Goldman Sachs Unveils Reporting Changes Ahead of Q4 Earnings and First-Ever Investor Conference

Goldman CEO David Solomon hinted at plans to overhaul the venerable investment bank Tuesday with a new corporate reporting structure that comes just weeks ahead of its first-even investor day conference later this month.
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Goldman Sachs (GS) - Get Report shares edged higher Tuesday after the investment bank unveiled a shift in the way it publishes quarterly earnings ahead of its first-ever investor day conference later this month.

Goldman said its new earnings structure will focus on four business units: global markets (formerly institutional client services), investment banking, asset management and consumer and wealth management. The revised structure, which comprise the first major changes for the bank under CEO David Solomon, will apply to its fourth quarter earnings report, which is scheduled for January 15.

"The firm believes this new segment presentation, which is part of its ongoing commitment to organizing the firm in a client-centric way, will not only better reflect how the firm is now managed, but also help drive greater accountability for executing its forward strategy," Goldman said in a statement.

Goldman shares were marked 0.5% higher at the start of trading Tuesday to change hands at $235.00 each. Goldman shares have gained around 13.7% over the past six months, nearly double the 7% gain for the Dow Jones Industrial Average and the 7.3% gain for the S&P 500 Banks Select Industry Index.

Solomon had promised to reveal a "front-to-back" review of Goldman's business and operations to investors last year, but postponed the findings until January 29. 

While details of the overhaul remain secret, Goldman has said it plans to improve shareholder returns by cutting expenses, scrapping legacy technology and simplifying its organization structure. 

Goldman is also likely to detail plans to expand its consumer banking business, which suffered a blow late last year amid a series of questions over the fairness of the algorithm linked to its Apple Inc. (AAPL) - Get Report Titanium credit card and a potential investigation by financial services authorities in the state of New York.

Apple, which launched Titanium with Goldman last year, has been accused of allowing the card's algorithm to set credit limits for some applicants based on gender following a torrent of comments on Twitter over the weekend that included the voice of co-founder Steve Wozniak. 

The allegations prompted a response from Linda Lacewell, the Superintendent of New York State Department of Financial Services, who noted the so-called 'black box' problem of opaque nature of credit scoring and the lack of consumer visibility in the process of correcting errors.

The Apple Card controversy began late Thursday after a series of Tweets from David Heinemeier Hansson, the entrepreneur behind the Ruby on Rails web application framework, who claimed he was given a credit limit that was ten times that of his wife's, despite the pair filing joint tax returns.

His complaint was followed by a supporting Tweet from Apple co-founder Wozniak, who blamed both the bank and Apple for the alleged unfairness.