Goldman Sachs Group Inc. said about 40% of its loans and lending commitments to oil and gas companies are to junk-rated firms.
The figure, which counts both loans made and future promises to lend, accounted for $4.2 billion of a total $10.6 billion as of the end of December, the New York-based bank said Monday in its annual regulatory filing. Goldman Sachs has $1.5 billion in loans to energy companies rated below investment grade and $2.7 billion in unfunded commitments.
The total exposure jumps $1.9 billion counting derivatives and other receivables, which were “primarily” to investment- grade firms, Goldman Sachs said.
Concerns about banks’ energy loans have helped spur share declines for lenders after the price of oil fell 42% in the past 12 months through Friday. The Standard & Poor’s 500 Financials Index slumped 13% in the same period.
Goldman Sachs’s total is below some of its biggest competitors. Citigroup Inc.’s funded and unfunded commitments amounted to $58 billion, analysts at Susquehanna Financial Group LLP wrote in a note last week. Most of Wells Fargo & Co.’s $17 billion in outstanding energy loans is for companies that aren’t investment grade, Chief Financial Officer John Shrewsberry said last month.
— Check out Energy Crash: Is It Time for Investors to Jump In? on ThinkAdvisor.