Goldman Sachs Plans Shift From Revenue Goal at First Investor Day

NEW YORK—More than two years ago, Goldman Sachs Group Inc. told investors it would find $5 billion in fresh annual revenue by 2020. Now, the bank may move away from that goal to focus on a wider range of metrics.

The new targets, to be outlined by Chief Executive David Solomons management team in January at Goldmans first-ever investor day, could include a broad efficiency ratio and profitability measures, four sources familiar with the matter said.

They could also include narrower items, such as goals for Goldmans fledgling retail bank, Marcus, according to some of the sources, who spoke on condition of anonymity.

The change of focus signals that Goldman wants to match rivals that disclose progress toward broader targets, and satisfy demand among investors for transparency across all the banks businesses, according to the sources, who cautioned that plans for the investor day are still taking shape and could change.

The shift also illustrates how, under pressure from investors unhappy with a near-20% fall in its share price since March last year, Goldman is having to overhaul the way it communicates with shareholders.

“Right now the story is were Goldman Sachs, trust us and well generate good returns. The collective investment community is saying that doesnt cut it,” said Wells Fargo analyst Mike Mayo. “They need to provide something that increases confidence, so for the first time ever theyre going to lift the curtain behind the scenes at Goldman Sachs.”

Goldman declined to comment on the $5 billion goal or what new targets might be unveiled at the investor event in January. It referred Reuters to an interview on Nov. 11 in which Solomon said there would be no major disclosures.

“Weve got very, very good businesses that were very proud of and wed like to evolve those businesses a little bit. I wouldnt expect any big reveal,” he told Bloomberg TV.

The $5 billion target was at one time a crucial benchmark for whether Goldman could transform itself from a Wall Street trading house with stalling profits into a more diversified bank with potential to grow, analysts said.

In the early days of his tenure, it was also an important metric for Solomon, who took the reins from longtime CEO Lloyd Blankfein in October 2018. The 57-year-old was a key architect of Goldmans overhaul plan in his prior role as operating chief, sources within the bank said.

Goldman executives said a year ago that the bank was ahead of schedule on the $5 billion goal.

There is a lot of appetite among investors for information about Goldmans progress redRead More – Source