Time for Goldman to claw back ICBC bonuses?

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In another sign of the changed times, Goldman's formerly lucrative investment in the Industrial and Commercial Bank of China has turned sour.

This time last year, the ICBC stake was widely regaled as one of the key factors behind the Goldman bonus pool.

According to The Times, Goldman made $1.3bn in 2007 from its $2.6bn investment in the Chinese bank.

Now, with Goldman predicted to make a fourth-quarter loss, ICBC has become more albatross than golden goose.

"The value of the Industrial and Commercial Bank of China holding may have been lowered by as much as 30%," pointed out Dick Bove, analyst at Ladenburg Thalmann, in a note this week. He concluded that "The short-term outlook for the company is poor. The intermediate-term outlook is challenging. The long-term outlook is good."

Goldman's ICBC investment was made through its principal finance arm. The perpetrators can therefore expect to receive substantially lower carried interest for their efforts. Any 2007 bonuses related to the increased value of the ICBC stake now look ill-advised. But this being Goldman, clawbacks are unlikely.

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