FORTUNE — How risky is Goldman Sachs? Don’t ask. Executives won’t tell you.
On a conference call with analysts on Tuesday to announce first-quarter earnings, which beat expectations but still somehow disappointed, Goldman’s CFO Harvey Schwartz was asked about a key measure that tracks how many potential risky securities or loans the bank has. Had it risen or dropped? Schwartz’s response: We aren’t saying.
Goldman (GS) doesn’t have to. Dodd-Frank, the banking reform law passed in the wake of the financial crisis, doesn’t require Goldman and other big banks to begin using the measure Schwartz was asked about for another few years. Nonetheless, nearly all the big banks began regularly disclosing the new figure of so-called risk-weighted assets, known as Basel 3, last year. Goldman is the only holdout.
The question of how much risky trading Goldman still does has been an issue in the wake of the Federal Reserve’s recent stress tests. While Goldman passed the stress test, it was one of two banks, the other was JPMorgan Chase, that was asked to resubmit its capital plan despite otherwise getting a thumbs up from regulators. The Fed said it had some issues with Goldman but didn’t say what.
CEO Lloyd Blankfein has repeatedly said the firm has closed its proprietary trading unit. And the firm’s own numbers suggest it has cut back risk.
Still, the Fed’s stress test estimated that Goldman could lose $25 billion from bad trades if we were to enter another financial crisis, more than any other bank the Fed tested. The fact that Goldman remains the only bank that’s not reporting the new measure adds to the mystery and skepticism of the firm’s claims that it has been cutting its risk levels.
Goldman does disclose an earlier figure that Dodd-Frank is phasing out. That measure of risky assets, known as Basel 1, appears to have risen pretty dramatically, up 20% or $80 billion, in the the first three months of the year to $480 billion, after dropping for much of 2012. But a source at Goldman says much of the jump has to do with a switch in the way the figure was calculated this year, not a reflection that Goldman is loading up on risky assets. Regulators required Goldman and others to make the change — an interim step toward implementing the full Dodd-Frank measure in the next year or so.
Other banks also showed a jump in risky assets as a result of the change in the calculation. But not as much as at Goldman. At JPMorgan (JPM), the measure rose by 10%. At Citigroup (C), the figure jumped by 14%.
What’s more, those other banks have been much more transparent about how much risky assets they have under the new Basel 3 rules. At JPMorgan, that measure of risky assets rose slightly in the first quarter. At Citi, the figure dropped.
Goldman did disclose that it had $728 billion in risk-weighted assets based on the way Dodd-Frank measures it at the end of the third quarter. That’s the only time the firm has disclosed that number. At that time, its ratio of capital to those risky assets was 8.5%. Goldman now says that capital ratio has risen to 9%. But in the past six months, Goldman has earned about $5 billion. Add that to its capital, and it appears that Goldman’s risky assets have grown as well, and now stand at about $740 billion.
All this might explain why Goldman’s stock fell $2.36, or just over 1.6%, to $144 Tuesday even after the company reported strong earnings. Left in the dark, how can Goldman’s investors know whether it’s safe to stay?