Goldman Accepted 15,000 Bottles Of Fine Wine As Loan Collateral

Some say 15,000 bottles of fine wine from the Burgundy and Bordeaux regions of France ain’t what it used to be.


For ex-Goldman Sachs trader Andrew Cader, it meant a loan from his former employer, reports BusinessWeek’s Miles Weiss.

Goldman Sachs’s move stands out because private banks that lend money to wealthy clients against assets such as artwork and real estate have been less willing to extend loans backed by fine wines, said four specialty lenders and attorneys. 

As the U.S. puts pressure on proprietary trading, firms are looking more toward private banking. Loaning against appreciating high-class assets, such as wine, may be be tempting for investment banks struggling to find new revenue.

The Liv-ex 100 Fine Wine Index, an industry benchmark that reflects the price movement on 100 of the most sought-after wines that have an established secondary market, has increased at an average annual rate of 11 per cent during the past decade through April, outpacing the 7.9 per cent total return for the Standard & Poor’s 500 Index.

Wines may have outperformed the stock market, but counterfeit wine pours throughout the vintage market. Billionaire magnate William Koch recently filed a series of lawsuits, winning one over 24 bottles of phony Bordeaux.

For more on wine collateral head to BusinessWeek>

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