Goldman’s Donovan Said to Be Top Contender for Key Treasury Post

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  • If picked would be fourth Trump appointee from investment bank
  • Domestic finance post responsible for bank and market policies

Goldman Sachs Group Inc. banker Jim Donovan is the front-runner to be Donald Trump’s pick for undersecretary of domestic finance, a key position in the Treasury department, according to a person familiar with the decision.

If chosen and confirmed Donovan would be the fourth appointee with ties to the investment bank tapped to serve in the president-elect administration, and would be responsible for coordinating policies on banking, capital markets and regulation, and managing the issuance of the country’s debt.

The person agreed to discuss internal transition deliberations only on the condition of anonymity. Donovan is a managing director at the bank’s private wealth management division and has been with Goldman since 1993.

While Trump derided Wall Street and singled out Goldman Sachs as a symbol of greed during his campaign, he’s tapped a number of the bank’s alumni to help run the government. He picked Steven Mnuchin, a former partner at the bank, to be Treasury secretary and enlisted Goldman Sachs President Gary Cohn for the top White House economic post. Stephen Bannon, another alumnus of the firm, was named chief strategist.

Trump has also said he would nominate Jay Clayton, a partner at Clayton, a Sullivan & Cromwell LLP who has done work for Goldman Sachs, to lead the Securities and Exchange Commission.

Treasuries Market

Should Donovan get the job, he would help oversee the $13.8 trillion market for Treasuries, which is in the midst of a transformation. The dawn of high-speed trading has tested its resilience, and regulators are grappling with how to prevent a repeat of the so-called flash rally of Oct. 15, 2014, when Treasury yields saw an unprecedented, and little-understood, surge.

Donovan was a financial backer of Mitt Romney during the former Massachusetts governor’s presidential run in 2012, and then of Jeb Bush in the 2016 Republican primary. He’s a chemical engineering graduate of MIT, received his masters in business administration from there, and subsequently earned a law degree from Harvard.

The current undersecretary position is vacant after President Barack Obama struggled to win approval for his nominee Antonio Weiss in 2014, who now serves as counselor to the Treasury secretary. Democratic Senator Elizabeth Warren of Massachusetts and independent Senator Bernie Sanders of Vermont opposed Weiss’s nomination due to his ties to Wall Street. Weiss, a former Lazard Ltd. investment banker, spent almost two decades in the financial industry.