Friday, August 14, 2015

Is Goldman Sachs Preparing for Another Financial Crisis?

Goldman Sachs has announced that it just bought GE Capital Bank’s online deposit platform , with it comes $16 billion in deposits.

The amount includes about $8 billion in online deposit accounts and $8 billion in brokered certificates of deposit.

The transaction furthers Goldman's strategy of becoming less reliant on capital markets for funding. Capital funding is much more vulnerable to high rates and funding difficulties during financial crisis than the retail accounts that are the source of the Capital Bank deposits.

With this acquisition,  Goldman picks up a bank that has no minimum for online savings accounts and roughly 140,000 retail customers—a departure for a firm that has historically catered to institutions and wealthy individuals.


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