Goldman Sachs is reportedly making plans to lay off hundreds of employees from its retail banking division as it restructures its consumer banking business.
The firm is bracing for economic uncertainty caused by inflation and rising interest rates, Bloomberg reported Monday, citing individuals familiar with the matter. Wall Street’s dealmaking boom has come to an end, causing rival banks such as Morgan Stanley and Citigroup Inc. to cut jobs, according to Reuters.
NEW: Goldman Sachs aims to cut at least a few hundred more jobs as it restructures its struggling consumer business and braces for an uncertain economy next year https://t.co/CWMmAuNojo
— Bloomberg (@business) December 12, 2022
Goldman Sachs is reinstating an annual policy to fire between 1% to 5% of its lowest-performing staffers after pausing the policy during the pandemic, The New York Times reported. The potential retail banking job cuts, which could affect at least 400 positions, would be in addition to layoffs for underperforming employees, according to the Financial Times.
Goldman plans to stop offering personal loans from its retail banking platform, Marcus, launched in 2016 as one of the bank’s first consumer products, the Financial Times reported. (RELATED: Household Wealth Drops For Third Straight Quarter)
The bank has struggled to build a competitive consumer banking business, and the firm announced in October it was moving away from its plan to create a full-scale retail bank, CNBC reported.
In its October overhaul, Goldman merged the consumer banking division with its wealth management division and its recently created platform solutions unit, according to Reuters.
The banking giant reportedly saw a 44% profit slump in the third quarter of earnings, less than expected by investment analysts. Goldman’s $8.25 profit per share beat estimates of $7.69 per share, as revenue fell by 12% to a total of $11.98 billion, according to the bank’s earnings release.
Goldman Sachs declined to comment on the Daily Caller’s questions regarding potential layoffs, and instead referred the Caller to a recent Bloomberg interview with Goldman CEO David Solomon.