Goldman Sachs Raises Banker Pay And Bonuses By 17 Percent

Home » Business News » Goldman Sachs Raises Banker Pay And Bonuses By 17 Percent
Goldman Sachs To Cut Up To 1,800 Jobs

Goldman Sachs has announced a 17 percent increase in banker pay and bonuses after reporting profits in dealmaking.

The firm spent $4.2 billion on compensation and benefits for its 45,300 employees three months before June.

It’s an almost 20 percent increase from the same period last year. 

This expenditure covers salaries, pensions, and allocations for year-end bonuses.

Since January, Goldman has allocated $8.8 billion for staff compensation and benefits.

This reflects what the bank describes as “improved operating performance.” 

Financial records show Goldman’s profits soared by 150 percent, reaching $3 billion in the second quarter.

This was compared to $1.2 billion the previous year.

The profit increase was largely fueled by a rise in business deals, with investment bankers playing a key role in a wave of mergers and acquisitions. 

Notable deals include ExxonMobil’s $60 billion acquisition of Pioneer Natural Resources in May, for which Goldman acted as a broker alongside Morgan Stanley and Citigroup.

Goldman’s chairman and CEO, David Solomon, said: “We are pleased with our solid second-quarter results and our overall performance in the first half of the year, reflecting strong year-on-year growth in both global banking and markets and asset and wealth management.”

Investment banking is recovering from a two-year decline in dealmaking due to high borrowing rates and economic uncertainty. 

The improved economic outlook and expectations of interest rate cuts by the Bank of England and the US Federal Reserve have increased demand for services from banks like Goldman Sachs.

Need Career Advice? Get employment skills advice at all levels of your career

This trend is expected to result in larger bonuses, particularly for Goldman’s 6,000 UK employees.

“We are pleased with our solid second-quarter results and our overall performance in the first half of the year, reflecting strong year-on-year growth in both global banking and markets and asset and wealth management”

They are no longer restricted by the banker bonus cap that previously limited bonuses to twice an individual’s salary. 

The UK bonus cap was part of post-2007-08 financial crisis reforms aimed at curbing the bonus culture that prioritized short-term profits over long-term stability. 

Despite its recent general election victory, the current Labor party has no plans to reinstate this cap.

Richard Gnodde, CEO of Goldman Sachs International, announced changes to the bank’s pay structure in May.

It allowed hundreds of top earners to receive bonuses up to 25 times their salaries.

Follow us on YouTubeXLinkedIn, and Facebook