Goldman Sachs Abandons Online Platform To Focus On Ultra-Wealthy Clients

by Philip Morton, InvestorsOffshore.com

24 April 2001

The private wealth management business of Goldman Sachs, the US investment banking and securities giant, seems to be in a state of flux. The US press reported last week that its online platform, GS.com, has been disbanded and a Goldman official is reported to have said that the company will no longer be handling the accounts of many clients who do not meet its US$25m account minimum.

Brokers who service the online clients (those with less than US$25m) are either being laid off or absorbed into the Private Wealth Management group. However, not all GS.com clients will find themselves out on a limb and the company says circumstances surrounding those accounts will be assessed.

InvestorsOffshore.com reported in March that Goldman was revamping its online business in order to cater for investors with $25m or more of assets to play with. Goldman Sachs was also planning to change the way clients using its online wealth platform are dealt with, choosing like other financial services players to adopt the more "personal touch." However, industry sources are saying that decision has been scrapped and now the entire online wealth effort has been abandoned.

Goldman has been steadily moving in on the very affluent over the past year, and the closing down of its online platform reflects its change in strategy, epitomised by the company's recently-introduced bonus plan for brokers, designed to encourage and reward brokers who bring in the ultra-high net worth accounts.

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