Goldman Sachs to Report $2 Billion Loss in Credit Card Division, Cut 3,200 Jobs

Goldman Sachs is reportedly reporting a loss of $2 billion losses in the credit card and bridge lending industries .

Platform Solutions were exacerbated by new accounting rules that required the company to set aside more money as loan volumes grew, Bloomberg reported on January 8. a source familiar with the matter.

The company is also cutting 3,200 jobs, the largest round of layoffs ever. It will begin the cuts this week, with up to 3,200 workers affected in total.

The job cuts are part of a wave of bank layoffs stemming from a global decline in mergers and acquisitions and other deals.
More than a third of the layoffs will come from Goldman’s trading and banking units, Bloomberg reported. A Goldman spokeswoman declined to comment Sunday night.

The report notes that the job cuts come the same week that Goldman Sachs holds its annual year-end pay talks. According to the report, those numbers are expected to decrease, especially for those who work in investment banking. The news comes weeks after it was reported that Goldman’s layoffs could reach up to3,000 employees. 

The cuts are due to the dismissal of 500 workers in September. It also revealed plans last month to cut hundreds of jobs linked to its retail banking business, a figure that is included in major redundancies.

Last year, Goldman also embarked on one of the biggest restructurings in its more than 150-year history, splitting itself into three divisions: investment banking and trading, wealth and asset management, and transaction banking. The change concerned the merger of Marcus retail banking with the bank’s wealth unit.

CEO David Solomon told analysts at the time that Goldman Sachs’ new direct-to-consumer (D2C) strategy meant focusing on “existing depositors and consumers” that the bank already has access to through channels like employment and personal wealth, rather than trying to capture “clients in droves.”
According to Bloomberg, layoffs at investment banks have also hit European financial centers. Citi, Barclays, Credit Suisse, Deutsche Bank, and Lloyds have all cut staff along with their investment banking teams as the investment banking downturn has hit European operations particularly hard. and institutional customer service functions.
Global M&A activity was at a record low in the last six months of 2022. Business volume fell from $2.2 trillion in the first half of 2022 to $1.
trillion in the second half of 2022.

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