Goldman Sachs is raising rates for savers


Goldman Sachs CEO Lloyd Blankfein
Goldman Sachs CEO Lloyd
Blankfein.

REUTERS/Gary
Cameron

 

(Reuters) – U.S. savers who routinely scour personal finance
sites for the best deposit rates are soon going to see an unusual
bank at the top of the list: Goldman Sachs Group Inc.

The Wall Street bank's consumer arm, Goldman Sachs Bank USA,
plans on Wednesday to raise the rate it offers customers on
deposits to 1.2 percent, slightly higher than rivals Synchrony
Bank, CIT Bank and New York Community Bank's My Banking Direct.

Goldman had previously offered savers 1.05 percent. The average
national rate for savings accounts is currently 0.06 percent,
according to the U.S. Federal Deposit Insurance Corporation.

The move makes Goldman the highest interest paying bank,
according to personal finance website Bankrate.com. The firm is
aggressively trying to boost its deposit base and attract Main
Street clients.

Goldman's online deposits from individuals total $12 billion, a
small but growing fraction of the $128 billion in overall
deposits on the firm's overall balance sheet. Still, that is far
less than large commercial banks like JPMorgan Chase & Co
with $1.4 trillion in deposits.

Goldman hopes increasing its deposit base will help it boost
profits if it can find ways to lend them profitably. The bank is
looking to make further inroads into lending broadly across
wealth management and investment banking, as businesses like
trading struggle to generate the type of returns they once did.

Deposits also represent a more stable type of funding and are
less likely to disappear during times of stress than other
funding sources. Regulators may have been pushing banks to rely
more on deposits since the 2008 financial crisis.

Last year, the bank launched Marcus, its first major foray into
consumer lending. It also acquired Honest Dollar, an online
retirement savings platform for small businesses and startups.

(Reporting by Olivia Oran in New York; Editing by
Bernard Orr)

Get the latest Goldman Sachs stock price here.

Read the original article on Reuters. Copyright 2017. Follow Reuters on Twitter.

 

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