Goldman to hand out big bonuses to top performers despite bank’s falling profits: report

Goldman Sachs plans to hand out big bonuses to its star bankers, report says report – despite falling profits at the bank and reports that this year will be a disaster for year-end payments across Wall Street.

The financial giant led by Chief Executive David Solomon is looking to keep its top-performing employees happy this year after many were disappointed with last year’s meager bonuses, Reuters reported on Tuesday.

Solomon and other top executives have been quietly meeting with Goldman partners to promise top bankers, traders and asset managers that they will receive good salaries this year, according to the report, even though the bank has seen its profits fall by 34%. % in the first three quarters of the year. 2023.

A source close to Goldman said the bank is “confident about future prospects and wants to make sure it has its team in place.”

Goldman, which is facing losses in its consumer business and facing a slowdown in dealmaking, has suffered a series of recent exits that may have spooked management enough to loosen its purse strings, insiders said.

While others on Wall Street prepare to receive smaller bonuses, Goldman’s top performers will continue to receive generous pay.

In recent years, departures have included Julian Salisbury, Luke Sarsfield, Jeff Currie, Omer Ismail, Katie Koch, Harvey Schwartz, Gregg Lemkau, Eric Lane, Stephen Scherr and Dina Powell.

A spokesperson for the bank said in a statement: “Our compensation philosophy has not changed, we are always focused on investing in our people, especially our top performers. “We are not going to comment on premature speculation around the competition cycle.”

Elsewhere on Wall Street, bankers face bonuses that could shrink by as much as 25% as deals dry up amid rising interest rates, according to a new survey.

Investment bankers will be the toughest, as year-end bonuses will fall by 15% to 25%, according to Johnson Associates, the compensation consulting firm behind the report.

Goldman headquarters at 200 West St.
Some at Goldman can expect bigger bonuses this year even as the firm’s revenue falls.
William Farrington

Meanwhile, retail and commercial banking workers could see increases of up to 10%.

“Most Wall Street professionals will have to wait another year for their year-end bonuses to recover,” said Alan Johnson, the firm’s CEO. “For most… it will be another disappointing year.”

While investment banking advisory remains stagnant, investment banking underwriters, who have been raising debt financing, can expect a small salary increase of 5% to 10%, according to the study.

Meanwhile, retail deposits have increased at major commercial banks and those higher margins will boost wages. But for regional bankers, who do similar work at smaller institutions, compensation will decline by 10% to 20% amid massive cash outflows, according to the study.

Hedge fund bonuses will be tied to the fund’s performance and could fall 5% or rise 5% depending on the fund’s year. Stock trading bonuses will fall by 5% to 10%, while fixed income trading bonuses will remain relatively stable, according to the survey.

Wealth management, which has attracted new clients this year, could see a 5% increase in bonuses. Asset management, which saw its profits fall this year, will see a marginal drop in bonuses of between 5% and 10%.

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