Goldman Sachs – Opportunità e sfide per le Multinazionali
italiane operanti in Cina
Milano, 26 Giugno 2014 This material is provided for educational purposes only and should not be construed as investment advice or an offer or solicitation to buy or sell securities. For use of attendees of the GSAM client
roundtable Italy only - Not for further distribution to the general public.
Global Liquidity Management
Jason Granet – Global Liquidity Management
Queenie Siu – Global Liquidity Sales - APAC
1
Table of Contents
I. Chinese Debt Market Overview
II. Macroeconomic Outlook & Liquidity Condition in China
III. Liquidity Management Strategies in China
IV. How Goldman Sachs manages liquidity on behalf of Corporate clients
Appendix
3
Chinese Debt Market Overview
China has two bond
markets:
The inter-bank bond
market is regulated
by PBOC.
The exchange bond
market is regulated
by CSRC.
1 PBoC: People’s Bank of China. CFETS: China Foreign Exchange Trade System & National Interbank Funding Center. CDC: China Government Securities Depository Trust Clearing Co. Ltd.
CSDCC: China Securities Depository and Clearing Corporation. SHSE/SZSE: Shanghai / Shenzhen stock exchange. CSRC: China Securities Regulatory Commission.
Chinese Debt Market Overview
PBOC¹
CSRC¹
Listing Trading
Registration/
Custodian
Registration/
Custodian/
Clearance/
Settlement
CFETS¹
CDC¹
Listing Trading
CSDCC¹
SHSE/SZSE¹
Inter-bank Market Exchange Market
Bond
Issuers
Bond
Investors
4
Debt Market Instruments Including Target Investments for
Money Market Funds
Maturity Profile
High quality local money market funds1 concentrate their investments in Ministry of Finance Bonds,
Central Bank Notes, Policy Bank Bonds and Repos.
Outstanding Amount Breakdown (Bn USD)
1 High quality local money market funds are money market funds rated as AAA by one or more international ratings agencies.
2 MoF: Ministry of Finance. Data as of 1 May 2014. Source: www.chinabond.com.cn.
Policy Bank Bonds by the China Development Bank are currently being issued on a trial basis in the exchange market.
Chinese Debt Market Overview
Inter-bank
Market
Exchange
Market
Central Bank Notes
Policy Bank Bonds
Financial Bonds1
Commercial Paper
Securitized Products
Medium Term Notes
MoF2
Bonds
Enterprise
Bonds
Repos
Corporate
Bonds
Convertible
Bonds
Policy Bank
Bonds 1,779
MoF Bonds 1,439
MTN 495
CP 259
Others 392
<1y 15%
1 to 3y 24%
3 to 5y 23%
5 to 7y 14%
7 to 10y 13%
>10y 11%
Corporate Bonds 119
Local Government Bonds 139
Enterprise Bonds 425
Central Bank Notes 90
5
China's Debt Market: Large and Liquid
Domestic Bonds Outstanding
The Chinese bond market is the world’s third largest bond market and continues to grow rapidly. Size = 3.98 Trillion USD (as of Sep 2013)
Deep, liquid market. Trading volume in 2013 = 43 Trillion USD
Fast Growth of Secondary Market Trading Activities
Chinese Debt Market Overview
Source: Bank for International Settlement, As of Sep 2013 Source: WIND, As of Jan 2014
