The WSJ has reported that Tim Leissner quit Goldman Sachs after he was ordered to explain an apparent breach of company policy, ie sending "an unauthorized reference letter on behalf of an individual to another financial firm in 2015."
Compare this Mr Leissner's record breaking, reality defying,1 MDB bond deal, where Goldman put together a scheme where it bought unrated bonds from 1 MDB, got them rated as sovereigns ,which they were, and then sold them at a massive profit. Bloomberg provides a summary:
Unrated Bonds
1MDB’s bonds were unrated when Goldman bought them and got an A- grade, the same as on sovereign debt, from Standard & Poor’s on April 12. The sale matched a Petroliam Nasional Bhd. deal in 2009 as the largest by a Malaysian company in the international market, according to data compiled by Bloomberg. It made Goldman the second-biggest underwriter of Malaysian dollar bonds after Citigroup Inc., with 18.5 percent of the market, the data show.
Part of the $500 million came from Goldman buying the notes at a discount to face value before marking them up to sell to investors, said the person familiar with the deal.
Part of the $500 million came from Goldman buying the notes at a discount to face value before marking them up to sell to investors, said the person familiar with the deal.
Najib in blue, Tim Leissner & wife (inset)
Goldman purchased the bonds for 91 cents on the dollar, according to the person. At that price, the notes yielded about 5.6 percent, or 364 basis points more than Treasuries and 261 basis points more than the rate on Malaysia’s sovereign Islamic dollar debt due July 2021. Quasi-sovereign bonds due in seven to 10 years yielded 2.3 percent on average, according to data compiled by Bank of America Corp.
Goldman purchased the bonds for 91 cents on the dollar, according to the person. At that price, the notes yielded about 5.6 percent, or 364 basis points more than Treasuries and 261 basis points more than the rate on Malaysia’s sovereign Islamic dollar debt due July 2021. Quasi-sovereign bonds due in seven to 10 years yielded 2.3 percent on average, according to data compiled by Bank of America Corp.
While it is true that sharp investment bankers like Mr Leissner are very good at picking up mispriced assets, this was clearly a case where all parties involved agreed to pretend that the Rolls Royce was a very ordinary Proton.
One would think that this ,more than some "unauthorized reference letter on behalf of an individual to another financial firm " would be of greater concern, but not it seems at Goldman Sachs.It is obvious that Goldman is finding any excuse it can to break any nexus between its partners and CEO and chairman, Lloyd Blankfein.
- http://realpolitikasia.blogspot.my/
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