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On July 20, 2026, GS Finance Corp., a subsidiary of The Goldman Sachs Group, Inc., issued 300,000 units of Autocallable Leveraged Index Return Notes linked to the MSCI Emerging Markets Index, raising $3 million in total principal. These notes, guaranteed by The Goldman Sachs Group, Inc., mature on July 27, 2028, and include automatic call features based on emerging market index performance. Prospective investors in these structured products should carefully assess the leverage structure, downside risk, and credit exposure to Goldman Sachs entities before investing.
Key Points
- NYSE ticker: GS-PD
- GS Finance Corp. issued 300,000 autocallable notes at $10 principal each on July 20, 2026, settling July 27, 2026
- Notes mature roughly two years post-issuance unless automatically redeemed if the MSCI Emerging Markets Index meets or exceeds its initial level on the call observation date about one year after pricing
- At maturity, investors receive 150% leveraged upside if the index rises, full principal protection if the index declines up to 40%, and 1-to-1 downside exposure if the index drops beyond 40%
Pricing Details and Underwriting Terms
GS Finance Corp. priced the Autocallable Leveraged Index Return Notes at $10.00 per unit on July 20, 2026, generating $3 million in gross proceeds from 300,000 units. The underwriting discount was $0.15 per unit, including a $0.10 sales commission and a $0.05 structuring fee, totaling $45,000 in underwriting compensation. Net proceeds before expenses amounted to $9.85 per unit or $2.955 million overall, per disclosures.
The estimated note value on pricing date was about $9.74 per $10 principal, below the public offering price. Goldman Sachs & Co. LLC stated that its initial bid or ask price, if acting as market maker, would approximate the estimated value plus an additional $0.26 per $10 principal. The firm did not confirm a commitment to maintain a secondary market beyond initial sales.
Automatic Call Feature and Early Redemption Terms
The notes include an automatic call provision enabling early redemption if market conditions are met. The call observation date is approximately July 20, 2027, one year after pricing. If the MSCI Emerging Markets Index equals or exceeds 100% of its initial value on this date, the notes will be automatically called, and investors will receive $11.90 per unit with no further payments. This caps upside at roughly a 19% annualized return if the index remains flat or increases during the first year.
This early call feature allows the issuer to redeem notes when market conditions are favorable, transferring reinvestment risk to investors. If the notes are not called due to index decline, they remain outstanding until maturity on July 27, 2028. The call observation occurs only once, with no rolling or multiple calls during the first year, prioritizing early return distribution if index performance is positive or stable.
Maturity Payoff and Leverage Structure
If uncalled at maturity, payoffs depend on the MSCI Emerging Markets Index's ending value relative to its starting point. The notes offer 150% leveraged upside, so for every 1% index increase beyond the initial value, investors gain 1.5% on principal. This leverage amplifies gains only if the index appreciates from issuance levels.
Principal protection applies if the index declines up to 40%, with investors receiving full $10 principal back if the index ends at or above 60% of the starting value. However, if the index falls more than 40%, investors bear 1-to-1 downside exposure, losing $1 of principal for every 1% drop beyond 40%. This exposes noteholders to potential significant losses if emerging markets suffer steep declines exceeding 40%.
Credit Risk and Guarantee Structure
The notes are senior unsecured obligations of GS Finance Corp., fully and unconditionally guaranteed by The Goldman Sachs Group, Inc. Payments, including principal and call amounts, depend on the creditworthiness of both entities. The notes rank pari passu with other unsecured and unsubordinated debt of GS Finance Corp., except for legally senior obligations, and the guarantee ranks equally among Goldman Sachs’ unsecured debt.
Investors assume full credit risk of issuer and guarantor. The notes are not FDIC insured, not bank guaranteed, and lack collateral backing. Financial distress or default by GS Finance Corp. or Goldman Sachs could result in losses regardless of MSCI Emerging Markets Index performance. This credit risk is independent of the notes’ market-linked features.
