As part of a broader strategic retreat from its consumer banking foray, Goldman Sachs (NYSE:GS) Bank has announced plans to transfer its GM and Apple (NASDAQ:AAPL) credit card services to another lender. This move comes in the wake of the bank divesting from several retail banking operations, signaling a shift back to its core strengths.
The decision to offload the GM credit card business, which Goldman Sachs acquired from Capital One for $2.5 billion in October 2020, aligns with its current approach to streamline operations. The bank's Platform Solutions division, responsible for the GM credit card program offering rewards for vehicle owners, is actively seeking a new issuer for this service.
In addition to the GM credit card, Goldman Sachs is also considering a sale of its Apple credit card scheme, which was launched in 2019. CEO David Solomon has underscored the importance of focusing on the company's central franchises during a period marked by a contraction in their consumer business segment.
The transition of these credit card services is part of a larger trend at Goldman Sachs, following the sale of their personal loan business that was integrated via the acquisition of GreenSky in 2022. While American Express (NYSE:AXP) has been mentioned as a potential suitor for the credit card portfolios, the future ownership of these services is yet to be confirmed.
Goldman Sachs' pivot away from consumer lending has been attributed to high costs stemming from its unsuccessful expansion efforts in this area. The Wall Street Journal reported Today that this strategic realignment is an acknowledgment of the challenges faced by the bank in competing within the consumer finance market.
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