Goldman Sachs unveils ambitious plans for $300 billion private credit expansion

Goldman Sachs outlines a strategic plan for expanding its private credit portfolio from $130 billion to $300 billion in five years

Goldman Sachs is embarking on a strategic expansion to grow its private credit portfolio from $130 billion to $300 billion over the next five years.

Led by Marc Nachmann, Global Head of Asset and Wealth Management (GSAM), the move positions the firm competitively against Morgan Stanley and JP Morgan Chase in the private credit space.

Goldman Sachs plans to raise $40 billion to $50 billion for alternative investments this year, allocating a significant portion to private credit strategies.

The firm’s nearly three-decade presence in private credit includes strategic collaborations with private equity giants and asset managers.

In anticipation of potential staff turnover amid the expansion, Nachmann emphasizes sustained employee morale, with ongoing recruitment efforts across asset and wealth management.

Beyond private credit, Goldman Sachs seeks to optimize GSAM’s return on equity to a mid-teens percentage by divesting internal investments.

The rapid reduction of legacy investments from $30 billion to $16.3 billion reflects progress in this strategic direction.

Looking ahead, Goldman Sachs aims to extend its global reach by targeting ultra-high-net-worth clients in Europe and Asia within the $1 trillion wealth management sector.

This involves expanding the advisor base and increasing lending to private bank clients, with a confident projection of doubling the international wealth business over the next few years.

Goldman Sachs also recognizes the untapped potential for wealth management lending, which currently stands at 3% compared to the industry average of 9%, presenting an opportunity for strategic growth.

Source: Newsroom

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