0
4
8
12
16
20
24
28
Tri
llio
ns U
SD
0
5
10
15
20
25
30
35
40
45
Tri
llio
ns U
SD
Repo
Central Bank Note
Government Bond
Policy Bank Bond
Other
Local Government Bond
6
Rapid Increase in Primary Market Issuance
As China’s economy
has grown, the country
has developed a large
and increasingly diverse
market that includes
both public and private
debt
Central bank notes and
Ministry of Finance
bonds account for the
majority of primary
issuance volume over
the past decade while
the non-government
sector continues to
grow
Issuance Volume and Composition1
Source: China Bond. As of Jan 2014
1 Policy Bank Bonds by the China Development Bank are currently being issued on a trial basis in the exchange market.
Chinese Debt Market Overview
0
1
2
3
4
5
6
7
8
9
10
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Tri
llio
ns C
NY
MOF Bond
Local Government bond
Central Bank Note
Policy Bank Bond
Enterprise Bond
Corporate Bond
Medium Term Note
Commercial Paper
Other
8
Key Views
Activity continues to slow:
• Slower pace of credit expansion since mid-2013
• Industrial sector overcapacity
• Issues in the Property sector (excessive inventory, developer leverage, falling confidence)
A meaningful recovery in 2014 looks unlikely – to stabilise it requires:
• Improvement in global demand
• More substantial policy response and soon
Policy – a significant response feels unlikely:
• New leaders remain committed to addressing structural issues within the Party and Economy
• Vested interests appear to have a diminishing voice
• Greater appreciation of the capacity of the financial system and its associated risks
• The focus on targeting GDP growth is being gradually reduced
Reform – “Internal” focus to remain, broader areas to remain slow and drawn out
Risk – Financial System issues remain critical:
• Corporate sector leverage and working capital pressures continue to worsen
• Slowing activity is pressuring cash flow dynamics and borrowing costs remain high for problematic industries
• Significant maturity schedule is approaching as are seasonal periods of tighter liquidity
The economic and market forecasts presented herein have been generated by GSAM for informational purposes as of the date of this presentation. They are based on proprietary models and there can be no assurance that
the forecasts will be achieved. Please see additional disclosures at the end of this presentation.
9
GDP Breakdown Real GDP is being supported by the deflator…and a surge in consumption…
GDP GDP Contribution Breakdown
Source: GSAM, CEIC, Bloomberg
Deposit
50.0%
10
Shadow Banking has Grown Rapidly and with it, so Has
Moral Hazard…
The Size of Shadow Banking
has Accelerated from 2008
Consumer Perceptions Highlight
Growing Moral Hazard
In Case the WMPs Go Wrong,
What Would You Expect from Commercial Banks?
Source: LHS – PBOC, Wind, Gao Hua Securities, RHS – Credit Suisse Chinese Whispers Survey.
Liquidity Condition in China
4
46
40
10
3
68
26
3
0
10
20
30
40
50
60
70
80
A. Do nothing B. Help to recoup the loss
C. Pay back as deposits
D. Others
Jan Jul
11
In March 2013, the CBRC introduced new regulations on the
issuance of wealth management products
New legislation around Wealth Management Product (WMP) Credit Securitisation introduces:
Matching requirements: banks should match each WMP product with specific underlying assets rather than with an underlying
pool of portfolio assets
Maximum levels of WMP invested in illiquid assets: Illiquid Assets should not exceed 35% of total WMP balances or 4% of total
assets in the previous year.
Disclosure requirements: Banks should disclose to customers the borrower and project information related to Credit Investments
of WMPs, and should not provide explicit or implicit guarantees or repurchase agreements
Banks need to meet these requirements by the end of 2013, or face more stringent capital requirements
For illustrative purposes only. Source: Company data, Gao Hua Research Estimates
Liquidity Condition in China
12
A Liquidity Crunch more Severe than Previous Episodes
Interbank Repo Rates Spiked to a Historical High in June
Seasonal factors typically drive money
market rates higher at important balance
dates as well as ahead of the Chinese
New Year.
However, this year there were several
additional factors that caused a more
severe and longstanding liquidity crunch:
External liquidity supply slowed in May
following the SAFE (State Administration
of Foreign Exchange) strengthening
controls on capital inflows in early May.
CBRC strengthening regulations on
banks’ WMPs, necessitating banks to
require more cash reserves at the end of
June.
The PBoC refrained from injecting
liquidity into the market until 20 June,
which added to uncertainty and drove
cash-hoarding by participants.
Source: GSAM, JP Morgan, UBS.
