Goldman Sachs is betting that you’ll want a $10,000 home improvement loan from the investment bank

cnbc.com:

Goldman Sachs, the 153-year old investment bank, is now officially in the home improvement loan business as it continues a push into the finances of ordinary Americans.

The bank expects to add one million customers a year to its budding Marcus retail division through the acquisition of GreenSky, announced in September at a $2.2 billion price tag, Goldman executives said in their first interview after the deal closed Tuesday. GreenSky is an Atlanta-based buy-now, pay-later fintech firm that focuses on construction loans with an average $10,000 size.

«It a great acquisition engine because we expect to bring a million new customers annually through this distribution we're adding to the Marcus ecosystem,» said Swati Bhatia, a Goldman partner and former Stripe executive. These customers will be able to use the firm's Marcus app, where they will be offered the bank's other products, including savings, personal loans and an expected digital checking account later this year, she said.

The move has broad implications for Goldman investors as it ramps up its ambitions in consumer finance, bringing increased opportunities — and risk. Goldman will start originating GreenSky's loans using its own $1.5 trillion balance sheet in the next few months, according to Bhatia, replacing the bank partners GreenSky had leaned on when it was independent.

That will add potentially billions of dollars of new loans onto its balance sheet, which should serve as an engine for generating the type of interest income that powers larger retail rivals like JPMorgan Chase and Wells Fargo.

As a result, Goldman — which typically touts it ability to manage risk as it added products like the Apple Card to its portfolio — will be more exposed to the