Apple Card taken over by JPMorgan. Why Goldman has exited the credit play.
The deal ends a failed experiment in consumer lending for Goldman Sachs, which launched a card with Apple in 2019.
JPMorgan Chase is taking over the Apple credit-card program from Goldman Sachs—and the iPhone maker will be hoping a new partner brings about a change in fortunes for the co-branded program.
JPMorgan’s retail and commercial banking business Chase will become the new issuer of the Apple Card, the two companies said late Wednesday, with Mastercard set to remain the card’s payment network. The deal is expected to close in 24 months, subject to regulatory approvals.
The agreement will bring more than $20 billion of card balances to JPMorgan, which said it expects to recognize a $2.2 billion provision for credit losses in its fourth-quarter earnings report due on Jan. 13.
The deal ends a failed experiment in consumer lending for Goldman, which entered the credit card business in 2019 via the Apple partnership.
The investment bank is dumping the outstanding card balances at a discount of more than $1 billion, according to a report from The Wall Street Journal that cited people familiar with the matter. Goldman didn’t respond to a Barron’s request for comment on the size of the discount, but flagged a press release that forecast the transaction will boost its fourth-quarter earnings by 46 cents a share.
The relationship between Apple and Goldman rarely ran smoothly. Goldman executives were irked by Apple ads that said the card wasn’t from a bank, people briefed with the matter told The Journal in 2023. Apple’s push for nearly all credit-card applicants to be approved drove up Goldman’s loan losses, the people said.
Apple has explored other businesses in recent years in a bid to limit its exposure to slowing iPhone sales, but the ventures have rarely been a success. The company scrapped plans for an electric car in February 2024, and has fallen behind its Big Tech peers in artificial intelligence.
Apple stock dropped 1.1% ahead of Thursday’s opening bell, extending a selloff from the previous session during which the iPhone maker fell behind Alphabet as the second-largest U.S. company by total market capitalization. JPMorgan shares slipped 0.2% and Goldman Sachs was down 0.4% in the premarket.
Write to George Glover at george.glover@dowjones.com
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