- Goldman Sachs said Wednesday that it has agreed to sell its fintech lending platform GreenSky to a group of investors led by private equity firm Sixth Street.
- The deal, which also includes a loan book created by Goldman, will result in a 19 cent per share reduction in third-quarter profit, Goldman said in the statement.
- The New York-based bank is expected to report results on Tuesday.
David Solomon, CEO of Goldman Sachs Group Inc., during a Bloomberg Television at the Goldman Sachs Financial Services Conference in New York, U.S., on Tuesday, December 6, 2022.
Michael Nagle | Bloomberg | Getty Images
Goldman Sachs said Wednesday that it has agreed to sell its fintech lending platform GreenSky to a group of investors led by private equity firm Sixth Street.
The deal, which also includes a loan book created by Goldman, will result in a 19 cent per share reduction in third-quarter earnings, Goldman said in the statement. The New York-based bank is expected to report results on Tuesday.
The move is the latest step taken by CEO David Solomon to back away from his ill-fated foray into retail banking. Under Solomon’s leadership, Goldman acquired GreenSky for $1.7 billion last year, defying lawmakers who felt the home improvement lender wasn’t a good fit. Months later, Solomon decided to seek offers for the company as he moved away from consumer finance in general. Goldman also sold a wealth management business and was reportedly in talks to relocate its Apple Card business.
“This transaction demonstrates our continued progress in focusing our consumer business,” Solomon said in the release.
The bank is now focusing on its core competencies in investment banking and trading, as well as its efforts to increase wealth and wealth management fees, he added.
Goldman will continue to operate GreenSky until the sale is completed in the first quarter of 2024, the bank said.
The expected impact on third-quarter earnings includes expenses related to a write-down of GreenSky’s intangible assets, as well as loan portfolio impairments and higher taxes, offset by the release of loan reserves related to the transaction, Goldman said.
This follows a $504 million second-quarter impairment charge by GreenSky announced in July.
According to the press release, the Sixth Street group includes funds managed by KKR, Bayview Asset Management and CardWorks.
Private equity groups have played a key role in several banking industry asset sales since the start of the year, including providing financing for PacWest’s merger with Banc of California.
Read more: Goldman Sachs faces big writedown over CEO David Solomon’s ill-fated GreenSky deal