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Goldman Sachs Plans To Expand Cash Management To Europe Despite Coronavirus Impact

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Goldman Sachs Plans To Expand Cash Management To Europe Despite Coronavirus Impact

Goldman Sachs Group Inc. (NYSE: GS) is looking to expand its corporate cash management services across Europe starting September, the Financial Times reported Tuesday.

What Happened

While the investment bank's cash management platform is set to launch in the United States next month, it is also aiming to extend operating in the United Kingdom in September, and in other European countries by the end of the year, people familiar with the matter told the Financial Times.

Goldman Sachs is looking to implement a similar strategy as with its consumer-facing arm Marcus, when it comes to winning over clients from competitors, according to the Financial Times.

One person familiar with the matter told the Financial Times that the bank has been offering to pay as much as 200 basis points over rivals on some of the deposits to U.S. corporates.

Another person told the publication that the bank is offering pricing better than 70% of the market and not aiming to be the "most aggressive."

Why It Matters

Goldman Sachs reported a 46% drop in earnings in the first quarter and Chief Executive Officer David Solomon said the bank was "inevitably affected by the economic dislocation" caused by the novel coronavirus (COVID-19) pandemic.

The bank has been long planning to enter the corporate cash management market dominated by rivals HSBC Holdings PLC (NYSE: HSBC), JPMorgan Chase & Co. (NYSE: JPM), Citigroup Inc. (NYSE: C), and Deutsche Bank AG (NYSE: DB) for more than a year, as reported by Reuters in January last year.

GS Price Action

Goldman Sachs stock closed slightly lower at $179.93 per share on Friday.

 

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Posted-In: Covid-19 David Solomon EuropeNews Management Global Media General Best of Benzinga