About 40% Goldman Sachs' oil, gas loans to junk-rated companies

[NEW YORK] About 40 per cent of Goldman Sachs' loans in the petroleum sector is to oil and gas companies considered "junk" by credit ratings agencies, according to bank data released on Monday.

Goldman's overall exposure to oil and gas companies stood at US$10.6 billion at the end of 2015, including US$4.2 billion to non-investment grade counterparties, the investment bank said in a securities filing.

Of this sum to junk-rated companies, US$1.5 billion is in loans outstanding and US$2.7 billion in future commitments.

"Significant declines in the price of oil have led to market concerns regarding the creditworthiness of certain companies in the oil and gas industry," Goldman said.

The banking industry's exposure to the oil rout was a major source of worry when large banks reported earnings last month.

Goldman Sachs on January 20 reported 2015 net income of US$6.1 billion on US$33.8 billion in revenues, which came in 2.1 per cent lower than a year ago.

AFP