NEW YORK (Reuters) - Goldman Sachs Group Inc (GS.N) President and Chief Operating Officer John Waldron said Wednesday that the bank remains on track to achieve its medium and long term growth targets despite the economic shocks caused by the novel coronavirus.
However, the economic shutdown has caused some negative impacts, and the bank will be slowing down hiring plans for its private wealth management division and delaying the launch of a digital wealth management product to next year, Waldron said.
Waldron was speaking at a virtual conference to investors and analysts who are listening closely for indications on the financial health of the largest U.S. banks and their predictions for an economic recovery.
Goldman’s economists predict a 4% contraction in global gross domestic product in 2020 and continued high U.S. unemployment, Waldron said.
Given these negative indicators, the bank will stick to limiting growth in its consumer loan portfolio, which includes credit card balances and unsecured personal loans, he said. reut.rs/35GAGXe
However, the crisis has created unexpected growth in some of Goldman’s newer businesses. Deposits in Goldman’s Marcus savings accounts rose to $80 billion as of late May, up from $72 billion on March 31. The bank also now has over 175 large and medium-sized corporate clients using its cash management platform, Waldron said.
Unlike rivals JPMorgan Chase & Co (JPM.N), which said it may need more time to achieve growth targets set earlier this year, Goldman can still meet its January targets of a 60% efficiency ratio, a 13% return on equity and a return on tangible equity higher than 14%, Waldron said. reut.rs/36DxIBR
“We are running the firm for medium and long term targets,” Waldron said. “We are not deviating.”
Reporting By Elizabeth Dilts Marshall; Editing by Nick Zieminski