UPDATE 2-Goldman Sachs CFO seeks to repay TARP funds

* Looks to repay $10 billion in TARP funds this year

* Expects Goldman to remain a wholesale banking company

* Says Goldman looking at ways to increase deposits

* Goldman shares rise 7.4 pct
(Adds detail on TARP funds, share price)

By Elinor Comlay

NEW YORK, Feb 4 (Reuters) - Goldman Sachs Group Inc (GS.N)
Chief Financial Officer David Viniar said the bank is keen to
avoid restrictions it agreed to after receiving funds from the
U.S. government late last year and it is looking to pay the
money back as soon as possible.

The investment bank, which received a $10 billion capital
injection from the U.S. Treasury's Troubled Asset Relief Program
in October, is not happy with the strings that came attached to
the money.

Compensation restrictions and certain capital requirements
were part of the original injection, and extra limitations may
be in store after U.S. President Barack Obama imposed tough new
rules limiting pay for companies receiving government aid.

"We would like to get out from under that," Viniar said,
adding that the bank aims to pay back the $10 billion this
year.

Viniar said Goldman Sachs is also cautious about buying a
bank, a move many have urged upon the investment bank to ensure
its access to stable deposit funding.

Banks have come under heavy fire for paying executives too
much after receiving more than $300 billion of capital from the
government and trillions of dollars of additional U.S. support.
A report last week said that banks paid out $18.4 billion of
bonuses, a fact that Obama called "shameful."

But Goldman can potentially pay back its $10 billion, and
avoid salary caps, by issuing preferred stock rather than common
stock, Viniar said.

Shares of Goldman Sachs were up $6.13 or 7.4 percent at
$88.94 on the New York Stock Exchange on Wednesday afternoon,
amid a broader rally in shares of financial companies.

Obama said on Wednesday that compensation at TARP recipients
would be limited to $500,000 a year, adding that lower
compensation is a crucial element of restoring taxpayer trust.

NO BANK ACQUISITIONS

Investors have pressed Goldman to buy a bank to boost its
deposit funding, which is seen as a more reliable way for the
investment bank to finance itself amid the credit crunch.

But Viniar, speaking at a Credit Suisse Financial Services
conference on Wednesday, said Goldman is in no rush to acquire
another institution, and will look for other ways to boost its
deposits.

"Don't pick up The Wall Street Journal looking for a Goldman
Sachs acquisition because I think you will be largely
disappointed," he said.

There is a long history of financial services acquisitions
that have failed due to the difficulty of integrating different
companies' cultures, he said, and this makes Goldman wary of
such an acquisition.

"I don't expect our form to change," he said, adding, "I
expect us to be largely a wholesale company." Wholesale finance
companies fund themselves in bond markets.
(Reporting by Elinor Comlay; editing by John Wallace and
Matthew Lewis)