U.S. investment bank Goldman Sachs (GS) plans to double its lending to ultra-wealthy private bank clients with account sizes of more than $10 million U.S.
The Reuters news agency is reporting that Goldman Sachs aims to double its lending to the super rich over the next five years.
In an interview with Reuters, Nishi Somaiya, Goldman Sachs’ head of private banking, said the loans will likely be used to help high net worth clients purchase everything from luxury homes to professional sports teams.
Goldman Sachs’ wealthy clients typically have a net worth of at least $30 million U.S. The private bank unit's outstanding loans stood at $33 billion U.S. as of March 31 this year.
The push into private banking comes after Goldman’s expansion into retail banking failed and is now being shutdown.
Currently, Goldman Sachs' lending in wealth management as a percentage of its wealth client assets stands at about 3%, well below an average of 9% among other Wall Street lenders.
Bank of America's (BAC) outstanding loans to wealth management clients stood at $220 billion U.S. at the end of its last financial year, similar to JPMorgan Chase's (JPM) loans to rich clients.
The stock of Goldman Sachs has risen 31% over the past 12 months and currently trades at $448.70 U.S. per share.
