Goldman will pay about $2.5bn for the portfolio, which has roughly that amount in outstanding balances, to the previous owner, Capital One. The deal was not yet finalised, one of the people said. The agreement was first reported by The Wall Street Journal. Goldman had $2.3bn in card loans as of the end of the second quarter. But while that will now more than double, the total will remain small relative to the bank’s $1.1tn in assets. In a note to clients, Brian Kleinhanzl, banking analyst at KBW, wrote that Goldman appeared to be paying a “small premium” for the portfolio. Assuming the asset had an 8 per cent yield, he said the deal would be slightly accretive to Goldman’s earnings next year. “Management is executing on the strategy laid out at investor day” in January, he wrote. Goldman’s core businesses in trading and capital markets has become less profitable and less appealing to investors, due to higher capital requirements and a widespread shareholder aversion to earnings volatility.

https://amp.ft.com/content/512a9efd-3b0d-4f57-a3e5-b7735b9b518c?desktop=true&segmentId=d8d3e364-5197-20eb-17cf-2437841d178a&__twitter_impression=true