Liquidity Condition in China
0%
2%
4%
6%
8%
10%
12%
Jan-12 Apr-12 Jul-12 Oct-12 Jan-13 Apr-13 Jul-13
o/n repo 7d repo
13
Tight Interbank Credit Conditions Spilled Over to the
Real Economy
1Y MoF Bond Rates
The liquidity crunch spilled over into the real economy:
A simultaneous surge in discounted bill rates interrupted short term financing for the corporate sector and contributed to a mid-
year slump in economic activity
The challenges liquidity environment dampened the credit creation process resulting in a marked slowdown in the pace of total
social financing
Total Social Financing
Source: GSAM, JP Morgan, UBS.
Liquidity Condition in China
14
The Competition for Liquidity Impacted the MMF Industry
MMF Industry AUM (RMB bn)
The Liquidity Crunch impacted the MMF industry in China
A sharp but temporary fall in Industry AUM was driven by Local style MMFs aligned with Chinese Banks
The challenging liquidity conditions may have threatened NAV’s for Local style MMFs operating under very broad investment
guidelines
Yield Outcomes across MMFs Varied Wildly
Source: Asset Management Association of China.
Liquidity Condition in China
0
100
200
300
400
500
600
Jan-13 Feb-13 Mar-13 Apr-13 May-13 Jun-13 Jul-13 Aug-13
2%
3%
4%
5%
6%
7%
8%
30-Apr 31-May 30-Jun 31-Jul 31-Aug
Fitch AAA MMF 1
Fitch AAA MMF 2
Local MMF 1
Local MMF 2
15
Implications from the Liquidity Crunch
A few challenges highlighted by our clients are:
I. Breakdown of bankers acceptance discounting:
– Surge in discount rates
– Credit discrimination (large vs. small banks)
II. Difficulties in moving money from incumbent banks
– “Persistent” marketing to encourage rollover
– “Technical” delays/challenges
III. Funding, i.e. “Are committed banking facilities in China really 'committed'?”
Client considerations:
Is the optimal level of primary liquidity higher?
To what extent can local banking relationships be consolidated?
Liquidity Condition in China
17
Global Themes Impacting Liquidity Management in China
The Environment Today
Treasurers have been focusing on the counterparty risk and implement robust review of the credit quality of the
banks’ counterparty limit and investment instruments.
Economic slowdown in China which might impact the liquidity cycle of the retail industries, hence, treasurers
have been emphasizing the needs of liquidity, transparency of investment.
Increasing trend of parking surplus RMB in high quality money market funds as a safe instrument.
Treasurers are focusing on the development of the cross-border RMB pooling and Shanghai Free Trade Zone
pilot schemes.
China’s shadow banking sector faces a spike in default risk in early 2015 as trust funds run up against
repayment deadlines, corporate treasurers emphasize the need of transparency and liquidity of investment
portfolio on money market funds and the credit rating of international AAA-rated.
The economic and market forecasts presented herein have been generated by GSAM for informational purposes as of the date of this presentation. They are based on proprietary models and there can be no assurance that
the forecasts will be achieved. Please see additional disclosures at the end of this presentation.
18
Implement
investment strategies
to align risk tolerance
3
How do MNCs Manage Cash in China? Key Things to Consider
Liquidity Management Strategies in China
Identify liquidity
requirement
1
Formulate investment
objectives
2
Capital preservation
Yield enhancement
Risk diversification
Credit quality
Counterparty limit
Eligible investment
types
Primary liquidity
Secondary liquidity
Tertiary liquidity
Investment solutions ranging from money market funds, bank deposits, bonds,
wealth management products, separate-managed account
19
Liquidity Management Options in China
Liquidity Management Strategies in China
Money Market
Funds
Bank Deposits
Wealth Management
Products
Entrusted Loans
Ultra-high quality money market funds with international AAA-rating, highly transparent and liquid
Local Chinese money market funds
PBOC regulated traditional bank deposits (overnight, 7-day, 1-month, 3-month, 6-month)
Structured deposits with index-linked or tenor-linked
Highly structured, non-transparent short term investments that are managed “off-balance-sheet”
by banks
A lending product which offer companies with idle funds the chance to earn interest by allowing
the agent bank to loan the funds out, while still letting the companies choose whom the agent
bank lends the funds to
Alternative
Solutions
Direct investment in bonds
RMB Separate-manage account
20
Cash Management Instruments: Liquidity & Yield Comparison
Source: WIND, PBoC. As of 1 May 2014.
