Goldman Sachs Expects Marcus to Get ‘Very Big, Very Profitable’By
Solomon says it could expand into mortgages, cards, auto loans
Goldman president sees build-up ‘over the next 50 years’
Goldman Sachs Group Inc.’s push into consumer finance has even bigger aims than investors might imagine.
Personal loans are just the start, with possible expansion opportunities for its Marcus brand in mortgages, credit cards, auto loans and insurance, Goldman Sachs President David Solomon said in a presentation Thursday.
“We don’t have to be one of the big leading consumer banks -- we can have a narrow slice of share and have a very big, very profitable, very differentiated business over a period of time,” Solomon said. “We’re building it as a platform for Goldman Sachs over the next 50 years.”
Since the consumer bank started in 2016, it’s attracted 1.5 million customers, made over $3 billion of loans and gathered $22 billion of digital deposits, Solomon said. Goldman Sachs is planning to expand Marcus into Europe with operations in Germany and the U.K. It also acquired personal-finance app Clarity Money to increase the customer base.
Solomon likened the consumer bank to the start of Goldman Sachs’s investment-management business 30 years ago. As onlookers focus on the firm’s installment lending, Solomon pointed instead to the “broad vision to build this platform” and its ability to link the bank’s other services like wealth management.
He said the bank could be expanding consumer loans faster, but it’s being “cautious” because of concern that the credit cycle may turn.