UPDATE 2-Goldman sees bank buy unlikely, analyst Whitney says
(Adds analyst comments, background, byline; updates share price)
By Tenzin Pema
BANGALORE, July 30 (Reuters) - Goldman Sachs Group Inc (GS.N: Cotización) management was quoted by analyst Meredith Whitney as saying that the largest U.S. securities firm was "highly unlikely" to buy a retail bank given current regulation, and that current market environment posed strong headwinds to earnings growth.
"While much speculation has been made about Goldman's interest in acquiring a retail bank, we believe the chances are less than slim," the Oppenheimer & Co analyst wrote in a note to clients.
On Tuesday, analyst Whitney met with Goldman's Chief Financial Officer David Viniar, Co-President Jon Winkelried, and Head of Investment Banking David Solomon.
"Management stated that the company would only be interested in purchasing a bank if it was able to use the acquired deposits as a funding source for any other part of the business and without additional regulatory scrutiny," Whitney said.
"Obviously, current regulation makes that scenario impossible," she added.
Goldman did not immediately return a call seeking comment.
The credit crunch has prompted analysts and investors to speculate that Goldman, eager to establish a new and more stable source of funds, would snap up a bank. Continuación...