Market-Linked Performance and Index Reference
The notes’ returns derive solely from the MSCI Emerging Markets Index (Bloomberg symbol "MXEF Index"). The index starting value is fixed at pricing on July 20, 2026. Payoffs compare index levels on the call observation date (~July 20, 2027) and maturity date (July 27, 2028) against this baseline. The exact starting index value is not disclosed but is available in final pricing documents.
This structured product transfers emerging markets equity risk to investors, while the issuer manages economic exposure through hedging. No periodic interest is paid; returns come from index appreciation (leveraged if uncalled) or capital recovery/loss based on index decline. The 40% downside threshold balances partial principal protection with exposure to severe market downturns.
Secondary Market Liquidity and Trading Limitations
The notes lack exchange listing and have limited secondary market liquidity. Investors cannot readily trade them at transparent prices like exchange-traded securities. Goldman Sachs & Co. LLC may provide bid-ask quotes but is not obligated to maintain a market. Prior to October 20, 2026, any market-making prices include a declining markup starting at $0.26 per $10 principal, reducing linearly to zero by October 19, 2026. After that, prices reflect estimated values from Goldman Sachs’ internal models.
Limited liquidity encourages hold-to-maturity strategies for most investors. Bid-ask spreads beyond initial markup are undisclosed but may cause secondary prices to deviate substantially from purchase prices due to market factors. Early sellers may face difficulty finding buyers and unfavorable pricing. The $100,000 minimum purchase requirement further restricts trading to institutional and high-net-worth investors.
Estimated Value Discount and Pricing Assumptions
The notes were valued at approximately $9.74 per $10 principal on pricing date, a $0.26 discount to the offering price. This reflects credit spreads, interest rates, volatility assumptions, time to maturity, and issuance costs. Pricing models used by Goldman Sachs & Co. LLC incorporated issuer credit spreads prevailing at pricing.
The $0.26 difference includes the $0.15 underwriting discount (sales and structuring fees) plus about $0.11 representing embedded option costs from early call rights and leverage/downside features. The estimated value is an internal reference and does not guarantee secondary market prices or future returns. Specific volatility, interest rate, and credit spread inputs were not disclosed.
Market-Making and Secondary Pricing Policy
Goldman Sachs & Co. LLC detailed its secondary pricing approach if it acts as market maker. Before October 20, 2026, bid/ask prices equal estimated value plus a declining markup from $0.26 to zero over three months. After October 20, 2026, prices depend solely on updated estimated values reflecting market conditions such as interest rates, volatility, and credit spreads. The firm retains discretion over market-making activity and spreads, creating uncertainty around liquidity and exit costs before maturity.
Regulatory Status and Risk Warnings
The prospectus supplement and term sheet clarify that the Securities and Exchange Commission or other regulators have neither approved nor disapproved the notes or verified the prospectus accuracy. The notes are not bank deposits, are not FDIC insured, and are not guaranteed by any bank, distinguishing them from traditional bank products and excluding depositor protections.
Investors are directed to detailed risk disclosures starting on page TS-5 of the term sheet and page PS-7 of the product supplement, plus indexed securities risks in the main prospectus. These materials cover emerging market exposure, leverage, credit risk, liquidity, and valuation risks. Thorough review of all risk factors is essential before investing, as structured notes carry complexities absent in conventional debt or index funds.
Registration and Offering Details
The notes are issued under SEC Registration Statement No. 333-284538, utilizing a base prospectus dated February 14, 2025, a prospectus supplement of the same date, and Product Supplement No. EQUITY MLI-4 dated January 20, 2026. This layered documentation provides comprehensive product, risk, and issuer credit information. GS Finance Corp. and Goldman Sachs & Co. LLC may use these materials for initial sales and ongoing market-making.
The initial offering size was $3 million as of July 20, 2026. The company reserves the right to increase issuance by selling additional notes later at different prices and underwriting terms, potentially expanding beyond the initial amount if demand warrants. Investors should watch for announcements of any subsequent tranches.
