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Goldman Sachs’ Is Reinventing Itself: A Bank For Everyone

Goldman Sachs
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Goldman Sachs is no longer the vampire squid of years past.  Today, for the first time in history, the lauded investment bank will be hosting an investor day.  In-person attendance is by invitation only, but anyone with an internet connection can live-stream the investor day here beginning at 8:00 am eastern.  Chairman and CEO, DJ D-Sol, is expected to address the firm’s key strategic priorities and outlook for the industry.

The investor day is meaningful because it underscores Goldmans’ marked transition from an elite and secretive investment bank to an open and increasingly retail-focused operation with a proclivity for marketing campaigns that reach GEICO-level absurdity.

The Background

Goldman has struggled to keep pace with many of its peers.  Over the last five years, Goldmans’ share price has appreciated just 28%, while competitors J.P Morgan and Bank of America have soared 120% and 105%, respectively.

Recently, Goldman has invested heavily in building out its consumer banking operation, Marcus, which offers high-interest rate savings accounts as well as personal loans.  It’s a big change for the bank which used to pride itself on serving only large institutional and ultra-high net worth clients.  Goldman has also explored offering wealth management services for the “mass affluent,” with liquid assets between $100,000 and $1 million.

Many analysts on Wall Street have applauded the move, as business lines such as wealth management tend to provide more stable, recurring revenue than sales and trading and M&A advisory (which Goldman has focused on in the past). 

The Takeaway

Certainly, Goldman remains a force in the world of high finance.  The company’s mergers and acquisitions advisory business led the league tables in 2019, bringing in over $2.5 billion in fees.  But our bet is the investor day will focus more on all the big plans Goldman has for every-day Americans.

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