Past performance does not guarantee future results, which may vary.
Chinese Debt Market Overview
Type of Tool Liquidity Current Yield
Regulated Rates
Current Deposits High 0.35%
Call Deposits (1 day) High 0.80%
Call Deposits (7 day) Medium 1.35%
3 Month Fixed Deposits Low 2.60%
Unregulated Rates Structured Deposits Low Variable
Securities Market Rates
ON/7d Repos at Exchanges High 3.0% to 3.5%
3 month Policy Bank Bonds Medium 4.3%
3 month Ministry of Finance Bonds Medium 3.2%
Money Market Funds High Quality RMB MMF
(International AAA-rated Funds) High
3.5% to 4.0%
21
Corporate Treasurers Feedback of Investing in High Quality
RMB Money Market Funds in China
Stability of principal
The overriding objective is preservation of capital
Flexibility over access to cash investments
The high quality RMB money market fund provides daily liquidity with T+2 settlement
Diversification of investments
A portfolio approach is prudent as risk is spread across many high quality individual positions and credits
Expert portfolio management and superior yield potential
Our approach combines thorough credit research and active yield-curve positioning to generate maximum yield
potential
Significant time saving
Reduces the need for treasury teams to maintain relationships and frequently liaise with a range of individual
banks
Minimises requirement for extensive credit research within treasury teams
Liquidity Management Strategies in China
Investing in the high quality RMB money market funds offers a variety of benefits for liquidity
management, as well as advantages over traditional methods.
23
Managing Risk
The portfolio risk management process includes an effort to monitor and manage risk, but does not imply low risk
Chinese Debt Market Overview
1. Market Risk
2. Liquidity Risk
3. Credit Risk 4. Political Risk
5. Operational Risk
Volatility
Correlations
Stress testing
Profit and loss
Ability to transact
Bid/Offer spreads
Counterparty risk
Corporate risk
Financial institution risk
Sovereign risk
Policy implementation
Timeliness
Internal systems
Internal process
People
24
Investment Process Summary
GSAM’s 30-year track record is based upon key processes that are the cornerstone of our money market
portfolio management
1 The portfolio risk management process includes an effort to monitor and manage risk, but does not imply low risk. Beijing Gao Hua Securities Company Limited (“Gao Hua”), a strategic partner of
Goldman Sachs, is a securities company in China licensed by the China Securities Regulatory Commission (“CSRC”) to conduct, amongst others, client asset management business. Gao Hua
Asset Management (“GHAM”) is a department of Beijing Gao Hua Securities Company Limited (“Gao Hua”). Gao Hua Asset Management (“GHAM”) leverages the resources of Goldman Sachs
subject to applicable regulations and Chinese Wall restrictions. The investment team includes portfolio managers and traders for both the collective investment scheme and separate accounts.
According to regulatory requirements, one person cannot be the portfolio manager for both collective investment scheme and separate account simultaneously.
Credit Risk
Analysis Step 1
Step 2
Step 3
Step 5
Step 4
Liquidity
Analysis
Portfolio
Strategy Meeting
Yield Curve
Optimisation
Credit Review
Security
Selection
Interest Rate
Risk Analysis
Money Market Risk Management1
Management of these three risks lies at the core of the
investment process
Independent Credit Analysis & Review
GHAM leverages the expertise of Goldman Sachs Credit
Department’s independent credit analysis and review
Security Selection
Portfolio decisions are implemented subject to credit and
market liquidity constraints
Optimum Curve Exposure
Incorporate liquidity issues with strategic view to
determine optimal curve exposure
Weekly Portfolio Strategy Meeting
The portfolio management team meet on a weekly basis
to discuss strategy and portfolio composition
25
Potential Benefits of a Partnership with GSAM We believe Goldman Sachs Asset Management is Uniquely Qualified to Provide a Full
Range of Services to Multinational Balance Sheet Clients
Balance Sheet Expertise
Long-term commitment to corporate clients
Proven 30+ year track record in managing liquidity
solutions for multinational corporations
Customized solutions to address complex challenges
Understanding of industry dynamics and implications for
balance sheet management
One of the Leaders in Risk Management
Every step of the investment process; every level of
the firm
Proprietary risk systems combine market expertise and
leading technology
Multiple levels of oversight – PM teams, divisional risk,
firmwide management, compliance and legal
Independent operational support and control teams
Client Focus
We work as an extension of your team
Seek to support all your investment demands
Direct access to PMs, strategists and economists
Daily portfolio and market insights
Accurate and efficient execution and reporting
Breadth of Investment Capabilities
Innovative strategies and deep insights
Robust liquidity management platform
Full range of asset class offerings, including cash
management, fixed income and opportunistic strategies
Access to GSAM and GS & Co. resources and market
information
GSAM leverages the resources of Goldman Sachs & Co. subject to Chinese Wall restrictions.
