STRATS(SM) Trust for Goldman Sachs Group Securities, Series 2006-2 Annual Report

I’m here to help you break down the latest annual report for this investment. Think of this as a plain-English guide to understanding your investment without the complicated financial jargon.

1. What does this trust do?

This is a "Structured Trust Asset Repackaged Securities" (STRATS) vehicle created in 2006. It acts as a simple pass-through. The trust holds $100 million in 5.70% Senior Notes from The Goldman Sachs Group, Inc., due November 15, 2036. Its only job is to collect interest from these notes and pay it to you, after taking out small administrative fees.

2. Financial performance

For the year ending December 31, 2025, the trust collected and paid out the scheduled interest. It generated enough cash to cover the Trustee’s annual fee, which is capped at roughly $15,000 to $20,000. This ensured your payments remained consistent with the yield of the Goldman Sachs debt. The trust is fully compliant with its original agreement.

3. Operational reliability

The Bank of New York Mellon, the Trustee, processed all interest payments on time and without error. There were no defaults or credit issues with Goldman Sachs. Because the trust is static and requires no active management, the process remains straightforward and predictable.

4. Financial health

The trust maintains a clean balance sheet with no debt other than the certificates you hold. An independent audit confirmed that the Trustee maintained effective internal controls throughout 2025. 100% of the interest income from Goldman Sachs was correctly passed on to investors.

5. Key risks

Your investment faces two main risks:

• Credit Risk: You rely on the financial health of The Goldman Sachs Group. If their credit rating drops or they face a cash crisis, the value of your certificates will likely fall.
• Interest Rate Risk: These notes pay a fixed 5.70%. If market interest rates rise significantly above that, the resale value of your certificates will likely drop.

6. Strategy and outlook

This is a "buy-and-hold" vehicle designed for predictable income rather than capital growth. The trust will continue its current path until the notes mature in 2036. You can expect steady, semi-annual interest payments as long as Goldman Sachs remains solvent. No structural changes are planned, and the fee schedule remains unchanged since 2006.

7. Regulatory context

The trust follows standard SEC reporting rules. Because the trust is a pass-through entity, it is sensitive to broader banking regulations that affect Goldman Sachs. Any regulation that impacts Goldman Sachs’ ability to meet its debt obligations would directly affect your distributions.

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Investor Tip: Since this trust is a passive vehicle, it does not monitor the financial health of Goldman Sachs for you. To stay informed, you should periodically review the latest financial filings for The Goldman Sachs Group, as their creditworthiness is the primary driver of your investment's value.