By Justin Baer
Goldman Sachs Group Inc. raised the top end of its range of
"reasonably possible" legal expenses to about $5.9 billion, the
Wall Street firm said Monday in a regulatory filing.
The estimate, which tracks potential losses above what already
was set aside in reserves, was at about $3.8 billion in May.
In the same filing, Goldman said it was in talks with U.S. and
state authorities to resolve claims stemming from the firm's sales
of mortgage bonds headed into the financial crisis.
"A resolution," the firm wrote in the filing, "may result in
significant penalties and other costs."
Goldman had set aside $1.45 billion during the second quarter in
legal provisions to account for the potential settlement.
Many of Goldman's peers, including Morgan Stanley, have struck
multibillion-dollar agreements to settle similar claims. Morgan
Stanley had reached a preliminary, $2.6 billion settlement in
February, and Goldman's deal is expected to cost a similar amount,
people familiar with the matter have said.
Goldman said in the filing that it had resolved in June a
class-action lawsuit filed by buyers of mortgage securities it
underwrote. The firm agreed to pay about $270 million, people
familiar with the matter said.
Goldman's traders posted losses on eight days during the second
quarter, up from five losing days during the first three months of
2015.
The firm's net trading revenues exceeded $100 million on six
days. During the first quarter, Goldman's traders hit the $100
million mark 22 times.
Write to Justin Baer at justin.baer@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires