Federal Reserve approves Goldman Sachs' purchase of GE Capital's US online deposits
Goldman Sachs Bank USA (GS Bank) has secured approval from the Federal Reserve to acquire the online deposit platform and assume the deposits of GE Capital Bank (GECB).
As per the proposal, GS Bank would assume about $17bn of GECB's $18.2bn in deposits.
The purchase also includes various technology and intangible assets used by GECB to manage its online retail deposit-taking platform. The assets represent around 1% of the bank's total assets.
As part of the deal, Goldman Sachs Bank's will extend offers of employment to all of GECB's employees who support the online deposit platform.
The transaction does not include the acquisition of any physical assets as GECB's deposit platform is online only.
GS Bank is a New York State-chartered bank that is a wholly-owned, direct subsidiary of The Goldman Sachs Group.
The bank is a member of the FDIC and Federal Reserve System and is subject to the regulation and supervision of the Federal Reserve, the New York State Department of Financial Services and the Consumer Financial Protection Bureau.
On consummation of the proposal, Goldman Sachs would control about $95.1bn in deposits via GS Bank.
The Federal Reserve had extended the initial comment period for the agreement and received feedback from 84 individuals and organizations that both opposed and supported it.
About 31 respondents submitted comments supporting the proposal and nearly 53 commenters submitted comments either opposing the proposal, requesting that the board approve the deal only subject to several conditions.
Image: Goldman Sachs Headquarters, New York City. Photo: courtesy of Quantumquark.