Goldman Sachs broke Wall Street records yesterday by reporting net profits 50 per cent ahead of analysts' forecasts at $2.48 billion (€2.06 billion) for its first quarter, or $400,000 for each of its 23,600 employees on an annualised basis.

Earnings were up 64 per cent on the same period last year, with a return on assets higher than at the crest of the stock market bubble in 2000.

David Viniar, chief financial officer, said that the growth reflected strong performances across all its businesses, but particularly in Europe and Asia.

While warning that it would "not be able to replicate the performance every single quarter", he said: "For the moment, the business environment remains very favourable."

Return on equity rose to 38.8 per cent, topping the record for a leading investment bank of 36.3 per cent achieved by Morgan Stanley in the first quarter of 2000. Total revenues rose 61 per cent to $10.3 billion, well ahead of the consensus of analysts.

David Trone of Fox-Pitt, Kelton, said: "No one can make a reasonable assessment as to the sustainability of these levels of revenues."

Goldman's shares were up 5 per cent at a new high of $147.67 at noon in New York.

The bank has turned in record earnings in five of the last nine quarters.

The fixed-income division generated revenues of $3.74 billion, 42 per cent above the previous record, helped by volatile energy prices and strong trends in currencies.

Equities trading did even better, with revenue up 94 per cent on last year to $1.6 billion, driven largely by derivatives, particularly in Europe and Asia.

Investment banking revenues jumped 65 per cent to $1.47 billion, but were overtaken by asset management, where revenues doubled to $1.49 billion.