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rs - goldman sachs developing in house private bank

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beethoven

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http://www.rawstory.com/rs/2012/07/18/goldman-sachs-developing-in-house-private-bank/

Goldman Sachs developing in-house private bank

By Agence France-Presse
Wednesday, July 18, 2012 1:36 EDT

Goldman Sachs said Tuesday it is developing its private bank for wealthy clients, particularly in fast-growing countries and in Europe, where it hopes to pick up the slack from struggling local banks.

“We’ve been in the wealth business for a long time,” said David Viniar, Goldman’s chief financial officer, said in a teleconference.

With certain European banks retrenching amid the eurozone debt crisis, he said, “there are some of our clients that need dollar funding.”

“We’re growing the private bank out of the US,” he said, noting that today it was “very small but something we intend to grow very rapidly.”

The in-house private bank currently has a little over $100 billion in assets and about $50 billion in deposits, he said.

Viniar said Goldman was building up the deposits and would use them for lending to companies and wealthy people.

Goldman’s drive to build its private bank comes as the prestigious Wall Street giant seeks to offset a decline in its core investment business amid global economic turbulence and looming new regulations that will ban banks from trading using their own funds.

Viniar said that Goldman sees potential opportunities as banks scale back in Europe.

“In the near term it could be a meaningful opportunity for us but we haven’t seen it yet,” he said.

“We continue to be optimistic about the growth markets,” despite a current slowdown, he added.

His comments came against the backdrop of stuttering growth in key drivers of the global economy, such as China, India and Brazil, largely in response to the eurozone crisis.

A Goldman spokeswoman contacted by AFP said that Goldman’s exposure to the sovereign debt of Greece, Spain, Portugal, Ireland and Italy totaled $2.5 billion.

She declined to say whether the bank was prepared for a possible breakup of the 17-nation bloc that shares the euro. On Monday, Citigroup’s chief financial officer said the bank was ready for that “eventuality.”

Earlier Tuesday, Goldman reported second-quarter profits fell 12 percent from a year earlier, to $927 million, and were down some 55 percent from the first quarter’s record $2.07 billion.

“During the second quarter, market conditions deteriorated and activity levels for both corporate and investing clients were lower given continued instability in Europe and concerns about global growth,” chief executive Lloyd Blankfein said in a statement.

[Business man handing cash to another person, loaning money, via Shutterstock.com.]

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hypocritexposer

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Goldman Sachs, the private bank, is developing a "private bank"


So what is the story here?


Maybe this new "private bank" will require collateral, before they give out loans, unlike what they are required to do for the "less rich", by government mandate.

:roll:
 

beethoven

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http://www.cbc.ca/news/business/story/2012/07/17/goldman-sachs-bank.html

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