I believe Goldman will be successful with their current strategy of catering towards large corporate financing and derivative products and private banking to large wealth management clients to derive the majority of their revenue for GS Bank USA. As a community bank with a similar but much smaller scale, private bank model operating in Florida, we don't run up against them on the lending side or asset management side much. However, where I do have concerns is on the funding side of the balance sheet. GS Bank has been around for several years and has grown to $116 billion in deposits rather easily with their aggressive rates offered. The more they open up to individual consumers and give them access to their retail banking platform, the more we will have to compete with them for deposits, even here in Florida where they wont have any offices. We already compete with a number of on-line, high-rate deposit gatherers and with Goldman's size it will only make it more difficult. I would think the large retail banks would have more concerns, but it all trickles down to community banks at some point. It will be interesting to watch though, as we will see if a retail consumers shy away or go running towards a Wall St bank offering high rates deposit products. My bet is more consumers are rate shoppers than they lead on and GS Bank USA will continue to grow and expand into retail banking to fund their balance sheet.
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Barry Griffiths
Senior VP & CFO
Seaside National Bank & Trust
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Original Message:
Sent: 03-06-2018 08:57
From: Barb Rehm
Subject: Tuesday Topic: Community Bank of Goldman?
Marcus-Goldman Sachs' consumer-finance unit-was the subject of a sweeping feature in The Wall Street Journal last week. "New initiatives under way include checkout-counter loans for shoppers, wealth management, and household-budgeting tools for the masses as well as insurance, mortgages, and car loans," the newspaper reported. Paying above-market rates, Marcus also managed to add $8 billion in deposits to the $9 billion it bought from GE in 2016.
So today's questions are these: Are you feeling the competitive effects of Marcus in your market? Do you think Goldman Sachs-considered the elite of the elite on Wall Street-can make it on Main Street?
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Barb Rehm
Promontory Interfinancial Network
Arlington VA
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