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Treasury Secretary Timothy Geithner's mantra to create a "more boring" financial system may not hamper Wall Street's risk-taking culture.

Goldman Sachs Group Inc. (GS) and Morgan Stanley (MS), the two biggest independent U.S. securities firms, already have scaled back risk as the government stepped in. It isn't expected that regulators will become even more heavy handed, people inside the two banks said.

The government's new regulatory regime is expected to guard against the kind of systemic risk that triggered the worst financial crisis since the 1930s. But analysts don't believe the new oversight plan will be that much of a drag on their current business mix.

"I think the framework that evolved in the broker-dealer community will remain intact," said Roger Freeman, an analyst at Barclays Capital. "Nothing is going to change. But I think the government will still have plenty of avenues to influence them going forward."

The transformation into bank holding companies ushered in tougher supervision for previously lightly regulated investment banks. It was designed to keep Goldman and Morgan Stanley afloat as the financial crisis forced Lehman Brothers into bankruptcy, and nearly collapsed Bear Stearns and Merrill Lynch.

Goldman and Morgan Stanley submitted themselves to stringent capital requirements, limits about the amount of debt they can take on, and greater scrutiny on executive pay. The steps helped calm nervous investors about the investment banks' survival, but also clipped the companies' ability to turn huge profits by limiting the risks they could take.

The investment banks still have to make some changes to conform to the new regulatory environment. As bank holding companies, they aren't currently allowed to be in businesses such as transportation, commodities and real estate.

For instance, Goldman Sachs owns commodity trader J. Aron & Co. and is the largest shareholder of oil refiner CVR Energy Inc. (CVI). Morgan Stanley owns fuels distributor TransMontaigne Partners and oil tanker company Heidmar Group.

However, they have five years to change their business models -- or, possibly, have those businesses grandfathered in. Analysts believe keeping essentially their current mix of businesses won't be hard to do.

One potential solution to their problems is the Gramm-Leach-Bliley Act, a 1999 amendment to the bank holding act that allows banks to convert to financial holding companies. This new status would allow Goldman and Morgan Stanley to engage in a larger swath of businesses, such as merchant banking, commodities, and real estate.

"They might convert to a financial holding company, which allows them to operate in the banking sector but also in the industrial sector," said Richard X. Bove, an analyst with Rochdale Securities. "And, we're now starting to see the basic businesses with Goldman and Morgan Stanley come alive again."

-By Joe Bel Bruno, Dow Jones Newswires; 201-938-4047; joe.belbruno@dowjones.com