Goldman Sachs explores investment adviser sale in retreat from mass market

Obtain free Goldman Sachs Group updates

We’ll ship you a myFT Day by day Digest e mail rounding up the most recent Goldman Sachs Group information each morning.

Goldman Sachs is exploring a sale of the funding advisory enterprise it acquired 4 years in the past, marking an extra retreat from efforts to be a serious financial institution to mass-market clients.

The Wall Road agency stated on Monday it was “presently evaluating alternate options” for its private monetary administration enterprise, which encompasses Goldman’s registered funding adviser operations and supervises about $29bn in belongings.

The enterprise grew out of United Capital, a California-based funding adviser that Goldman acquired for $750mn in 2019. The deal got here as Goldman was pushing to serve a broader array of consumers.

It’s now the second deal executed underneath chief govt David Solomon that Goldman is seeking to undo. The financial institution this yr put up on the market the web lending enterprise GreenSky, acquired in 2021.

“We anticipate finding an final result that advantages each our purchasers and our advisers,” the financial institution stated of the non-public monetary administration enterprise.

Goldman’s wealth administration operation has traditionally been weighted extra to the super-rich — so-called ultra-high internet value purchasers — whose wealth is a minimum of within the tens of thousands and thousands of {dollars}.

United Capital’s clients sometimes had extra modest fortunes. The deal 4 years in the past was an indication of Goldman’s efforts to serve a broader array of consumers.

Losses from the push into mass-market banking have contributed to pressures on Solomon, who’s contending with essentially the most difficult interval of his almost five-year tenure as chief. Apart from plans to promote GreenSky, Goldman final yr determined to pare again its Marcus on-line retail banking enterprise.

Goldman remains to be prioritising development in asset and wealth administration, companies which can be extra predictable and secure than its core funding banking and buying and selling actions.

In wealth administration, Goldman has greater than $1tn in belongings underneath supervision together with from its non-public wealth enterprise and its Ayco office cash administration platform. United Capital had about $25bn in belongings underneath administration when Goldman purchased it.

Registered funding advisers are licensed to supply recommendation and typically immediately handle cash. The financial institution stated it might proceed to put money into its companies to cowl advisers as clients.

Goldman is exploring a sale at a time of heightened job-hopping by registered funding advisers this yr in response to mergers and turmoil within the banking sector. Many are leaving advisory teams owned by banks for boutique operations or beginning their very own companies, and taking their books of purchasers with them.

Goldman final yr merged its wealth administration and asset administration companies, with the mixed unit now run by Marc Nachmann, a detailed confidant of Solomon.