Marcus by Goldman Sachs Bank

[hyphen]

JaredVannett said:

Jimmy Recard said:

But how does this negatively affect people who want to deposit money but will not have any need for a loan?

I’m really struggling to see it

Good point.

You can put a maximum of £250k into Marcus bank. So the 'max' a small percentage of people will 'make' is around £3-4k.

Which if you have £250k in cash lying around isn't a big deal, and many people won't want to put that much in a single account, as not covered by the UK banking compensation amount, so not worth the risk.

Most will be entering into bed with Goldmans for a few hundred quid at best - put in £1k and you will earn £15 for the year... Rate drops after first year, and they can also drop it at any point earlier.

Is £15 worth encouraging the growth of goldman sachs into the consumer market!

Edited by hyphen on Wednesday 3rd October 12:59

[Jimmy Recard]

hyphen said:

The devil doesn't come to you promising doom and gloom, he offers you an incentive to get into bed with him.

Traps don't work without bait.

I can go on all day

Go on all day about nothing?

I doubt I’ll ever take a loan in the future, apart from mortgages maybe.

Even if I do, there are options other than Goldman Sachs.
Unless you think Goldman Sachs will steal my deposits, I’m not following

[hyphen]

Jimmy Recard said:

Go on all day about nothing?

I doubt I’ll ever take a loan in the future, apart from mortgages maybe.

Even if I do, there are options other than Goldman Sachs.
Unless you think Goldman Sachs will steal my deposits, I’m not following

How much are you going to put in, and how much will you gain in interest?

[Jimmy Recard]

hyphen said:

How much are you going to put in, and how much will you gain in interest?

Some money and I will gain in interest more than I would have gained in the account that previously held it. Isn't that the crux?

[funinhounslow]

Jimmy Recard said:

Go on all day about nothing?

I doubt I’ll ever take a loan in the future, apart from mortgages maybe.

Even if I do, there are options other than Goldman Sachs.
Unless you think Goldman Sachs will steal my deposits, I’m not following

Me either, and I find the references to rape, getting "bent over without lube", and giant octopuses or whatever ridiculous in relation to a consumer savings product.

I wish someone would just tell me clearly what I've set myself up for by opening an online savings account.

I am just waiting for a link to some YouTube "documentary", probably in the form of a cartoon...

[hyphen]

funinhounslow said:

Me either, and I find the references to rape, getting "bent over without lube", and giant octopuses or whatever ridiculous in relation to a consumer savings product.

I wish someone would just tell me clearly what I've set myself up for by opening an online savings account.

I am just waiting for a link to some YouTube "documentary", probably in the form of a cartoon...

Good for you, just be an informed customer.

https://www.rollingstone.com/politics/politics-new...

[DonkeyApple]

Cheib said:

It's really very simple...it's a cheap way for GS to borrow money...i.e. if they go to the wholesale markets it would cost them more to borrow money than it does to give savers these interest rates through "Marcus". Same principal as with the Icelandic Banks back in 2008...they were paying what people thought were amazing rates to borrowers because in their case they had been shut out of the wholesale markets.

The concept of Marcus is about lending rather than holding small deposits. The deposit side will be a lost leader in reality as the cost of compliance and maintenance of a huge retail client base will almost certainly outweigh what they can earn from the 50% or so that they can invest into medium/longer term yielding pools.

Lending on the other hand is highly lucrative as firstly the amounts dwarf deposit amounts so you’re going to be earning from much larger base sums. And on top of that, you’re going to have around 5%+ markup on that book.

In extremely crude terms you have the current account deposit side which costs you 1.5% but you can only work on the institutional side with about half the funds deposited so your effective cost is 3% and the 50% you put out in the market isn’t going to yield much over that. It’s a really poor business like discount share trading but a really cost effective client acquisition tool for upselling high margin goods and services to. On the lending side, you probably write at least 5x the value of your deposit business, we are a consumer debt fuelled society with far more borrowing than cash savings. And the margins are several times larger.

In short, I think Marcus is a lending house that aquires customers through a marketing model based around headline grabbing deposit accounts. Which I think is what others are saying.

[Jimmy Recard]

hyphen said:

Good for you, just be an informed customer.

https://www.rollingstone.com/politics/politics-new...

I’ve seen that conspiracy type article pop up here before. I just don’t see it’s relevance to me or any other person who opens a savings account

[Jimmy Recard]

DonkeyApple said:

The concept of Marcus is about lending rather than holding small deposits. The deposit side will be a lost leader in reality as the cost of compliance and maintenance of a huge retail client base will almost certainly outweigh what they can earn from the 50% or so that they can invest into medium/longer term yielding pools.

Lending on the other hand is highly lucrative as firstly the amounts dwarf deposit amounts so you’re going to be earning from much larger base sums. And on top of that, you’re going to have around 5%+ markup on that book.

In extremely crude terms you have the current account deposit side which costs you 1.5% but you can only work on the institutional side with about half the funds deposited so your effective cost is 3% and the 50% you put out in the market isn’t going to yield much over that. It’s a really poor business like discount share trading but a really cost effective client acquisition tool for upselling high margin goods and services to. On the lending side, you probably write at least 5x the value of your deposit business, we are a consumer debt fuelled society with far more borrowing than cash savings. And the margins are several times larger.

In short, I think Marcus is a lending house that aquires customers through a marketing model based around headline grabbing deposit accounts. Which I think is what others are saying.

I suspect you’re exactly right and this has been my opinion of any account with decent interest for some time.

Ultimately, as a depositor, I don’t see the downside versus depositing that money in an account that pays me a lower rate of interest.

I’m talking purely about savings accounts, not investments. I keep that separate

[DonkeyApple]

funinhounslow said:

I am just waiting for a link to some YouTube "documentary", probably in the form of a cartoon...

Done.

https://youtu.be/Lx4poQw1mZo

[hyphen]

Jimmy Recard said:

I suspect you’re exactly right and this has been my opinion of any account with decent interest for some time.

Ultimately, as a depositor, I don’t see the downside versus depositing that money in an account that pays me a lower rate of interest.

I’m talking purely about savings accounts, not investments. I keep that separate

Why not stick it your lump sum into a fixed account? You will earn more than 1.5%.

a quick glance shows 1 year of 2.01% and 2 year of 2.26%

Goldmans are laughing all the way to the bank (pun intended) with the free PR machine rolling into action and grabbing the news headlines, the next bank down is offering 1.4% but does it have a PH thread for it? Nope. Not exactly a massive difference in how much you will make between 1.5 and 1.4 for your average savings depositor who won't have £250k.

As your gran may have told you about that naughty kid, "best not to encourage them"

Edited by hyphen on Wednesday 3rd October 13:52

[Jimmy Recard]

hyphen said:

Why not stick it your lump sum into a fixed account? You will earn more than 1.5%.

a quick glance shows 1 year of 2.01% and 2 year of 2.26%

Goldmans are laughing all the way to the bank with the free PR, the next bank down is offering 1.4% so not exactly a massive different in how much you will make.

I’ve got a couple of accounts like that, as well as S&S ISA, investments outside ISA, SIPP and a couple of current accounts which pay more interest on smaller amounts.
This is money that I want to have instant access to, and this seems to be the best rate I’ll get, having used up the alternatives. I switched from 1.3 Tesco Bank to 1.5% Marcus for it, so clearly I don’t mind chasing a marginally better rate if it’s there

[NickCQ]

DonkeyApple said:

In short, I think Marcus is a lending house that aquires customers through a marketing model based around headline grabbing deposit accounts. Which I think is what others are saying.

Exactly. Securitise the consumer loan book and place / repo the senior tranches. Deposits are just a cheap mezz tranche.

[gibbon]

I have a large purchase coming up, I will need the cash in dribs and drabs in roughly 6m to a year, maybe up to 18 months, i cant be sure exactly. I have the money set aside now, i do not want to risk it in investments, I have other funds for that.

This is by far the best account I have seen for flexible (relatively) high returns on deposits that i can quickly add, and quickly remove.

I don't mind if Goldmans have access to my details to try to sell me other products that I don't require, frankly they join the line of establishments that do this.

