“Goldman can create a special purpose vehicle used to invest in private equity on behalf of clients. Then it can transact derivatives to minimize market and credit risk of those investments; those derivatives could be construed as a hedge for clients. If it is good at documenting that this SPV is segregated from any insured depository accounts, then it will have a good chance of skirting Volcker,” Mayra Rodriguez Valladares, managing principal of MRV Associates said in a Thursday interview.
“It is key to remember that Goldman is still very much a broker dealer with very little FDIC insured bank units. The real concern should be JPMorgan, Citigroup, and Bank of America, not Goldman or Morgan Stanley,” Valladares added.