From CNBC: 2024-09-09 18:09:02

Goldman Sachs CEO David Solomon announced that the bank will take a $400 million hit to third-quarter results due to unwinding its consumer business, including the GM Card and loan portfolio sales. This move follows previous writedowns related to consumer operations in late 2022, signaling a shift towards asset and wealth management for growth.

The bank’s credit card business, especially the Apple Card, allowed rapid retail lending growth but also resulted in losses and regulatory challenges. CEO Solomon emphasized a focus on asset and wealth management to drive growth, highlighting a 10% decline in trading revenue due to tough year-over-year comparisons and challenging fixed-income markets in August.

Goldman Sachs aims to pivot away from consumer retail and towards asset and wealth management, selling the GM Card platform to Barclays to facilitate this change. The decision to unwind parts of the consumer business reflects a strategic redirection following previous writedowns and challenges related to consumer operations, allowing the bank to pursue more stable and lucrative avenues for growth.



Read more at CNBC: Goldman Sachs to post $400 million hit in third quarter over consumer business