Gerald Corrigan, a former head of the Federal Reserve Bank of New York, is being tapped by Goldman Sachs to chair its newly created bank holding company, reports the FT. Goldman and rival Morgan Stanley are transforming themselves into commercial banks, a move encouraged by the US government after the autumn collapse of Lehman Brothers. Last week the New York Banking Department announced it had approved the formation of Goldman Sachs Bank USA, which consists of its Utah industrial loan company and various other capital-intensive units such as its loan and mortgage arms. Corrigan’s appointment, expected to be announced soon, comes as speculation mounts over Goldman’s strategic direction in its new incarnation – including whether it will buy another bank to build its deposits more quickly. The firm is shortly expected to post a loss of up to $2.2bn for the fourth quarter that ended last week, its first since going public in 1999, although it is expected to report a gain for the full year.
