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When David Solomon took over Goldman Sachs four years ago, he had big plans to remake the bank in his own image. Which is to say: obvious, commercial, accessible, competent and inoffensive. To do so, he’d build on the online lender Lloyd Blankfein set and up named, in what must called be the opposite of honor, for firm founder Marcus Goldman. There would be credit cards, embarrassing ads, mobile banking, more credit cards, mutual funds for the masses, bank accounts for online sellers and fintech galore.

Alas, while all of that was indeed as obvious, commercial and accessible as D.J. D-Sol’s Bahamian beats, many have proven less than competent. They’re also quite offensive to some pretty key people—Goldman’s shareholders—because not only do they not print money in the way that the parts of Goldman Solomon has consistently downplayed and degraded do, they actually accomplish the opposite.

At Goldman, pressure has been mounting on managers to tackle the consumer unit’s expenses. It became all the more acute this year, with analysts projecting profits will drop more than 40% from last year's record, prompting layoffs and reductions in bonuses.

At mid-year, the bank internally forecast that the unit’s losses would accelerate to more than $1.2 billion in 2022. That would set cumulative losses on path to exceed $4 billion.

And so, it seems, reluctantly, Solomon’s got to have another tough talk with the “Big Birds” out in Salt Lake City.

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

Consumer lending is being reined in. While the bank will keep credit-card partnerships, it will be very selective about adding to the list.

If only D-Sol had been able to pull off overpaying for Wells Fargo’s asset management arm the way he did for GreenSky, perhaps none of this would be happening. (It would.) Alas, he didn’t and so his dreams of investing every American’s 401(k) are over.

The pivot in consumer banking has also accelerated discussions for Solomon’s third big reorganization of Goldman’s business lines in four years. Goldman is mulling once again combining asset-management and wealth management businesses under a reconfigured leadership team, a move that would serve to further de-emphasize the consumer business.

Under Pressure, Goldman CEO Ditches Dream of Consumer Domination [Bloomberg]

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