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Goldman earnings take a tumble

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NEW YORK (CNNMoney.com) — Goldman Sachs’ profit tumbled 82% in the latest quarter, the company said Tuesday, as market turbulence and a recent settlement with the Securities and Exchange Commission kept a lid on results.

Overall, it represented one of the worst performances for the firm since the financial crisis erupted, as the company also took a charge related to the British government’s tax on Goldman’s U.K.-based employees.

The biggest hit was a 40% decline in revenue from trading, hurt by wild market swings May and June.

Other parts of the company’s business didn’t fare well either. Goldman’s traditional investment banking business reported a 36% decline in revenue, as overall stock and debt underwriting activity dried up.

Sales activity declined in Goldman’s asset management and securities services business, although to a smaller extent.

“The market environment became more difficult during the second quarter and, as a result, client activity across our businesses declined,” company chairman and CEO Lloyd Blankfein said in a statement.

Offsetting those declines was a reduction in the amount of money Goldman set aside to pay its famously large employee bonuses at year end. During the quarter, Goldman accrued just $3.8 billion, down from $6.6 billion a year earlier. Staffing levels at the firm rose during the quarter however, as the company added approximately 1,000 employees.

Overall, the company said it earned $613 million, or 78 cents a share, for the quarter, after taking into account the various charges. Just a year earlier, it earned $3.4 billion, or $4.93 a share.

Analysts were expecting the company to earn $1.3 billion, or $2.08 per share, according to Thomson Reuters.

Goldman (GS, Fortune 500) shares were roughly unchanged on Tuesday.

0:00 /2:28SEC: Goldman ‘misled investors’

The company’s latest results come just days after Goldman agreed to pay $550 million to settle the SEC’s charges that the firm defrauded investors in a sale of securities tied to subprime mortgages.

David Viniar, Goldman Sachs’ chief financial officer, was grilled by both reporters and analysts Tuesday for additional details on the agreement.

Viniar declined to elaborate on how the two parties reached the settlement figure or whether the company was still legally vulnerable.

Some have suspected that Goldman may have pushed for terms in its agreement with the SEC that shielded the firm from any additional mortgage-related suits brought by the agency. There have also been speculation that the company’s dealings have been under examination by the Department of Justice.

“We are not aware of any criminal investigation of Goldman Sachs,” Viniar said Tuesday.

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