Goldman Sachs (NYSE:GS) is buying more capacity in the wealth management segment. The investment bank has agreed to buy fintech and financial services company Folio Financial, as confirmed by the latter on its website. Neither the price nor the terms of the transaction have yet been disclosed, although Folio promised to provide further details when the two parties near the close of the deal.
Folio is a Virginia-based company that has several business units, including custodial services and securities trading. All told, it has around $11 billion in assets under custody for registered investment advisors (RIAs).
Although Goldman also confirmed the acquisition, it has not yet made an official statement.
The company will fold Folio into its global markets division. It has a suite of products designed for RIAs, so the acquisition appears to be a move at complementing that business.
This is not the first time in recent history that Goldman has bought out a company active in the wealth management sphere. In 2019, it purchased United Capital for $750 million. It has since folded the once-independent company into its own operations and branded it Goldman Sachs Personal Financial Management.
These acquisitions are part of a broader push by Goldman to diversify its operations away from its traditional investment banking core. For example, in 2016, it launched Marcus, a service described as a "dynamic consumer finance platform." Essentially, Marcus is a bank with familiar and traditional features such as savings accounts, personal loans, and credit cards for qualifying consumers.
On Thursday, Goldman shares essentially moved in concert with the wider stock market, rising to close just over 1.5% higher on the day.