LONDON (Reuters) - Lansdowne Partners, one of Europe’s biggest hedge fund firms, has sold its $850 million stake in Goldman Sachs (GS.N) as part of a move out of investment banks burdened by regulation and into retail banks, a source close to the situation said.
London-based Lansdowne, which manages $16 billion in assets and which has a large position in Lloyds Bank (LLOY.L), sold its stake in Goldman at the beginning of the year, the source told Reuters on Monday.
The firm’s move was not specifically related to Goldman but instead a call on the investment banking sector and driven by a range of concerns including U.S. financial regulation, the source added.
Goldman’s shares are down 20 percent since the start of the year, in part on worries over the effects of the Dodd-Frank law pushing banks to cut back on proprietary trading and risk taking.
Last month Goldman posted earnings and revenue far below analysts’ already-reduced expectations, while it has also seen high-flying executives such as Pierre-Henri Flamand and Morgan Sze exit in recent years to set up hedge funds ahead of the new rules.
The change in investment strategy comes in a tough year for Lansdowne, which made millions shorting banks during the financial crisis but whose flagship UK fund is down 11 percent so far this year.
Both Lansdowne and Goldman declined to comment.
Reporting by Laurence Fletcher