The Federal Reserve Board has voted to allow Goldman Sachs Group Inc. to retain an 9.8% stake in a small Tennessee banking company. Goldman Sachs Investment Partners Master Fund LP made the investment in the $589 million-asset Avenue Financial Holdings Inc. in Nashville in 2007.
The Fed's approval, released Friday, was prompted by Goldman's 2008 conversion to a bank holding company at the height of the financial crisis. The Fed said approval was based on Goldman's commitment to maintaining a passive role in Avenue.
"Goldman has committed not to exercise or attempt to exercise a controlling influence over the management or policies of Avenue or any of its subsidiaries," the Fed said. A Goldman spokeswoman declined to comment. Avenue did not return calls for comment.