Goldman Sachs weighs selling part of wealth business in broad strategy revamp

Goldman Sachs (GS.N) 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 shift in strategy comes after CEO David Solomon reorganized the firm into three units last year and scaled back ambitions for its consumer business, which lost $3 billion in the last three years.

Goldman is also pushing ahead with a sale of its fintech business, GreenSky and has also offloaded the bulk of its unsecured consumer loans after it halted this kind of lending last year.

“This is part of the overall restructuring of the firm, back toward its roots,” said Stephen Biggar, an analyst at Argus Research.

“They’ve been unable to carve a path of profitability and scale” for the RIA, which catered to high-net-worth individuals in mass markets outside of Goldman’s core, ultra-wealthy clientele, Biggar said.

Goldman declined to comment on PFM’s earnings.

The company’s shares were down 1.4% in afternoon trading, compared with the S&P index of bank stocks (.SPXBK), which was down 0.6%.

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

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