Investors accuse Goldman of blocking financial reform

(AP) JERSEY CITY, New Jersey - For once, the spotlight wasn't on Goldman Sachs (GS).

The bank that Wall Street critics love to hate enjoyed a relatively calm shareholder meeting Thursday while two of its peers, Morgan Stanley (MS) and JPMorgan Chase (JPM), grappled with public-relations nightmares.

Goldman CEO Lloyd Blankfein was peppered with questions about the bank's political lobbying, but the vitriol and the shouting protesters that have haunted other banks' meetings this spring were absent.

The tranquility was partly a product of timing. Earlier this month, JPMorgan announced a surprise $2 billion trading loss, which has bolstered the banking industry's critics but also taken pressure off Goldman.

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Last week, police with guns stood guard outside JPMorgan's annual meeting in Florida while shareholders inside hounded Jamie Dimon, the usually unflappable CEO.

That same day, protesters at Morgan Stanley's meeting shouted down CEO James Gorman. And this week, Morgan has fielded questions about how it handled analyst reports ahead of the initial public offering of Facebook stock.

Protestors have also swarmed this spring outside the meetings of Bank of America (BAC) and Wells Fargo (WFC), and Citigroup (C) shareholders registered their discontent with CEO Vikram Pandit by voting against his $15 million pay package.

At the Goldman meeting, several shareholders said the bank should disclose more about what it is spending to lobby politicians and regulators crafting strict new banking laws. They accused Goldman of trying to water down the legislation.

Blankfein made no apologies for approaching lawmakers and regulators.

"There's requests for comments. We provided our comments," Blankfein said. "The world would see that as lobbying, but we were really once again fulfilling our duty to provide information on areas where we have expertise."

Blankfein did say that he was in favor of the so-called Volcker rule, which might have prevented the type of trading that led to JPMorgan's loss, but he also said that many parts of it were unclear.

One shareholder told Blankfein that Goldman's reputation "is in tatters," alluding to the subprime mortgages it packaged into securities before the financial crisis.

Another asked whether Goldman would renegotiate loans to the city of Oakland, Calif. Blankfein said the bank couldn't just lower interest rates for anyone unhappy with their terms:

"That's not how the financial system works," he said.

"It is an issue of morality," the shareholder said.

"No, I think it's an issue of shareholder assets," Blankfein replied.

For the most part, though, the meeting was placid. Blankfein stood behind a glass podium in an undecorated sixth-floor conference room at Goldman's Jersey City offices and appeared to grow more comfortable as the meeting wore on, occasionally smiling and gesturing.

When Sister Barbara Aires, of the Catholic organization Sisters of Charity of St. Elizabeth, asked for more information about Goldman's new business standards, Blankfein told her she sounded a lot like a Goldman Sachs executive.

"Maybe you can hire me," Aires replied.

"I don't think we can outbid your current boss," Blankfein quipped.

Blankfein, 57, the CEO for six years, isn't known for his charisma. But in recent months, Goldman has suffered regulatory fines and the resignation of an employee who publicly accused the bank of ripping off its clients.

The bank, in an attempt to burnish its public image, has sent Blankfein out for TV interviews and as a spokesman for gay rights.

Shareholders approved all the board members, including Michele Burns, who some had questioned because she was on the Walmart (WMT) board when the company was reportedly bribing Mexican officials.

Shareholders also approved Blankfein's pay package from last year, which could eventually be worth about $16 million and included more than $51,000 for a car and driver and nearly $259,000 for security services.