Goldman Sachs Weighs Sale of Part of Its Wealth Business

Goldman Sachs is weighing the sale of a part of its wealth business, it said on Monday, as it shifts its focus back to serving the ultra-rich and away from high-net-worth clients in mass markets.

The Wall Street bank is evaluating alternatives for its registered investment adviser (RIA) unit, called Personal Financial Management (PFM), which manages about $29 billion, it said in a statement.

The move comes as Goldman retreats from its consumer operations, which lost $3 billion in the last three years, and pushes ahead with a sale of its fintech business, GreenSky.

Goldman bought the RIA, formerly known as United Capital Financial Partners, for $750 million in 2019 when it managed about $25 billion in funds. The purchase aimed to broaden Goldman's client list beyond the ultra-rich, but the unit has remained a small part of the bank's wealth business.

Goldman's private wealth arm oversees $1 trillion in assets for ultra-high net worth clients.

The potential divestments come after CEO David Solomon reorganized the firm into three units last year and scaled back ambitions for its loss-making consumer business.

The company's shares slipped 0.9% in early trading, compared with the S&P index of bank stocks .SPXBK, which was broadly stable.

Goldman's wealth business has lagged rivals, including Morgan Stanley, where CEO James Gorman built the wealth management arm through a series of acquisitions that generate steady income from fees.

Solomon has been under pressure to turn around Goldman's fortunes after its profit sank 60% in the second quarter as writedowns on its consumer businesses and real estate investments weighed on earnings.

(Source: Reuters)