Goldman vs. the government on TARP funds

April 14, 2009 | By Jim Kim

We've noted that Goldman Sachs' move to repay TARP funds quickly has the potential to really shake up the industry. Certainly it has the power to alter perceptions about specific banks. Which is why the Treasury Department has some big misgivings on Goldman's plans to repay the TARP funds quickly, Reuters reports.

We've said all along that a mass move by banks to repay the funds--and Goldman Sachs' move could force other banks to consider following suit--could separate the winners from the losers in the minds of many, and that may not be fair. Certainly, Citigroup and Bank of America are not in a position to follow suit. A premature move to do so could prove disastrous. What's really interesting is Goldman's aggressiveness. They know that Treasury has big reservations but it is proceeding anyway. So the ball is now in Treasury's court. Will it allow the bank to repay the funds soon? Stay tuned.

For more:
- here's a Reuters article