WARREN Buffett has thrown his weight behind Goldman Sachs and its chairman, Lloyd Blankfein, arguing that the investment bank has a ''place in the universe''.
Buffett, who has run the Berkshire Hathaway conglomerate since 1965, dismissed the recent political and public backlash against Goldman, praising Blankfein and the bank's business model.
In an extended interview with cable business network CNBC, the so-called ''Oracle of Omaha'' said: ''I feel good about their business prospects. It's a very, very strong, well-run business. It's got a place in the universe and there are fewer big investment banks around than there were a few years ago.''
He disclosed that Goldman received a $US35 million ($A39 million) fee for advising Berkshire on its recent acquisition of railway company Burlington Northern Santa Fe.
''I don't like that,'' he said in relation to the size of the fee, ''but they have that sort of market position. Lloyd Blankfein, you cannot find a better manager.''
Buffett said he would still invest in Goldman today, although he said that he would do so only if he were able to again buy the lucrative $US5 billion instrument Berkshire was able to negotiate in 2008, during the financial crisis, which delivers a 10 per cent annual dividend.
Berkshire recently disclosed an annual profit of $US8.1 billion, up 61 per cent on the rising value of its investments and derivatives. The results were accompanied again by Buffett's annual letter to shareholders, in which he said the economy was getting better, ''but at a very, very slow rate''.
The beleaguered board of Goldman Sachs has refused to bow to shareholder demands to investigate its bonus practices.
Investors asked the company to look into its pay and bonus strategy, which last year delivered $US16.2 billion to its 31,700 employees. But following a board meeting, Goldman admitted in a regulatory filing that it did not intend to investigate.
However, it would co-operate with government agencies that have sought information relating to the matter, it said.
The bank has also revealed it is the subject of several shareholder lawsuits that allege that last year's compensation payouts were too high.
To appease its investors, Goldman will hold a non-binding ''say on pay'' vote at its coming annual meeting.
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