Deposit growth is top of new Goldman banking chief’s to-do list

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When Carey Halio takes the helm of Goldman Sachs’ banking arm next month, she will do so at a time when the competition for deposits — particularly for consumer deposits — is heating up.

Halio on Monday was named the next CEO of Goldman Sachs Bank USA. In an interview with American Banker, Halio, who is currently the unit’s chief financial officer, said that expanding and diversifying the company’s deposit base is at the top of her agenda.

Goldman has roughly $127 billion in total deposits, mostly from private wealth and commercial customers. Over the past few years, it has diversified its deposit base by expanding into consumer banking, following its 2016 acquisition of an online savings platform from GE. Since then the consumer deposits have grown rapidly, more than tripling to about $26 billion.

As it stands today, though, Goldman’s consumer business — which operates under the Marcus brand — primarily offers secondary accounts for customers looking for higher returns on their savings. In her new role, Halio will oversee the expansion into new products and services as the company aims to compete with brick-and-mortar banks for long-term customer relationships.

“It’s a simple platform today — we have a core savings product and [certificates of deposits] — and we’re looking to expand that product suite for customers, giving them more options,” Halio said.

In addition to offering online savings accounts, Goldman offers personal loans under its Marcus brand. Halio declined to discuss plans for future products or services. However, the current bank CEO, Stephen Scherr, who will be moving up in the company, said in a later interview that checking is “an example of the kind of services that we would think about.”

As retail customers grow more accustomed to banking through online and mobile channels, online banks such as Marcus stand to benefit, Halio said.

“There’s a lot of opportunity for growth there,” she said.

Over the past few months, several big banks — including JPMorgan Chase, Citigroup and Citizens Financial Group — have said they would establish online-only banks, with a focus on boosting deposits.

The promotion of Halio to CEO comes as part of a broader leadership reshuffling at Goldman, as David Solomon, who currently serves as president, prepares to take the helm on Oct. 1, succeeding Lloyd Blankfein.

The New York company last week named John Waldron, an investment banking executive, as president and chief operating officer. Scherr will serve as chief financial officer, and Halio will report to him.

In promoting Halio as head of the $177 billion-asset bank, Goldman has selected a company lifer with a long tenure in credit and risk management. Before being named CFO of the banking unit in 2014, Halio spent the bulk of her career in focusing on credit exposure, in varying roles within the company’s financial institutions group.

“She brings with her a professional history within the risk organization, which comes as a sixth sense, if you will, about where risks lie and how to manage to and around them,” Scherr said.

Scherr also praised the “longstanding relationships” that Halio has developed throughout across the company.

As CFO of the bank, Halio has been instrumental in building Goldman’s consumer business, which is led by former Discover Financial Services executive Harit Talwar. Additionally, she has played a key role in upgrading the internal infrastructure needed for Goldman to expand into commercial cash management and to increase lending to private banking customers.

As the bank's CEO, Halio will be essential in helping Goldman meet its goal of adding $5 billion in revenue over the next three years, Scherr said.

“Carey has both a history, and I think a temperament, as well as a base of business knowledge to act as a very, very significant partner to those who lead businesses inside the firm,” Scherr said.

With her promotion, Halio will become one of the highest-ranking women at the Wall Street investment firm. Promoting more women is a key priority for Goldman, according to Scherr, who has served as CEO of the banking division for two years.

For Halio, the path to the banking division’s corner office began in a nontraditional place: Guatemala.

After college Halio joined the Peace Corps, where she helped women business owners, such as local weavers, establish a community bank. Her job was to help women who had received capital through the initiative think about the fundamentals of business planning — including how to set the price of their goods so that they could turn a profit and cover their costs.

“It was an amazing experience for me,” Halio said. “It really shaped me.”

After finishing her two years of service, Halio enrolled in Columbia Business School, with the initial goal of going into international development. But she said she switched her focus to banking, instead, after she learned that organizations such as the World Bank were looking for candidates with “substantive finance experience.”

Halio interned with Goldman in 1999. The following year, after she graduated from Columbia, she accepted a full-time job with the company in the credit risk division.

Halio said she quickly realized that she enjoyed the work and has always felt challenged.

“I never really looked back,” she said.

Halio lives in Connecticut with her husband and two sons, ages 5 and 8.

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