ICBC loses Goldman Sachs investment

US investment firm makes US$1.1 billion by selling remaining ICBC shares.

In ending its seven-year old investment in Industrial and Commercial Bank of China, Goldman Sachs Group, Inc. earned a return of nearly four times its original stake.

Analysts said Goldman’s relationship ICBC helped the Chinese lender become the world's biggest banks. The exit comes at a time when Goldman, like other big Western banks, has shifted its focus on boosting its balance sheet ahead of new capital requirements.

Prior to its 2006 initial public offering, ICBC was a technically insolvent state institution, hurt by the bad loans that crippled China's financial industry. ICBC's fortunes changed for the better after it went public.

Goldman agreed to invest US$2.58 billion in ICBC in January 2006, using internal funds that invest a mix of client, employee and corporate cash. It made US$10.1 billion from its initial investment.