Government does not want Goldman Sachs to return bailout funds?

As Goldman Sachs posted on Monday a better-than-expected first-quarter profit and announced the public offering thus showing that it went through the crisis much better than its main rivals the company is likely to consider a pay back of the government’s bailout funds.

Since hitting its lowest level in November Goldman’s share price increased more than two times being up 50% in comparison with the previous year. This makes some observers think that the financial institution will be able to return the $10 billion it took under the U.S. Treasury Department's $700 billion Troubled Asset Relief Program which spurred a lot of stir in the public over compensation, expenses and acquisitions.

However, the desired freedom from the public control will unlikely come to Goldman in the near future inasmuch as given its size and importance to the financial system regulators may still want to keep a close eye on it, said Seamus McMahon, an independent banking and regulatory consultant.

"So the question is, even if they are allowed to do it, how much of a victory is this actually ultimately?" McMahon said. "Is it more marketing or does it really give them operating freedom?"

Besides, it may add to the regulators’ headache as it may cause others to do the same and pay back the taxpayers’ money. Meantime authorities are interested in the industry stability and want to be sure that banks that return the money have enough capital. On the other hand concerns may arise if a two-tier market is created, with Goldman, Wells Fargo & Co and some other banks being seen as strong enough to thrive or survive without government help while others such as Citigroup Inc seen as requiring government nursing.