Operator: Good morning. My name is Denise and I will be your conference facilitator today. I would like to welcome everyone to the Goldman Sachs's Third Quarter 2012 Earnings Conference Call. After the speakers' remarks, there will be a question-and-answer period. Also, this call is being recorded today, Tuesday, October 16, 2012.
Thank you, Mr. Holmes. You may begin your conference.
Dane E. Holmes - IR: Good morning, this is Dane Holmes, Director of Investor Relations at Goldman Sachs. Welcome to our third quarter earnings conference call.
Today's call may include forward-looking statements. These statements represent the Firm's belief regarding future events that by their nature are uncertain and outside of the Firm's control. The Firm's actual results and financial condition may differ, possibly materially, from what is indicated in those forward-looking statements. For a discussion of some of the risks and factors that could affect the Firm's future results, please see the description of Risk Factors in our current Annual Report on Form 10-K for our fiscal year ended December 2011.
I would also direct you to read the forward-looking disclaimers in our quarterly earnings release, particularly as it relates to our Investment Banking transaction backlog, capital ratios, risk-weighted assets, and global core excess, and you should also read the information on the calculation of non-GAAP financial measures that is posted on the Investor Relations portion of our website at www.gs.com.
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Our Chief Financial Officer, David Viniar, will now review the Firm's results with Harvey Schwartz, who will assume David's role at the end of January. David?
David A. Viniar - EVP and CFO: Thanks Dane. I'd like to thank all of you for listening today. I'll give an overview of our third quarter results and Harvey will review our business performance.
Net revenues were $8.4 billion, and net earnings were $1.5 billion. Earnings per diluted share were $2.85, and our annualized return on common equity was 8.6%. Year-to-date, our annualized return on common equity was 8.8%.
The third quarter operating environment included continuing concerns about the outlook for the global economy particularly as it relates to the situation in Europe. The uncertainty surrounding economic prospects has weighted on the psychology of corporate leaders and investors negatively impacting the current operating environment in two principal ways.
Corporate client activity continued to be relatively weak in the third quarter. Industry-wide announced M&A volumes declined 16% sequentially and IPO volumes were nearly cut in half. In addition, New York Stock Exchange volumes were down 13% sequentially, while LSC volumes were down 23%. An additional impact of economic uncertainty and weak investor conviction, there is the tendency for investors to transact in the most liquid and commoditized portion of the market. These dynamic is evidenced within both the FICC and equities franchises and as demonstrated by the significance of index product volumes in credit and equities.