We tailor GSAM’s investment, strategy and service capabilities to the unique needs of
multinational corporations
Corporate Information
27
Goldman Sachs in China Strategic Partnership: Gao Hua and Goldman Sachs
QFII – Qualified Foreign Institutional Investor
For illustrative purposes only 1 Goldman Sachs Asset Management International subsequently received approval for a US$200 million quota for QFII in 2005. 2 Awarded by Asia Asset Management magazine in January 2012. Beijing Gao Hua Securities Company Limited (“Gao Hua”), a strategic partner of Goldman Sachs, is a securities company in
China licensed by the China Securities Regulatory Commission (“CSRC”) to conduct, amongst others, client asset management business. Gao Hua Asset Management (“GHAM”) is a department
of Beijing Gao Hua Securities Company Limited (“Gao Hua”). Gao Hua Asset Management (“GHAM”) leverages the resources of Goldman Sachs subject to applicable regulations and Chinese
Wall restrictions. The investment team includes portfolio managers and traders for both the collective investment scheme and separate accounts. According to regulatory requirements, one
person cannot be the portfolio manager for both collective investment scheme and separate account simultaneously. There is no representation or warranty as to minimum return derived from the
investment, and a loss of principal is possible.
Corporate Information
1998 2001 2003 1994 2004 2009 2010 2011 2012
Goldman Sachs
opened
representative
offices in Beijing
and Shanghai
The acronym “BRICs”
was coined by the former
Chairman of Goldman
Sachs Asset
Management Jim O'Neill
in a paper entitled
"Building Better Global
Economic BRICs”
Goldman Sachs Gao Hua
(GSGH) was established
as a joint venture between
Goldman Sachs and
Beijing Gao Hua Securities
Company Limited, a full
service domestic securities
company
Beijing Gao Hua
Securities Company
obtained regulatory
approval to conduct
collective investment
scheme and separate
account businesses
Beijing Gao Hua
Securities
Company
launched the
Gao Hua RMB
Money Market
CIS
Beijing Gao Hua
Securities
Company
launched its first
CIS and
separate
account
business
Former Chairman and
CEO Henry M. Paulson
Jr. became the founding
Chairman of the Advisory
Board of the Tsinghua
University School of
Economics and
Management in Beijing
Goldman Sachs
received approval for a
US$50 million quota for
QFII1 under the 1st
batch of QFII quotas
Beijing Gao Hua
Securities Company
obtained the Asset
Management license
Beijing Gao Hua
Securities Company’s
QIS product wins
award for “Most
Innovative Product
China”2
Goldman Sachs
Beijing Gao Hua or Goldman Sachs-Gao Hua
28
Global Reach with Local Resources
Corporate Information
US
dollar
Euro
British
pound
Renminbi
Japanese
yen
Australian
dollar
Our global presence and local expertise enables GSAM to offer liquidity management solutions
in multiple currencies
29
New York
London
Beijing
Melbourne
Salt Lake
Chicago
Mumbai
Bangalore Singapore
Global Liquidity Management Team
Appendix
US Portfolio Managers Short Duration Portfolio
Managers Product Management
Brian Campbell (VP)
Portfolio Manager
(15)
Richard Mulley (VP)
Portfolio Manager
(10)
Beijing Gao Hua1
Lily Li (VP) Portfolio Manager
(16)
Harry Huang (VP)
Trader
(5)
Dave Fishman (MD) & James McCarthy (MD)
Co-Heads of Global Liquidity Management
(26) & (27)
Danny Burke (VP)
Portfolio Manager
