Of clients will be separated from revenue generated

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of clients will be separated from revenue generated by Goldman's own holdings of stock, bonds, real estate and other investments. The change is in part an effort to dispel suspicions that Goldman trades on information it gets from clients and investment- banking deals. In another move to make its operations more transparent, Goldman plans to publish a simplified balance sheet, in addition to the balance sheet it already files to meet accounting standards. The new format will classify the firm's assets by business unit, including cash and liquid securities, and Goldman's funding of hedge funds and derivatives clients. The goal is to make it clearer what business Goldman conducts on behalf of its clients and what are its own investments. The changes also affect how it
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discloses holdings of securities and loans held in the firm's own investment account and private-equity funds. From now on, structured-finance deals like Abacus will be pieced together by Goldman's investment bankers, not traders. Goldman executives want such deals to come from the longtime relationships with clients that bankers are meant to prioritize over short-term trading gains. In the Abacus deal, a Goldman trader created the CDO partly to help a hedge-fund client bet against the housing market. As part of the settlement, Goldman said it made mistakes in its handling of the deal. It will take 15 to 18 months to implement the changes in the report, said Mr. Evans, who will oversee the effort. A permanent version of the committee will be led by Goldman President and Chief Operating Officer Gary D. Cohn. Since Mr. Blankfein announced the panel's creation in May, it has held 17 meetings involving 130 partners and managing directors, said one partner involved in the process.
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  • Spring '10
  • abraham
  • Interest, Goldman Sachs Group Inc., Goldman Sachs Group, Lloyd Blankfein, Goldman executives

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