Unlock Editor’s Digest for free
Roula Khalaf, editor-in-chief of the FT, selects her favorite stories in this weekly newsletter.
Goldman Sachs’ top executives are set to receive more than $500 million in special bonuses as part of a five-year incentive plan, one of the largest such payouts in the Wall Street bank’s history.
The lender is preparing to award shares to a group of its most senior executives that would exceed $500 million at Goldman’s current share price, according to a person familiar with the matter.
The payment is part of a long-term incentive program the bank unveiled in 2021, with the final value of the bonus pool determined by the bank’s stock performance relative to its peers as of the end of October, meaning it could still change, another person said.
The bumper plan, first reported by Bloomberg, comes after Goldman’s share price outperformed most of its Wall Street rivals over the past five years.
The special incentive package was agreed at a time when Wall Street banks were benefiting from record deals and a boom in “blank check” companies as the sector rebounded from the Covid pandemic.
Goldman Chief Executive David Solomon is expected to receive the largest share of the bonus sum, about $100 million in stock.
John Waldron, Goldman’s number two who is widely seen as Salomon’s heir apparent, is also among the plan’s beneficiaries, along with other members of Goldman’s management committee from 2021 who are still at the bank.
Solomon’s performance-based stock was worth about $30 million when Goldman announced the plan in 2021, while Waldron’s was worth about $20 million.
Solomon and Waldron, Goldman’s president and chief operating officer, have led the investment bank since 2018. Both men also received five-year retention bonuses, worth $80 million each, beginning in 2025.
Goldman paid Solomon $47 million last year, an increase of more than a fifth from the previous year and his highest compensation since he took the helm of the Wall Street bank.
The first half of his tenure was marked by a loss-making expansion in retail banking, which was at odds with the investment banking pedigree on Wall Street and led to strong criticism of Salomon’s leadership.
After billions of dollars in losses, Goldman largely withdrew from the consumer surge and has since doubled down on its investment banking, trading and money management businesses. The bank’s shares are up about 180 percent over the past three years.
Goldman said: “The Board of Directors created these awards to achieve three primary goals: aligning compensation with rigorous performance thresholds, ensuring continuity of leadership, and improving the retention of our top talent in an increasingly competitive market.
Gn bussni
