Report: Goldman Sachs to Take $3 Billion Hit

Goldman Sachs, Wall Street's most powerful investment bank, will this week announce asset writedowns worth about $3 billion, its biggest jolt to date from the crisis threatening to engulf the world's financial markets, according to a report seen on the U.K.-based Telegraph's Web site Monday.

The bank's $3 billion write­down will be based partly on the declining value of its 4.9% stake in Industrial & Commercial Bank of China, which is held separately on Goldman's balance sheet, said the report, adding that the share price of ICBC, which conducted the world's biggest ever initial public offering in 2006, has fallen by about 14% in recent months.

Goldman invested $2.3 billion for its minority shareholding in ICBC, which is listed on the Hong Kong and Shanghai stock exchanges.

Goldman will also take a hit of about $1.6 billion in its leveraged loans business, which has seen a marked decline in recent months amid a dearth in demand for trading bank debt, the report said, noting a further $1.1 billion will be written down in connection with assets owned by Goldman's principal investment area, the bank's private equity arm.

Despite the multibillion dollar hit, Goldman will point to the fact that its exposure to the deteriorating mortgage market remains minimal, according to people close to the bank, said the report.