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The
Wall Street bank is evaluating alternatives for its registered
investment adviser unit, called Personal Financial Management (PFM),
which manages about $29 billion, it said in a statement.
Goldman bought the registered investment adviser, 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 unit oversees $1 trillion in assets for
ultra-high net worth clients.
The potential divestment comes after CEO David Solomon
reorganized the firm into three units last year and scaled back
ambitions for its loss-making consumer business.
Its fintech business, GreenSky, is also for sale.
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.
The bank plans to grow its core wealth business serving
ultra-high net worth clients, reiterating aspirations from its
investor day in late February. Other core wealth businesses
include workplace financial planning through Ayco, and Marcus
savings, Goldman said.
U.S. banks compete to serve ultra-wealthy clients by providing
brokerage, mortgage and other services, as well as estate and
tax planning. Those activities tend to generate more stable
revenues than volatile Wall Street operations, such as
investment banking and trading, which are strongly linked to
economic activity.
(Reporting by Saeed Azhar; Editing by Lananh Nguyen and Tom
Hogue)
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