Ecuador Used Gold Reserves for Goldman Sachs Loan Collateral

Ecuador President Rafael Correa said proceeds from a loan obtained from Goldman Sachs Group Inc. after he offered more than half the country’s gold reserves as collateral will go toward investing in economic growth.

The government, faced with a budget deficit forecast to hit a record this year, said last week that it “invested” 466,000 ounces of gold with Goldman Sachs in return for “instruments of high security and liquidity.” The transaction added to reserves of “monetary gold” and would generate as much as $20 million in profit, according to a central bank statement.