Goldman Sachs (GS) had a pretty slow first quarter.

Revenue plunged 40% year-over-year to $6.34 billion. This was worse than the $7.11 billion expected by analysts. Earnings per share plunged 56% to $2.68, however that bottom line was better tahn the $2.48 expected.

"The operating environment this quarter presented a broad range of challenges, resulting in
headwinds across virtually every one of our businesses," CEO Lloyd Blankfein said."

The numbers were ugly

Goldman's investment banking revenues fell 23% to $1.46 billion.

"Net revenues in Financial Advisory were $771 million, 20% lower compared with a strong first quarter of 2015, reflecting a decrease in completed mergers and acquisitions transactions," management said. "Net revenues in Underwriting were $692 million, 27% lower than the first quarter of 2015, due to significantly lower net revenues in equity underwriting, reflecting low levels of industry-wide activity during the quarter."

Fixed income, currency, and commodites trading revenues plunged 47% due to "a challenging environment characterized by economic uncertainty and difficult market-making conditions."

Equities trading fell 23% due to "economic uncertainty, which contributed to higher levels of volatility and generally lower global equity prices."

For Goldman's bankers, this also means smaller bonuses. Compensation expenses for the quarter was $2.66 billion, down 40% from the same period a year ago.

Investment banking and trading revenues collapsed across Wall Street

JPMorgan (JPM), Bank of America (BAC), Citi (C), and Morgan Stanley (MS) echoed Goldman's woes.

"We expect that trading results in the first quarter will show that the poor trading environment that plagued the second half of 2015 continued into 2016," KBW analyst Frederick Cannon said earlier this month. "As a result, we expect the group to post the worst first-quarter trading revenues since the financial crisis."

And that poor trading environment makes it that much more difficult for investment bankers to close deals.

"We expect investment banking revenues to be weak this quarter, mainly due to continued market volatility that froze capital markets activity—particularly in equity capital markets (ECM) where initial public offering (IPO) volumes declined more than 67% year-over-year (Y/Y)," Cannon said.

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Sam Ro is managing editor at Yahoo Finance

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