Goldman Sachs CEO says firm to raise ninth private equity fund

By Thomson Reuters Feb 27, 2024 | 8:32 AM

By Saeed Azhar

(Reuters) – Goldman Sachs CEO David Solomon said on Tuesday the firm will raise its ninth private equity fund this year.

“We’ll launch what we call Capital Partners IX… our next private equity fund, which will be a significant fundraising,” Solomon told investors at a conference in Miami.

He did not disclose the size of the new fund. In 2022, the Wall Street firm closed its eighth private equity fund, raising $9.7 billion.

Solomon said the firm’s goal was to attain mid-teen percentage returns for its global banking and markets business in the medium-term and projected strong margins for its asset and wealth management business.

He said “a little bit more work” was needed to narrow the focus of the consumer business.

Since 2022, Solomon has significantly scaled back the Goldman’s consumer ambitions by selling assets such as fintech lender GreenSky at a loss. He also shut down unsecured lending.

Solomon also said investment banking business was improving from a “super anaemic” period of activity during the second half of 2022 to the first half of 2023.

“It’s gotten better, but it’s not that good,” he said, comparing it to the 10-year average for the business.

“I don’t see any reason why the expectation over the next three years shouldn’t look more like 10-year averages.”

Goldman’s net profit dropped 24% to $8.52 billion last year, hurt by a slowdown in dealmaking and losses in its consumer business.

Despite the slide, the bank’s board awarded Solomon a 24% pay bump to $31 million in 2023, citing his moves to “clarify and simplify” Goldman’s strategy.

(Reporting by Saeed Azhar and Lananh Nguyen; Editing by Andrew Heavens and Ros Russell)