Goldman Sachs Would Like to Pay Back Their TARP Money ASAP

Apparently this new rule about caps on executive pay was a motivation to choose other venues.

There are plenty of other feedbags from the Fed for a newly christened commercial bank, and the Fed is more tolerant of highly paid management.


Bloomberg
Goldman Sachs Would Like to Pay Back TARP Money, Viniar Says
By Christine Harper

Feb. 4 (Bloomberg) -- Goldman Sachs Group Inc., which took $10 billion from the U.S. Treasury in October, would like to pay back the money from the so-called Troubled Asset Relief Program, or TARP, said David Viniar, the firm’s chief financial officer.

“It would send a very good signal” if the firm could repay the money, he said. The firm would only do so if it got “the blessing” of the Treasury and Federal Reserve, he said at a Credit Suisse conference in Naples, Florida today.

Under current rules, Goldman and other firms that received money under TARP are required to raise common or preferred equity to replace the government funds, Viniar said. The company will consider raising money “if the markets are good,” he said.

The government investment “is not really restricting the way we do business,” Viniar said.

Goldman will also be “very cautious” about considering any acquisitions because there’s a longer record of unsuccessful deals in the financial services industry than successful ones, Viniar said. He said the firm is likely to maintain its current business of focusing on corporate and institutional clients rather than entering the retail business.

“I would not pick up the Wall Street Journal every morning looking for the big Goldman Sachs acquisition because I think you will be disappointed,” he said. “We don’t really like or know the retail business and I don’t expect that to change too much.”