(28)
Andrew Lontai (VP)
Portfolio Manager
(13)
Jemma Clee (VP)
EMEA Portfolio Manager
(10)
Credit / Municipal Government / Funding EMEA / Funding
Assistant Portfolio Managers
Paul Devine (VP)
Assistant Portfolio Manager
(16)
Ryan Aluce (AS)
Assistant Portfolio Manager
(7)
Asia
Jason Granet (MD)
Head of Global Liquidity
Management - EMEA
(14)
Shaun Cullinan (VP)
Portfolio Manager
(11)
Pat O'Callaghan (VP)
Portfolio Manager
(19)
John Olivo (VP)
Global Head of Short Duration
(19)
Tory Hinton (VP)
(22)
Christian Kypreos (VP)
Assistant Portfolio Manager
(9)
Sabriyah Denham (VP)
Portfolio Manager
(10)
Siddharth Deb (VP)
Portfolio Manager
(8)
Kristin Pruzinsky (VP)
(8)
Huw Roberts (VP)
(11)
Tarun Kasuganti (AS)
(5)
Stephanie Pinda (AS)
Assistant Portfolio Manager
(4)
Scott Gilbert (VP)
US Portfolio Manager
(10)
Subash Pillai (VP)
Head of Global Liquidity
Management - Asia
(17)
International Portfolio Managers
Kyle Evans (AS)
(4)
Derek Fin (AN)
(4)
Bob Leggett (VP)
US Portfolio Manager
(26)
Jasvinder Gill (AN)
(3)
Kolbe Irving (VP)
Portfolio Manager
(10)
JJ Chua (AS)
(6)
Adam Pennacchio (VP)
Portfolio Manager
(9)
Chloe Giraut (AN)
Assistant Portfolio Manager
(1)
Ryan Aluce (AS)
Assistant Portfolio Manager
(7)
As of May 2014
MM: Money Market
EMEA: Europe, Middle East and Africa.
Numbers in parentheses (x) indicate years of investment experience, as of May 1, 2014. 1 Beijing Gao Hua Securities Company Limited ("Gao Hua"), a strategic partner of Goldman Sachs, is a securities company in China licensed by the China Securities Regulatory Commission to
conduct, amongst others, client asset management business. Professionals listed under “Beijing Gao Hua” are employees of Gao Hua. Beijing Gao Hua Securities Company Limited (“Gao Hua”),
a strategic partner of Goldman Sachs, is a securities company in China licensed by the China Securities Regulatory Commission (“CSRC”) to conduct, amongst others, client asset management
business. Gao Hua Asset Management (“GHAM”) is a department of Beijing Gao Hua Securities Company Limited (“Gao Hua”). Gao Hua Asset Management (“GHAM”) leverages the resources of
Goldman Sachs subject to applicable regulations and Chinese Wall restrictions. The investment team includes portfolio managers and traders for both the collective investment scheme and
separate accounts. According to regulatory requirements, one person cannot be the portfolio manager for both collective investment scheme and separate account simultaneously.
30
Biographies
Professional Background
Jason Granet
Managing Director
Head of International Liquidity
Portfolio Management; Global
Liquidity Management EMEA
Jason is the head of International Liquidity Portfolio Management in London. He is responsible for the
management of international money market and short duration portfolios.
Prior to this, Jason was co-head of the Secured Funding team on the Central Funding desk, beginning
in 2007. In that role, Jason and his team were responsible for all financing transactions and financing
counterparty relationships across the Investment Management Division.
Jason joined GSAM in 2004, where he previously worked in the Fixed Income team’s portfolio and risk
strategy group. Prior to joining GSAM, he was an analyst in fixed income operations at Goldman
Sachs & Co. since 2000. He received a BA in Economics from the University of Michigan in 2000.
