Goldman Sachs Rethinks Retail

The elite bank’s effort to build a consumer brand has been expensive

David Solomon, the chief executive officer of Goldman Sachs Group Inc., jumped on a flight in 2019 to meet Reese Witherspoon. The Legally Blonde star-turned-mogul was toying with offering online financial services to her fans, and the head of Wall Street’s most prestigious bank wanted in. He saw it as a potential source of business for Marcus, Goldman’s foray into digital banking for the masses.

That moment may have been peak Marcus. Solomon, who’s spent much of his four years atop Goldman pitching shareholders and his own executives on the benefits of building a full-service digital bank, is now reeling in those aspirations and the resources dedicated to the project. (The meeting with Witherspoon didn’t lead to a deal.)

Cost overruns and missed profitability goals have set off discontent inside the bank, led to concerned questions from regulators, and brought about the dismay of shareholders. Now Goldman is restructuring and reorienting those operations, say executives with knowledge of the plans, who asked not to be identified describing internal talks. A spokesperson for the bank declined to comment.

Rather than catering to just about anyone, Goldman will sling some of its key consumer products through its wealth-management business. Checking accounts, once widely expected to get a big rollout to everyday consumers, will instead be steered toward well-to-do clients and employees at corporate partners. The same goes for the bank’s automated investment adviser, known as Marcus Invest, and savings accounts.