Goldman Sachs Group (GS) is said to be considering cutting total bonuses for its 3,000 investment bankers by at least 40% this year, but has yet to make a decision on the final size of the bonus pool. Bonuses for Goldman’s roughly 400 partners could be cut in half.
Traders at Goldman Sachs were surprised by reports that their year-end bonuses could be cut by the firm’s leadership due to cost pressures. Executives in the company’s global markets division were warned this week that their compensation and bonus pools would be cut by 20%. This runs counter to industry-wide forecasts and the sector’s own stellar performance. Goldman’s annual trading revenue is on track to top $25 billion, which analysts estimate will exceed last year’s figure by 15%.
Austerity is the new mood in investment banks, with many senior figures uncertain about the firm’s earnings outlook for 2023. Investors are being wary of incentives and showing less patience for continued spending.
Goldman Sachs is in an awkward time and position this year. Chief executive David Solomon and president John Waldron said efforts were being made to protect the company’s profitability. The company’s move into consumer banking has been costlier than expected, exacerbating the impact of a global slowdown in other areas of its business, such as dealmaking.
Editor in charge: Li Tong
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Event Tracking
- 2022-12-15Goldman Sachs considers cutting investment banker bonuses by at least 40%
- 2022-09-13 Goldman Sachs starts “eliminating the last place”, and plans to lay off hundreds of people starting this month
- 2022-08-05 Apple Card partner Goldman Sachs faces credit card business regulatory investigation
- 2020-10-02 News that Goldman Sachs will buy GM’s credit card business for $2.5 billion
- 2020-07-23Goldman Sachs: Investors should “avoid” Apple stock, new iPhone release may be delayed
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