U.S. investment bank Goldman Sachs (GS) is planning to sell part of its wealth management business as it moves to focus on serving ultra-rich clients.
Goldman Sachs is evaluating the sale of its investment adviser unit called “Personal Financial Management” (PFM), which manages about $29 billion U.S. of assets, the company said in a news release.
Goldman Sachs purchased the investment adviser unit for $750 million U.S. in 2019 when it managed about $25 billion U.S. of funds.
The acquisition was aimed at broadening the bank’s clients beyond the ultra-rich, but the unit has remained a small part of the Goldman’s overall wealth management business and the company is now looking to offload it.
Goldman Sachs’ private wealth management business overall manages $1 trillion U.S. in assets for high-net-worth clients around the world.
The divestment of PFM comes after Goldman Chief Executive Officer (CEO) David Solomon reorganized the bank into three units and scaled back ambitions for the company’s consumer business.
Goldman’s financial technology (fintech) business called “GreenSky” is also currently for sale.
Solomon is under pressure from investors to turn around Goldman’s business after its profits declined 60% in this year’s second quarter as write downs on its consumer businesses and real estate investments hurt earnings.
Goldman Sachs now plans to pivot back to its original focus on managing money for ultra-wealthy clients. Offerings for the superrich include brokerage and mortgage services, as well as estate and tax planning.
The stock of Goldman Sachs has declined 5% over the last 12 months to trade at $324.93 U.S. per share.