UPDATE 3-Goldman denies CNBC report of 'emergency' meeting
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By Joseph A. Giannone
NEW YORK, Feb 12 (Reuters) - Goldman Sachs Group Inc (GS.N) denied a CNBC television report on Thursday that it had convened an "emergency" meeting of top investors earlier this week, prompted by worries Treasury Secretary Tim Geithner's bank rescue plan was not viable.
A Goldman spokesman said the bank invited 30 private equity and hedge fund firms to a dinner Tuesday, a routine gathering for investment banking clients. The event, hosted by veteran investment banker Milton Berlinski and Goldman co-President Gary Cohn, was scheduled three weeks ago.
Attendees also heard a presentation by Jim O'Neill, the bank's chief economist.
"There was no secret, emergency meeting to discuss the Geithner plan," Goldman spokesman Lucas van Praag told Reuters. "We clearly could not have called a meeting. We'd need to be psychic."
In an emailed statement, Goldman added: "Three weeks ago, we issued an invitation to a large group of our investing clients to discuss market conditions, including a presentation on the macroeconomic environment. The fact that the dinner took place on the same day as the Treasury Department's announcement was a coincidence."
Earlier on Thursday, CNBC on-air editor Charles Gasparino reported that Goldman had convened 20 large investment firms for an "emergency discussion" of the Geithner plan within hours of the plan's presentation to the public.
Attendees of the Goldman dinner expressed worries about the plan and suggested alternatives for reviving the financial markets, Gasparino reported on CNBC. The report continued that Goldman would produce a white paper laying out the firm's own plan for reviving the markets.
Goldman declined to comment on what was discussed, but insisted the report distorted the meeting's purpose.
"He was completely wrong. The spin was wrong. The facts are wrong. The implications of what he's suggesting are also wrong," said van Praag.
Even so, private-equity industry sources familiar with the discussion told Reuters the firms in attendance welcomed the direction of Geithner's plan, but they remain "cautious" as they await more details.
Investors in particular expressed their support for such government proposals as adding leverage to the system, providing backstop guarantees and allowing private firms to purchase assets, the sources said.
"It was a wide-ranging conversation, led mostly by Goldman Sachs' economist," said a person briefed by one of the attendees. "It was not a "Geithner" conversation per se -- it was more far-reaching and broad than that."
"There were no assignments or action items that I'm aware of as it wasn't that kind of gathering -- it was business/social event, a group of colleagues and GS clients."
Since the plan's unveiling on Tuesday, financial stocks have been under pressure because many investors complained Geithner failed to provide enough specifics on how the plan would revive debt markets. (Additional reporting by Jennifer Ablan and Megan Davies; editing by Jeffrey Benkoe and Andre Grenon)
