Wall Street investment bank Goldman Sachs Group, Inc. reported net revenues of US$9.4 billion and net earnings of US$2.1 billion for its second quarter ended May 30.

Diluted earnings per common share were US$4.58, down from US$4.93 for the second quarter of 2007, but an improvement from the US$3.23 it earned for the first quarter of 2008. Annualized return on average common shareholders’ equity was 20.4% for the second quarter of 2008 and 17.6% for the first half of 2008.

Net revenues in trading and principal investments were US$5.59 billion, 16% lower than the second quarter of 2007 and 9% higher than the first quarter of 2008.

Within the fixed income, currency and commodities division, net revenues were 29% lower than the second quarter of 2007, reflecting significantly lower results in credit products.

In equities, revenues were essentially unchanged from the second quarter of 2007, as significantly higher net revenues in the client franchise businesses were offset by significantly lower net revenues in principal strategies. Commission volumes were strong and were higher compared with the second quarter of 2007.

Net revenues in investment banking were US$1.69 billion, 2% lower than the second quarter of 2007 and 44% higher than the first quarter of 2008. Within the division, financial advisory revenues were up 13% from the second quarter of 2007. But revenues in the firm’s underwriting business slipped 13%, reflecting significantly lower net revenues in debt underwriting, partially offset by significantly higher net revenues in equity underwriting. The decline in debt underwriting was principally due to a decrease in leveraged finance activity, as market conditions remained challenging. The increase in equity underwriting reflected strong client activity. The firm’s investment banking transaction backlog decreased during the quarter.

Net revenues in asset management and securities services were US$2.15 billion, 18% higher than the second quarter of 2007 and 5% higher than the first quarter of 2008.

“Given the difficult market conditions, we are particularly pleased to be able to report strong results for the second quarter,” said Lloyd Blankfein, chairman and CEO, in a releae. “We continue to benefit from our strong client franchise, a broad and diverse set of businesses and the deep commitment and experience of our people. We are realistic about the market challenges we face, but times of market dislocation also produce opportunities, and we will continue to take advantage of the most attractive of these as they arise.”