From Business Week “Wachovia officials say the bank has hired Wall Street investment firm Goldman Sachs Group for advice on the bank’s loan portfolio.

Wachovia Corp. spokeswoman Christy Phillips-Brown said Tuesday the firm was hired to analyze the Charlotte-based bank’s loan portfolio and evaluate various alternatives. Phillips-Brown declined to comment further.

Wachovia is in the midst of looking for a new chief executive after it ousted Ken Thompson earlier this month amid rising loan losses and a series of miscues.

Chairman and interim CEO Lanty Smith is leading a search for a permanent replacement.”

If Wachovia wants Goldman Sachs to “evaluate various alternatives” it’s a fairly safe guess that there’s problems in the portfolio. One solution lenders have used in the past is to “fire sale” the non-performing loans for somewhere around 60 cents for every dollar loaned to companies that will either make the loans performing or foreclose on the property. If Wachovia is looking to unload second loans on underwater properties, of course those loans won’t really have any value at all. It’ll be interesting to see what comes from the Goldman Sachs analysis.