September 20, 2013 / 3:39 AM / 5 years ago

Goldman hit by debt auction error at New York Fed: FT

The Goldman Sachs logo is displayed on a post above the floor of the New York Stock Exchange, September 11, 2013. REUTERS/Lucas Jackson

(Reuters) - Goldman Sachs (GS.N) was hit by a clerical error at the New York Federal Reserve that left the bank without any of the three-month Treasury bills it ordered at a debt auction, the Financial Times reported, citing people familiar with the matter.

The newspaper said Goldman had suffered a loss due to the mix-up but did not specify the amount of the loss. Goldman declined to comment to the newspaper.

An official at the New York Fed, which conducts auctions for the Treasury, had to record orders manually following a computer malfunction on September 9. In addition to receiving none of the three-month bills it wanted, Goldman also got more six-month Treasury bills than it had ordered, the FT said.

As a result of the error, Goldman went over the 35 per cent Treasury limit that a bidder can acquire in an auction due to over allotment of the six month bills, the paper said.

The Treasury waived that rule while letting the results of the auction stand, and there will likely be no additional remedies for the bank, a person told the paper.

The Treasury’s Public Debt bureau acknowledged in a statement to the Financial Times that there was a technical issue, but did not specify which bidder was affected.

Goldman and Treasury’s Public Debt bureau could not immediately be reached for comment by Reuters outside of regular U.S. business hours.

Reporting by Sakthi Prasad in Bangalore; Editing by Edwina Gibbs

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