By Matt Scuffham

NEW YORK (Reuters) – Goldman Sachs Group Inc management is considering whether to scale back financial targets set earlier this year, as the coronavirus pandemic has hindered the bank’s business model revamp, analysts and sources inside the bank told Reuters.

Goldman unveiled plans to boost returns on equity and cut costs during its first-ever investor day in January. To reach its goals, Goldman would squeeze more revenue from existing businesses like wealth management as well as relatively new ones like consumer lending, while launching additional corporate services like cash management.

Since then, the pandemic has slammed into the economy, crippling loan demand and causing widespread unemployment. It has also prevented Goldman bankers from drumming up business with new customers the way they could before coronavirus lockdowns.

Although Goldman’s trading revenue has soared thanks to market volatility, other initiatives have stalled.

“Unless there’s a silver bullet vaccine cure, it looks like Goldman will not hit its targets,” said Viola Risk Advisors bank analyst David Hendler. “It’s behind on wealth management and it’s behind on consumer.”

A spokesman for Goldman referred Reuters to executives’ prior statements but declined to comment further.

Goldman Sachs executives have stood by their targets, stressing that the path to achieving them in the coming years would not be “linear.” They are not expected to move the goalposts on Wednesday when the bank reports third-quarter results.

Instead, the bank may change targets in January, a year after they were set, said the sources, who were not authorized to speak publicly.

As it stands, Goldman pledged to produce a return on tangible common shareholders’ equity (ROTE) of more than 14% by 2023, compared with 10.6% in 2019.

The bank also outlined plans to cut expenses by $1.3 billion over that time frame, producing an efficiency ratio

* Bank lending rises 6.4% in September vs 6.7% in August

* Major banks’ lending slows as big firms pay back loans

* Smaller borrowers continue to rely heavily on lending

(Adds details, quotes from BOJ briefing)

By Chris Gallagher and Leika Kihara

TOKYO, Oct 12 – Japanese bank lending rose at a slower
annual pace in September than the previous month as corporate
funding strains caused by the pandemic eased mainly among big
borrowers, central bank data showed on Monday.

But lending by regional banks remained high as smaller firms
continued to borrow heavily to meet immediate funding needs, the
data showed, underscoring the lingering economic pain brought by
the health crisis.

“Big companies that had borrowed huge amounts of funds as a
precaution around spring are now paying back some of the loans
due to easing uncertainty over the pandemic,” a BOJ official
told a briefing.

“But that’s not to say conditions have improved. There are
gaps among industries on how much their profits have recovered.”

Total bank lending rose 6.4% in September from the same
month a year earlier, slower than a 6.7% gain in August, to a
record 573.7 trillion yen ($5.43 trillion), Bank of Japan data

The pace of lending by major banks slowed to 7.3% in
September from 8.0% in August.

Lending by regional banks rose 5.3%, roughly unchanged from
the previous month’s 5.4% increase. Those by “shinkin” credit
associations, which lend mostly to small firms in regional areas
of Japan, rose 7.8%, the fastest pace on record, the data

Bank deposits rose 9.0% in September from a year earlier,
the biggest increase on record, as households held back on
spending and instead saved government pay-outs aimed at
cushioning the blow from the pandemic, the official said.

($1 = 105.6300 yen)


The average price of fully-comprehensive car insurance now stands at £473. Photo: Oliur/Unsplash
The average price of fully-comprehensive car insurance now stands at £473. Photo: Oliur/Unsplash

Car insurance premiums fell throughout 2020 – thought to be a result of the national COVID-19 lockdown, which at it’s height caused road traffic to plummet by 73% but the rate of decline may be slowing.

Car insurance prices dropped by 3.6% in the first quarter of the year and then by a massive 4.7% in the second quarter, when they hit their lowest price in five years – £462 ($603) for fully-comprehensive cover.

However, a modest price drop of 0.3% in the third quarter suggests the fall may be starting to taper off, MoneySuperMarket data shows.

The average price of fully-comprehensive car insurance now stands at £473, the data shows.

