regulations give us more flexity, more flexibility to deploy into that, but they're also timing elements. So in the same way that you can have an announced M and a transaction, you can report on announced volumes, you don't recognize revenue until that M and a transaction closes.
If you take on risk in an acquisition finance book and you have that exposure on your books, you need to, you know, set aside the appropriate amount of capital, but you won't be recognizing revenue necessarily until the transaction funds or closes. So there are timing you know mismatches or things to be aware of with respect to those items. As it relates to acquisition financing, our general philosophy is to facilitate the transaction to underwrite and distribute the paper into long term holders of that you know that loan or bond instrument. We do retain some exposures to clients or as part of the overall relationship banking philosophy and from time to time we can hold other exposures as well.
But the general base case assumptions that we underwrite to distribute for most of the acquisition financing activity.
Gerard Cassidy
A very good thank you. And then to follow up on your comments that you made about the PCL, you obviously identified the three areas of what drove the PCL on a year over year basis loan growth, the single with company single name impairments and then the operating environment. Can you give us more color on the single name impairments, what types of credits were impaired? And then just from a technical standpoint to the impairments go through the net charge off line or is it through another line on the PNL? Thank you.
Dennis Coleman
Thank you Gerard for for your question. The growth piece is across the board. The impairment piece is actually, you know, several very small sort of names. I don't think it's particularly thematic. And then we have a sort of a general we, we look at the overall operating environment and we want to make sure we have calibrated, you know, the appropriate amount, the appropriate amount of reserves given, you know, given the environment that we that we, that we say thank you.
Gerard Cassidy
We'll take our next question from Chris McGrady with KBW.
Chris McGrady
Oh, great. Good morning. I want to go back to the to the change in the CET one, the 180 basis points like quarter certainly I understand buybacks a piece of it, but I was wondering if you could unpack or elaborate just a little bit more on the RWA growth by product, anything unusual in the quarter of the 85 billion or so? Obviously I can, I appreciate trading assets can move around. I'm just I'm just trying to fully understand the capital message relative to the 12 five that you're at right now. Thanks.
Dennis Coleman
Sure, believe it or not I I use words but all those words calibrate to numbers. So the drivers of the CET 1D of 180 is related to buy backs and on RWA it will resides with. The biggest buckets are growth in prime financing, acquisition financing and then market risk RW as those are the three big buckets on the RWA side. And then add on to it the record level of return of capital to shareholders and that's what explains the quarterly delta and CET one, OK.
Chris McGrady
And the 12 1/2 roughly 100 basis points is a is a reasonable buffer, It's 110 right now. And we think that that's a reasonable buffer that gives us flexibility along each of the three principal vectors that I that I identified more client activity, more return of capital to shareholders and appropriate flexibility regardless of how the current proposed regulatory rules pan out.
Operator
We'll take our next question from Saul Martinez with HSBC.
Saul Martinez
Hi, thanks, good morning. Thanks for squeezing me in. I wanted to go back to the equity results and and the the strength there and you know ask the question that I expect you guys are tired of answering. But the durability of that what is durable versus what is extraordinary it it, you know your equity financing revenue 2.7 billion this quarter that's you know more than double what it was in the first quarter of 24. And the intermediation income is also well above what it was, you know, even, you know, five years ago, six years ago, 20, 21 in the initial phases of the pandemic, but in balance sheets are expanding.
You mentioned investor engagement remains robust, but is there a way, how do you think about the risks here to this level of revenues, what is extraordinary versus what is durable? And I guess different way of asking, you know, maybe what kind of environment would be needed to see a reduction, lower results and you know, what kind of environment would be needed to see sustaining these results and even growing from here, albeit, you know, with much more tough, much more difficult comps. So I know a lot in there, but just the whole question of durability versus, you know, what's extraordinary, what your thoughts are there?
Dennis Coleman
Sure. I, I, I appreciate, I think there's a couple of underlying drivers. So if you take the way you frame your question, take a multi year trend, you know, market caps around the world are expanding equity trading activity and the participation by a broad range of our clients has been expanding. We have had a concerted effort to improve our market share position with leading clients across both FIC and equities and we have been consistently fueling some of those activities with balance sheet and capital commitments to support those client activities.
It's it's jumping off the page given some of the most recent increases, which again are a function of stepping up some of the capital deployment to support that activity and then the certain sub segments of the world that are very, very attractive. So you have a slight shift in the mix profile. So those are all the factors that are driving those activity levels consistently higher. The the flip side is also possible where you see significant drawdowns or much less active environment clients were looking for a lot less by way of equity financing from us then those activity levels would would reverse.
