The rest of the market thought otherwise but Goldman has another interpretation.
Goldman will continue making principal investments with the firm’s own money because executives don’t think the so-called Volcker rule prevents the practice, a Bank of America Corp. analyst said. The analyst, Guy Moszkowski, published a note to investors today after meeting last week with four Goldman Sachs executives in Hong Kong. New York-based Goldman Sachs doesn’t think U.S. legislation passed last year that bans proprietary trading and limits holdings in hedge funds and private-equity funds precludes buying stakes in companies and other assets, Moszkowski wrote.
“The market interpretation of Volcker rules is that this will be off-limits ahead, but GS believes that many such investments will remain permissible, and will be closing on a ‘meaningful’ one in China shortly,” Moszkowski’s note said.
The investment is in Taikang Life Insurance, with a 12.02 percent stake. Thank you, Pedro!