Goldman Sachs and Morgan Stanley, with three of their rivals vanquished this year, today vowed to remain independent as Wall Street faces its biggest shake out since the Great Depression hit nearly 80 years ago.

The last two major independent investment houses both posted third-quarter profits despite continued chaos in the financial markets. And, their top brass rejected suggestions they must find partners to survive the ongoing credit crisis.

Global banks and brokerages have written down more than $350 billion from wrong-way bets on mortgage investments and other risky securities during the past year. The upheaval in the American financial system has driven Merrill Lynch & Co. and Bear Stearns Cos. into emergency sales, and Lehman Brothers Holdings Inc. into bankruptcy.

Now, more than ever, analysts are questioning if the stand-alone investment banks that have dominated Wall Street for generations are close to extinction. Eroding investor confidence in the financial industry has prompted questions about whether Goldman and Morgan Stanley need to partner with commercial banks, whose deposits are a more stable.

“You’ve got to get out while the going is good,” a former managing director of Lehman Brothers’ Neuberger Berman unit and founder of money management firm Integre Advisors, Manny Weintraub, said. “Because I think the whole business model of a brokerage firm is broken.”

Commercial banks tend to have slower growth but more dependable earnings since a bulk of the business comes from retail operations. Investment bank earnings are more volatile, and rise or fall on businesses like investment banking and trading.

With Merrill Lynch agreeing to be acquired by Bank of America Corp. and Bear Stearns being bought by JPMorgan Chase & Co., more pressure has come for those left to do similar deals.

However, both Goldman Sachs and Morgan Stanley are demonstrating that they have the business model needed to take advantage of the market’s dislocation and remain independent.

Goldman Sachs today reported its biggest slump since going public in 1999. Still, the larger of the two remaining major American investment banks beat profit expectations despite a 71% decline from last year.

Goldman Sachs posted a profit after paying preferred dividends of $810 million, or $1.81 per share, compared to $2.81 billion, or $6.13 per share, a year earlier. Revenue for the three months ended August 29 skidded 51% to $6.04 billion.

The results beat Wall Street projections for $1.71 per share, according to analysts polled by Thomson Reuters. Revenue fell short of the $6.23 billion expected by analysts.

On a conference call with analysts, the Goldman Chief Financial Officer, David Viniar, was questioned about the investment bank’s viability without doing some kind of deal. He stated clearly that there was no intention to find a partner, refuting speculation that Goldman was interested in taking over a bank such as Charlotte, North Carolina-based Wachovia Corp.

“We cannot stop the rumors and we cannot stop the fear,” Mr. Viniar told reporters during a conference call. “Right now, we think our business model works because our business works. Our performance speaks for itself and will continue to speak for itself.”

His counterpart at Morgan Stanley, Colm Kelleher, made similar comments after the investment bank announced quarterly results one day ahead of schedule. Results were initially scheduled for tomorrow.

“There has been much debate about independence,” he told analysts. “We believe in the diversified business model of an investment bank and ability to adapt to different market environments. That has been proven time and time again.”

Morgan Stanley easily topped Wall Street expectations during the quarter. It used strong results from trading and foreign exchange to offset $640 million in write-downs from its mortgage trading business.

The investment bank reported a profit of $1.43 billion, or $1.32 per share, compared with $1.54 billion, or $1.44 per share in the year-ago period. Thomson Reuters said analysts expected earnings of 78 cents per share. Revenue rose modestly to $8.05 billion from $7.96 billion.

The results, at least for the time being, might put to rest talk that Goldman and Morgan Stanley must find partners to survive. Both investment banks were hounded by similar calls during the past decade when many global banks were created, including UBS AG, Citigroup Inc., and JPMorgan Chase.

“There was a big groundswell that the investment banks couldn’t compete independently,” Mr. Viniar said. “We wouldn’t get through five minutes of a meeting without talking about Goldman Sachs combining with a commercial bank. Well, it feels like we’ve been able to compete just fine.”

Shares in Goldman Sachs slipped $2.11, or 1.6%, to $130.90 in after-hours after the ending the regular trading session down $2.49 at $133.01.

Morgan Stanley gave up 30 cents, or 1.1%, to $28.40 in after-hours. It tumbled $3.49, or 10.8%, to $28.70 during the regular session.