Goldman Sachs wants to exit Apple’s cards business, report claims

Goldman Sachs’ third-quarter earnings may have been the straw that broke the camel’s back Apple card The Wall Street giant faces internal pressure to exit the consumer lending business. The Apple partnership has long been seen as a distraction from Goldman’s core business, the Wall Street Journal mentioned Monday. Regarding what was recently launched Apple savings accounts“We should never have done this damned thing,” one Goldman partner told colleagues. (Censorship of the magazine)

Goldman is under intense pressure to reduce losses, as analysts expect the bank’s profits to decline significantly during this quarter. Apple Products could be with the bank on the chopping block if earnings are as bad as expected. Sources told the Wall Street Journal that senior executives want to get out of the consumer lending business, and Apple’s financial products may want to. It was discharged To another bank – perhaps American Express.

Goldman stock was down 11% in 2023, but so was the entire banking industry In dumps this year. An index of the largest US banks fell by 24% in 2023 due to the collapse of regional banks, higher interest rates and increased regulation, while the S&P 500 rose by 14%.

In October 2019, Goldman Sachs CEO David Solomon Named the Offer Apple Card “The most successful credit card launch ever.” Apple Tim Cook He said Around the same time the card would be “the most significant change to the credit card experience in 50 years.”

The tone has certainly changed, and many Goldman executives are questioning whether the foray into consumer banking should happen at all. The partnership between the two powerhouses of Silicon Valley and Wall Street, once lauded as innovative, is now one of the most scrutinized decisions of Solomon’s career.

The only thing keeping Apple in the notorious Wall Street establishment is… Apple high-yield savings accounts Launched a few months ago. These accounts were, and still are, hugely popular, attracting billions in deposits that Goldman cannot afford to part with. If Goldman backs out of the Apple deal, the bank may have to raise expensive capital in a short period of time.

Solomon’s partnership with Apple follows the same approach for the rest of his term. Face the flashy CEO Extreme scrutiny Goldman is among partners for its focus on consumer lending and not focusing on the traditional core elements of banking. The partners secretly called for the complete overthrow of Suleiman. Goldman Sachs recently sold Green Sky, another consumer lending platform promoted by Solomon, for a price Steep discount What the fintech company bought last year.