Goldman Sachs is reportedly preparing for another round of layoffs as the deal-making environment on Wall Street remains stagnant.
Sources said the layoffs are expected to impact various employees, including managing directors and senior executives, and will likely affect fewer than 250 jobs.
While the exact timing of the cuts is unknown, they could occur within the next few weeks.
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This would mark the third wave of job cuts at the banking giant in less than a year.
In September, it trimmed a few hundred positions as part of regular staffing adjustments, and in January, approximately 3,200 employees, around six percent of the workforce, were let go.
As of the first quarter, the investment bank had about 45,000 employees.
The decision to implement further layoffs primarily stems from the prolonged slump in deal-making activities.
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Senior executives at Goldman Sachs and other investment banks expected a rebound in the sector during the first half of the year, but that recovery failed to materialize.
Factors such as the regional banking crisis, the Federal Reserve’s efforts to control inflation through interest rate hikes, and concerns about a potential recession have contributed to the slowdown.
Goldman Sachs faced challenges in its investment banking and trading divisions during the last quarter, with a decline in revenue.
Other major banks are also implementing layoffs.
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Morgan Stanley is reportedly cutting around 3,000 positions this quarter.
By the end of June, Bank of America plans to eliminate approximately 4,000 jobs, equivalent to about two percent of its workforce.
In response to the slowdown in deal-making, Goldman Sachs has been reducing expenses across various divisions this year, including travel and client events.
The bank is also scaling back on attending F1 events in the US compared to the previous year when it became an official sponsor of the McLaren Formula 1 team.
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During its investor day in February, President and COO John Waldron expressed the bank’s commitment to unlocking $1 billion in savings from compensation and non-compensation expenses.Â
The funds would then be reinvested into its core businesses.
CFO Denis Coleman also mentioned a shift in hiring strategy, focusing on critical positions and strategic hires rather than replacing every departing employee.