But you know, despite all of the various types of volatility we've seen over the last quarter, the last number of years where markets go up and markets go down and clients lever up and clients lever down, there still is a tremendous amount of demand from clients for us to step in and support them with financing. And we work very, very hard to both support clients, but also be disciplined and thoughtful about how and to whom we extend what types of financing so we can continue to also deliver attractive returns to to shareholders.
Saul Martinez
OK, that's helpful. Maybe just a quick follow up then on the the the question of thick results this quarter, obviously some softness in rates and mortgages sounds like this is more of a more generalizable about, you know, related to the market backdrop as opposed to anything golden and specific. Is that right? And I did notice that bars and rates did go up quite a bit. It wasn't you know an area of softness just any color there is to you know, whether there's a reason for that divergent that is notable, sure.
Dennis Coleman
So you're right, borrowing up across rates, borrowing up across commodities bar as you know is a is a calculation that has a rolling 30 day contributor based on volatility and volatility across rates and commodities in the first quarter went up. And that is the that is what mathematically drives the change in in in the bar ratio. Thank.
Saul Martinez
Thank you.
Operator
We'll go next to Mike Mail with Wells Fargo.
Mike Mayo
I just a follow up on the sponsor activity and what percent is the sponsor activity of your investment banking activity? I know. You said it still hasn't come back and that's potential upside in the future, but is it like 10% or 20% or historical 33%? Where is that right now?
David Solomon
Yeah, I don't, it's not a number we've disclosed, Mike. But obviously in an environment where we post an M and a quarter like the M and 1/4 that we we posted, it's a smaller percentage, a meaningfully smaller percentage. I'm not suggesting that it's not a meaningful business, you know, for the firm, but it's it's, it's, it's, it's not a number. It's not a number that we've specifically disclosed. I would say, you know, it moves around based on, you know, activity levels and based on what's going on.
But again, you know, I come back to the point sponsors important. It's a huge client base. We deal a lot with sponsors by the way, we deal a lot with sponsors this quarter. But it is a big diverse business. And you know, you look at the overall performance, we can have one sector be weaker than we would have liked and still have very strong performance. And so this is an example where we have very strong banking performance with a weaker sponsor performance than I might have thought three months ago, but it didn't affect the overall strength of the banking performance.
Mike Mayo
And to be fair, you've talked about sponsors for a few years. Look, your mergers are there. You're number one, we get it. But you talked about sponsors for a few years and you had another CEO talk about over 10,000 large companies that remain private even with record high stock market. So why is that? Why do they remain private?
David Solomon
Yeah, yeah. I mean, look, I, I mean a couple of things. But first of all, Mike, I think one thing that's just interesting to put in perspective is when you when we're talking about sponsors in this context, I think you're talking about private equity. And so remember, you know, sponsors do a lot of things. They do infrastructure, they do real estate, they do credit. I mean, it's, it's, it's a bigger thing. But if we look at they do growth equity, when you look at private equity, the rough enterprise value meaning equity and debt of all the private equity owned companies is like $4 trillion.
So it's less than one NVIDIA. Let's just start there. When we're talking about capital and capital flows to put that in, you know, in some, you know, in some perspective, I think one of the reasons why the private equity, you know, firms have been slower to monetize is the economic incentives that are set up given the optionality to wait. And we had a dynamic where values and private equity portfolios got marked up meaningfully in 2020 and 2021 because of that cycle and making no comments, you know, on where they're marked.
It raised expectations around monetization and people are waiting. And by the way, as the economy grows, the world grows, a lot of these businesses do grow into those valuations. And the way the incentive system works, you know, they really, really the only optionality LP has LP's have to put pressure on GPS is to not participate in the next month. And so, you know, I, I do think there's some pressure that's mounting. I do think you'll see more activity. But at the end of the day, they've been, they've been, you know, they've been a little, they've been, they've been slower and they've been taking that optionality.
Now, that said, I, I think a lot of activity will come over time. We're very well position for it. And again, you know, I, you know, I just want to, when you look at this whole ecosystem and how things are working, it's a pretty constructive investment banking ecosystem. You know, at the moment, obviously if the sponsors and private equity turned on, it would be even more constructive for us. But it's pretty constructive at the moment as we look at it.
Mike Mayo
Thank you.
Operator
Ladies and gentlemen, that will conclude our question and answer session and also concludes the Goldman Sachs first quarter 2026 earnings conference call. Thank you for your participation. You may now disconnect.
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