Goldman Sachs (GS) Wants to Payback Warren Buffett

Goldman Sachs (NYSE: GS) is seeking to payback the costly $5 billion investment Warren Buffett made in the company during the heart of the financial crisis, the Wall Street Journal reported today.

The September 2008 investment from Buffett gave investors a boost of confidence and allowed the investment bank to raise an additional $5 billion.

The "perpetual" preferred shares that Buffett owns in Goldman carries a heft 10% yield and has cost Goldman about $1 billion in interest payments.

Goldman could replace the costly Buffett investment with cheaper capital. The company's unsecured bonds currently yield between 2% and 6.5%, the Journal noted.

Repaying Buffett would also lift restrictions that prevent CEO Lloyd Blankfein and other Goldman execs from selling more than 10% of their stocks. Buffett requested the stiff rules before agreeing to the investment.

Shares of Goldman Sachs are up 0.4% in pre-open trading today to $160.30.

---

Serious News for Serious Traders! Try StreetInsider.com Premium Free!

---

You May Also Be Interested In

• Warren Buffett: mistake not investing in Google, and the company is now 'more likely to be a winner' based on its record - CNBC interview
• Buffett: "tough to find value" when everyone is gambling
• Warren Buffett donates 12 million Berkshire Class B shares to foundations