Goldman Sachs Group Inc (NYSE:GS) Q4 2019 Earnings Conference Call - Final Transcript

Jan 15, 2020 • 09:30 am ET

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Goldman Sachs Group Inc (NYSE:GS) Q4 2019 Earnings Conference Call - Final Transcript

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Q & A
Operator
Operator

[Operator Instructions] And your first question is from the line of Glenn Schorr with Evercore. Please go ahead.

Analyst
Glenn Schorr

Hi, thanks very much. I don't know what to expect on this one. So doing more lending across the franchise, and it clearly is working, and you now break out for us intermediation versus financing in trading or in markets, and I think there is opportunity to do more there, some of your peers do a lot more on the financing side. So a small question is, are we going to see more at Investor Day in terms of metrics that we can help model and build and evaluate performance on? And that's question one. And then question two on that is, can -- how quickly can you expect those to, a, grow and, b, enhance returns over the next year or two?

Executive
Stephen M. Scherr

Sure. Thanks, Glenn. It's Stephen, I'll take -- I'll take your question. I guess on the small question you asked, which is, should you expect more disclosure and the frequency of it, I think the answer is ultimately, yes. As it relates to lending broadly around the firm, there are a number of categories of lending that will over time become more material. And as they become more material, we will both by obligation, but equally by interest look to provide incremental more information on that lending. I would say, consumer is a good example of that as between unsecured consumer lending and equally what we're doing on the credit card side. I think broadly speaking in lending, I would say, mindful of the cycle, our clear plan is to grow financing revenues in both FICC and equities, to answer your direct question.

And I would say, the type of lending that's going on there is largely in the repo business, in FICC, it's in prime and equities. I think from a credit risk point of view, we like and can digest and evaluate that risk, notwithstanding where we sit in the cycle more broadly. And I think, metrics in Global Markets around that lending, again, will continue to grow out. Last thing I'll say, as it relates to Investor Day, look, we're going to lay out certain targets at the enterprise level. We will be more disclosive of about individual businesses. But I think equally important, Investor Day will be the beginning and not the end of a dialogue around this, so that the numbers just don't standalone, and we give you context for rate of growth and how we're managing it.

Analyst
Glenn Schorr

Okay. I appreciate anything there. And then on the -- on the expanding the corporate client base, the specific question I have is, are you fully cut over on processing Goldman's cash management payments, and where are we in terms of dialogue with signing on any clients?

Executive
Stephen M. Scherr

Sure. So in transaction banking, as we have said from its inception, we would be the first customer and then we would look to bring on clients of the firm.