What’s more, despite prices falling in 2020, annual comparisons show a slight increase, with fully-comprehensive cover costing about £473 during Q3 2019.

The study found drivers in east London pay most for premiums, at £950 – more than double the UK average.

READ MORE: UK drivers ‘unaware’ of government’s electric car grant

Meanwhile, London as a whole paid about £679 during the third quarter of the year.

On the other hand, drivers on the Isle of Lewis have the cheapest premiums in the country, at just £293.

Looking at age, premiums have fallen the most year-on-year for those aged 17 to 19, with fully comprehensive cover now costing these drivers about £823 – down 21% from £1,037 in 2019.

However, premiums for this age group did see a quarterly price increase of £46 from £777 to £823.

Drivers aged between 40 and 49 have seen the biggest price rise, with premiums up 5% year-on-year to £422, from £402.

The 20 to 24 demographic pays the most on average, with third-quarter premiums costing £917.


By Sinead Cruise

LONDON (Reuters) – Britain’s NatWest Group <NWG.L> has kicked off a campaign encouraging customers to dump the discredited Libor lending rate, as the coronavirus pandemic slows the pace at which borrowers are shifting to alternatives.

The lender is writing to 3,500 companies to explain how delays in switching could increase the volatility of their borrowing costs and how to choose the most suitable new benchmark before Libor disappears at the end of 2021.

The campaign coincides with the banking sector’s third quarter deadline on offering alternative risk-free rates on new loans, and comes six months before new lending referencing Libor is banned.

Authorities decided to phase out Libor after finding it had been rigged for profit, but Reuters reported in April that some businesses and banks were struggling to make the switch in the midst of a global pandemic. [nL5N2BW06G].

Global regulators are sticking to the current end-2021 deadline for scrapping Libor, which is embedded in up to $340 trillion worth of financial contracts worldwide.

But some borrowers remain slow to adopt rates such as Sonia, the sterling overnight index average, as they only show the interest due on a loan just before a payment is due.

Some companies are still structuring Libor loans that include clauses to switch to another rate at the end of 2021, while others are choosing base rate products, said Jamie Thrower, Libor transition lead for NatWest customers with more than 6.5 million pounds ($8.4 million) in revenues.

“We’re starting to see a very small handful of blue chips at the top of the pyramid going straight into a Sonia facility but it’s taken quite some time to get there,” Thrower said.

“The base of the pyramid comprises the majority of corporates for whom Libor transition has not grabbed their attention in

By Lucia Mutikani

WASHINGTON (Reuters) – U.S. employment growth slowed more than expected in September and over 300,000 Americans lost their jobs permanently, dealing a potential blow to President Donald Trump ahead of the fiercely contested Nov. 3 presidential election.

The Labor Department’s closely watched employment report on Friday underscored an urgent need for additional fiscal stimulus to aid the economy’s recovery from a recession triggered by the COVID-19 pandemic. The slowdown in hiring compounds problems for Trump, who announced overnight that he had tested positive for coronavirus.

Just over half of the 22.2 million jobs lost during the pandemic have been recouped. Former Vice President Joe Biden, the Democratic Party nominee, blames the economic turmoil on the White House’s handling of the pandemic, which has killed more than 200,000 people and infected over 7 million in the nation.

“The jobs report adds to Trump’s woes,” said James Knightley, chief international economist at ING in New York. “Betting odds signal a diminished chance he will win re-election and a much higher probability of a Democrat clean sweep.”

Nonfarm payrolls increased by 661,000 jobs last month, the smallest gain since the jobs recovery started in May, after advancing 1.489 million in August. Every sector added jobs with the exception of government, which shed 216,000 positions because of the departure of temporary workers hired for the Census and layoffs at state and local government education departments as many school districts shift to online learning.

Employment in the leisure and hospitality sector increased by 318,000, accounting for nearly half of the gain in nonfarm employment. Payrolls are 10.7 million below their pre-pandemic level. Economists polled by Reuters had forecast 850,000 jobs were created in September. Employment growth peaked in June when payrolls jumped by a record 4.781 million jobs.

(Graphic: Nonfarm payrolls –