Goldman Sachs has incurred significant losses from the Apple Card, totaling at least $1 billion, amidst a broader consumer product loss of $6 billion. The bank is now seeking to exit its partnership with Apple, with reports indicating that JPMorgan Chase is the leading candidate to take over.
Challenges persist due to the high percentage of subprime customers associated with Apple Card, which has a subprime rate of 34%. This figure contrasts sharply with Chase's rate of approximately 15% and Capital One's 31%. Additionally, the Apple Card's delinquency rate stands at 4%, surpassing the industry average of 3.05%.
While American Express, Capital One, and Synchrony have been mentioned as potential suitors, they currently appear less likely to pursue the partnership. Discussions around the takeover have been complicated by concerns over the card's customer base, which includes many with credit scores below 660.
As of now, the future of the Apple Card remains uncertain, with no formal agreement in place despite JPMorgan Chase being identified as the "preferred choice" for the acquisition. The total balances on the Apple Card exceed $20 billion, indicating its substantial presence in the market.