Goldman Cuts ‘Reasonably Possible’ Legal Losses to $3.5 BillionChristine Harper and Ambereen Choudhury
Goldman Sachs Group Inc., the fifth-biggest U.S. bank by assets, lowered its estimate for potential losses from legal claims by $100 million.
“Reasonably possible” legal costs are as much as $3.5 billion, the New York-based firm said today in a report on the quarter that ended Dec. 31, without giving specific reasons for the decline. That compares with $3.6 billion three months earlier and $3.4 billion at the end of June.
Banks started making public estimates of possible losses after the U.S. Securities and Exchange Commission told finance chiefs in October 2010 that they should disclose such costs “when there is at least a reasonable possibility” they may be incurred, even if the risk is too low to require reserves.
The estimate doesn’t include potential losses from legal matters that are at an early stage or where the firm can’t determine the potential amount, according to the filing.