In macro news, the US Economy added 225,000 jobs in January, beating expectations of 158,000 jobs, and brought the unemployment rate to 3.6%. Wages increased by 3.1% from a year earlier.

At the same time, the inverted yield curve returned to the scene after quietly exiting this past October.  

Source: PeerIQ, The Daily Shot

Goldman Sachs Hosted its First Investor Day
Last week, Goldman Sachs hosted Investor Day and offered a greater perspective into Marcus.
Exec. Eric Lane stated, “We aspire to be the leading digital consumer bank…We’re starting with loans, we added savings and cards, and we’re working to build out the balance of the digital products suite, including wealth and checking.”
Marcus seeks to compete against digital challenger banks as well as leading online brokerage/banking firms such as Charles Schwab. 
Goldman aims to double its consumer deposits to $125 billion over the next five years. The Investor Day presentation shared that Marcus had achieved $60 billion in deposits, 5 million customers, and $7 billion in loan/card balances at the end of 2019. 
The goal is to generate between $700 to $900 million in pretax income; however, today Marcus’ results show a negative contribution margin and will for several years.
Below is a choice chart:

Source: Goldman Sachs, PeerIQ

We recommend Matt Levine at Bloomberg’s tongue-in-cheek editorial called, “Goldman Has Some Boring Plans.” Check it out. 

Mastercard Prefers to Partner, Visa Prefers to Acquire?
Mastercard is taking a different approach to Visa’s acquisitive approach by aggressively partnering with FinTechs.
  • Mastercard has launched card programs for FinTechs like Brex Inc., Revolut Technologies Inc., and TransferWise Inc., and has unveiled programs designed to make it easier for startups to join MasterCard’s network. 
  • These FinTech partnerships have helped boost customer spending on the firm’s cards to $1.28 trillion in the quarter, up 11% from a year earlier and in line with analysts’ estimates.
  • “The solution that Mastercard brings is more holistic than just saying, ‘we’ll switch the transaction for you,’” CFO, Sachin Mehra said in a telephone interview. “We say, ‘All right, FinTech ABC, what are your objectives? What are you trying to achieve? You’re trying to go cross border or you’re trying to target travelers? Here, let us help you with data analytics and fraud tools.’”

The efforts are paying off. SoFi announced it is dumping Visa and made Mastercard its exclusive partner for credit and debit cards.
The switch to Mastercard, SoFi will also add new benefits to the debit card, including cash-back rewards, free cell phone insurance, and discounted airport concierge services. SoFi also announced plans to launch its first credit card.
PeerIQ New Hire!
Laura Mun is currently a full-stack engineer on the front-end and platform team. Previously, Laura worked as a developer for various AR/VR/XR projects, including the Celestial Bodies exhibit at the Museum of Sex in New York City. In her spare time, Laura enjoys flexing her creativity in the culinary arts, building Arduino projects, and gaining inspiration from hikes and museums.

PeerIQ at SFIG 2020:

We are excited about the new capabilities PeerIQ has rolled out for owners and investors in whole loans. Schedule time with us at SFIG Vegas and we look forward to sharing more.


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