Pietro Marini
Executive Director
Global Liquidity Sales
Pietro joined Goldman Sachs in 2010 as Global Liquidity Sales in London. During the years Pietro
covered clients in different regions as Italy, UK, Spain and Switzerland. Prior to join GSAM, he was a
Client Relationship Manager at Barclays Global Investors and JPMorgan.
Pietro holds a Bachelor of Business Administration from the Cattolica University of Milan and an MBA
Degree from the Polytechnic of Milan.
Queenie Siu
Global Liquidity Sales
Queenie joined GSAM in 2010 as Global Liquidity Sales to develop the Liquidity business franchise in
Greater China, based in Hong Kong. Prior joining GSAM, she was the Product Manager in Global
Transaction Services in Citigroup since 2006 Aug.
Queenie holds a Bachelor of Business Administration from the Chinese University of Hong Kong. She
passed all three levels of Chartered Financial Analyst (CFA) program.
Appendix
31
Additional Notes
This material is provided at your request for informational purposes only. It is not an offer or solicitation to buy or sell any securities.
THIS MATERIAL DOES NOT CONSTITUTE AN OFFER OR SOLICITATION IN ANY JURISDICTION WHERE OR TO ANY PERSON TO WHOM IT WOULD BE UNAUTHORISED OR
UNLAWFUL TO DO SO.
Prospective investors should inform themselves as to any applicable legal requirements and taxation and exchange control regulations in the countries of their citizenship, residence or domicile
which might be relevant.
Economic and market forecasts presented herein reflect a series of assumptions and judgments as of the date of this presentation and are subject to change without notice. These forecasts do not
take into account the specific investment objectives, restrictions, tax and financial situation or other needs of any specific client. Actual data will vary and may not be reflected here. These forecasts
are subject to high levels of uncertainty that may affect actual performance. Accordingly, these forecasts should be viewed as merely representative of a broad range of possible outcomes. These
forecasts are estimated, based on assumptions, and are subject to significant revision and may change materially as economic and market conditions change. Goldman Sachs has no obligation to
provide updates or changes to these forecasts. Case studies and examples are for illustrative purposes only.
Although certain information has been obtained from sources believed to be reliable, we do not guarantee its accuracy, completeness or fairness. We have relied upon and assumed without
independent verification, the accuracy and completeness of all information available from public sources.
Past performance does not guarantee future results, which may vary. The value of investments and the income derived from investments will fluctuate and can go down as well as up.
A loss of principal may occur.
Views and opinions expressed are for informational purposes only and do not constitute a recommendation by GSAM to buy, sell, or hold any security. Views and opinions are current as of the date
of this presentation and may be subject to change, they should not be construed as investment advice.
Appendix
32
Additional Notes
This material is provided for educational purposes only and should not be construed as investment advice or an offer or solicitation to buy or sell securities.
This information discusses general market activity, industry or sector trends, or other broad-based economic, market or political conditions and should not be construed as research or investment
advice. This material is not financial research and was not prepared by Goldman Sachs Global Investment Research (GIR). It was not prepared in compliance with applicable provisions of law
designed to promote the independence of financial analysis and is not subject to a prohibition on trading following the distribution of financial research. The views and opinions expressed may differ
from those of GIR or other departments or divisions of Goldman Sachs and its affiliates. Investors are urged to consult with their financial advisors before buying or selling any securities. This
information may not be current and GSAM has no obligation to provide any updates.
The portfolio risk management process includes an effort to monitor and manage risk, but does not imply low risk.
The website links provided are for your convenience only and are not an endorsement or recommendation by GSAM of any of these websites or the products or services offered. GSAM is not
responsible for the accuracy and validity of the content of these websites.
In the United Kingdom, this material is a financial promotion and has been approved by Goldman Sachs Asset Management International, which is authorized and regulated in the United Kingdom
by the Financial Conduct Authority.
Confidentiality
No part of this material may, without GSAM’s prior written consent, be (i) copied, photocopied or duplicated in any form, by any means, or (ii) distributed to any person that is not an employee,
officer, director, or authorised agent of the recipient.
© 2014 Goldman Sachs. All rights reserved. 132013.OTHER.OTU
Appendix