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Goldman Sachs (GS) Expands Consumer Banking Business
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The Goldman Sachs Group, Inc. (GS - Free Report) , widely focused on large companies and wealthy clients, is expanding its offerings to general consumers through its new retail banking service.
In April, complementing its funding capabilities, Goldman’s subsidiary – Goldman Sachs Bank USA (GS Bank) – completed the acquisition of the online deposit platform of GE Capital Bank. According to a recent report by the Associated Press, GS Bank has added $1 billion in new deposits. Also, the Wall Street giant’s unit intends to expand its offerings with personal loans shortly.
Currently, GS bank’s online deposit platform allows customers to open savings accounts and invest in certificates of deposits. Notably, the company is offering competitive rates for online savings accounts which stand above 1% where as several others pay less.
The report quoted Stephen Scherr, CEO of GS Bank, saying, “We see an opportunity to serve a different customer set than we typically have served,” adding, “And we do it at a time when there is a lot of change in how banking is done with and for consumers.”
Scherr also stated that the company sees itself as a competitor to traditional consumer banks as well as online startups. The unit enjoys competitive advantage due to the name recognition and business expertise of an established financial brand, unlike other startups.
Following the 2008 financial crisis, investment banks like Goldman are pushed to operate more like universal banks. Notably, Goldman has been undertaking efforts to boost the business of GS Bank as stringent regulations, higher capital requirements and volatile markets have posed revenue challenges.
The online lending business that is posing a threat to the traditional banking business is rapidly growing with a number of online lenders. Though by joining the online lending bandwagon Goldman faces risks including stiff competition, we believe the financial bigwig will certainly come up with a strategy to gain a strong foothold in its new venture.
Currently, Goldman carries a Zack Rank #3 (Hold). Some better-ranked stocks in the finance space include LPL Financial Holdings Inc. (LPLA - Free Report) , Cathay General Bancorp (CATY - Free Report) and First Bancorp (FBP - Free Report) , each sporting a Zacks Rank #1 (Strong Buy).
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Goldman Sachs (GS) Expands Consumer Banking Business
The Goldman Sachs Group, Inc. (GS - Free Report) , widely focused on large companies and wealthy clients, is expanding its offerings to general consumers through its new retail banking service.
In April, complementing its funding capabilities, Goldman’s subsidiary – Goldman Sachs Bank USA (GS Bank) – completed the acquisition of the online deposit platform of GE Capital Bank. According to a recent report by the Associated Press, GS Bank has added $1 billion in new deposits. Also, the Wall Street giant’s unit intends to expand its offerings with personal loans shortly.
Currently, GS bank’s online deposit platform allows customers to open savings accounts and invest in certificates of deposits. Notably, the company is offering competitive rates for online savings accounts which stand above 1% where as several others pay less.
The report quoted Stephen Scherr, CEO of GS Bank, saying, “We see an opportunity to serve a different customer set than we typically have served,” adding, “And we do it at a time when there is a lot of change in how banking is done with and for consumers.”
Scherr also stated that the company sees itself as a competitor to traditional consumer banks as well as online startups. The unit enjoys competitive advantage due to the name recognition and business expertise of an established financial brand, unlike other startups.
Following the 2008 financial crisis, investment banks like Goldman are pushed to operate more like universal banks. Notably, Goldman has been undertaking efforts to boost the business of GS Bank as stringent regulations, higher capital requirements and volatile markets have posed revenue challenges.
The online lending business that is posing a threat to the traditional banking business is rapidly growing with a number of online lenders. Though by joining the online lending bandwagon Goldman faces risks including stiff competition, we believe the financial bigwig will certainly come up with a strategy to gain a strong foothold in its new venture.
Currently, Goldman carries a Zack Rank #3 (Hold). Some better-ranked stocks in the finance space include LPL Financial Holdings Inc. (LPLA - Free Report) , Cathay General Bancorp (CATY - Free Report) and First Bancorp (FBP - Free Report) , each sporting a Zacks Rank #1 (Strong Buy).
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>