Edited by gibbon on Wednesday 3rd October 14:03

[funinhounslow]

hyphen said:

funinhounslow said:

Me either, and I find the references to rape, getting "bent over without lube", and giant octopuses or whatever ridiculous in relation to a consumer savings product.

I wish someone would just tell me clearly what I've set myself up for by opening an online savings account.

I am just waiting for a link to some YouTube "documentary", probably in the form of a cartoon...

Good for you, just be an informed customer.

https://www.rollingstone.com/politics/politics-new...

That eight year old article from Rolling Stone? Nothing recent from The Economist or FT then...?

You may as well link to an article in NME or Smash Hits

[hyphen]

funinhounslow said:

hyphen said:

funinhounslow said:

Me either, and I find the references to rape, getting "bent over without lube", and giant octopuses or whatever ridiculous in relation to a consumer savings product.

I wish someone would just tell me clearly what I've set myself up for by opening an online savings account.

I am just waiting for a link to some YouTube "documentary", probably in the form of a cartoon...

Good for you, just be an informed customer.

https://www.rollingstone.com/politics/politics-new...

That eight year old article from Rolling Stone? Nothing recent from The Economist or FT then...?

You may as well link to an article in NME or Smash Hits

Latest entry is 2015...
https://en.wikipedia.org/wiki/Goldman_Sachs_contro...

[Funk]

Shnozz said:

Nationwide do 3% up to £2.5k I think on their flex plus account.

...the account costs £13/mo which wipes out the interest you'd earn (I have one, the insurance features are good value and make it worth it for travel, mobile etc). I prefer to look at it as the interest offsets the cost of the account!

[bad company]

funinhounslow said:

Jimmy Recard said:

Go on all day about nothing?

I doubt I’ll ever take a loan in the future, apart from mortgages maybe.

Even if I do, there are options other than Goldman Sachs.
Unless you think Goldman Sachs will steal my deposits, I’m not following

Me either, and I find the references to rape, getting "bent over without lube", and giant octopuses or whatever ridiculous in relation to a consumer savings product.

I wish someone would just tell me clearly what I've set myself up for by opening an online savings account.

I am just waiting for a link to some YouTube "documentary", probably in the form of a cartoon...

I may be wrong here but I ‘thing’ Goldman Sachs have to comply with the same laws as others.

There’s some paranoia on this thread.

[daddy cool]

sas62 said:

Anyone had any delays on transfers in?

Did a test £100 from Santander and it showed up almost instantly.

Then did 20k which failed on the Santander side (no reason given from telephone support).

Then did the 20k again on internet banking while on the phone to support and it left Santander straight away. Both available & actual balance has debited the 20k.

14 hours later still not showing in Marcus.

Plan to call Marcus in the morning if still not available, but has anyone else seen this scale of delay?

Signed up to Marcus this morning - all very simple and quick.
Transferred £10 as a test - it arrived in about 5 mins.
Then transferred £10,000. 4 hours later, no sign of it in Marcus...
Will give them a call in the morning if it hasn't arrived by then...

[Cheib]

hyphen said:

Cheib said:

It's really very simple...it's a cheap way for GS to borrow money...i.e. if they go to the wholesale markets it would cost them more to borrow money than it does to give savers these interest rates through "Marcus". Same principal as with the Icelandic Banks back in 2008...they were paying what people thought were amazing rates to borrowers because in their case they had been shut out of the wholesale markets.

They are aggressively pushing loans... Indicates they are aiming to lend more than build up deposits.

Goldmans total assets at 2017 were $979.25 billion and they have a huge black book of deep pocketed private, institutional and sovereign investors. They don't need your £100 a month drip feeding in

I am worried on your behalf, so here are the details of a rape helpline for future use http://www.supportline.org.uk/problems/rape_sexual...

You don't need to be worried for me thanks. I managed a multi billion dollar portfolio of corporate and financial credit risk (loans, bonds and derivatives) for ten years including through the 2007/8 financial crisis so I'm very well aware of GS's business model. They're doing the same thing as countless other companies are....banking disintermediation has been a major theme for the last eight years and will continue to be for some time.