In addition to the breach, Goldman Sachs Group Inc. was downgraded by its broker Morgan Stanley, who mentioned "risks and uncertainties" in the investigation of Goldman's role in the 1MDB scandal.
overweight for at least three years. It also reduced its price target by 22% to $ 226, which is now the second-lowest of the 29 analysts surveyed by FactSet, from $ 291.
The downgrade follows after the stock fell 17 percent since Goldman reportedly surfaced Lloyd Blankfein, chairman and former chief executive, met with individuals involved in the 1MDB scandal. He had been charged with conspiracy to launder and steal money from a Malaysian state fund, 1
to have been charged. Do not miss : 2 former Goldman bankers indicted by the Justice Department in the Malaysian 1MDB scandal.
GS, + 1.14%
closed on a 2-year low on Tuesday and has fallen 43% since closing the record at $ 273.38 on March 12. In midday trading increased by 1.4%.
Graseck said the main concerns she had about the potential impact of the 1MDB investigation was how long it would take to solve the problem, what fines and penalties could be and what the costs would be Satisfy supervisory authorities.
"These risks, along with potential headline risks over the coming months – additional litigation, additional regulatory testing and internal reviews – are helping us to be valued equally," Graseck wrote in a note to clients. [19659002SincethemajorityoftheActivitieshavefallenlateinthefinancialcrisis"asignificantincreaseisexpectedtooccur"
Graseck quoted at 7.1x its earnings per share for 2019, well below the 11x average of the past five years and "relatively in line with the financial crisis" of subject.
Reg. Regarding the possible potential penalties, Graseck said Goldman had earned $ 600 million in debt from debt instruments, which would have helped raise $ 6.5 billion for 1MDB. She said that the anti-terror law provisions of the Foreign Corrupt Practices Act allowed fines of up to twice the amount of fees levied in addition to reimbursement of fees.
"However, the final outcome is by no means certain," said Graseck, as Goldman could achieve a reduction in fines or additional fines and penalties for violations of other provisions or statutes.
Goldman shares have fallen 24.2% since the beginning of the year, while the SPDR financials sector has been a listed fund
XLF, + 1.20%
has lost 5.0% and the Dow Jones Industrial Average
DJIA, + 0.48%
fell by 0.4%.