Goldman Sachs paid chief executive David Solomon $31 million (€28.8 million) for 2023, up 24 per cent annually, despite the Wall Street investment bank reporting its lowest profits in four years.
Last year was the most challenging of Mr Solomon’s five-year tenure leading Goldman. He faced a string of critical news articles about his leadership style, while the bank also cut thousands of jobs and suffered from a slowdown in investment banking activity.
But the board rewarded Mr Solomon for paring back a loss-making push into retail banking, re-emphasising Goldman’s strategy around its core investment banking and trading business and expanding in asset and wealth management.
The $31 million in pay for Solomon is made up of $2 million in base salary and a $29 million bonus, the bulk of which is paid in performance-based stock, according to a securities filing on Friday.
Romantasy, QuitTok and other words from a dystopia-coded year
Have Ireland’s data centre builders shot themselves in the foot through their own greed?
The old order of globalisation may be collapsing – and bringing Germany with it
Wonderwallets: the cost of everything in 2024, from Oasis tickets to Leinster House bike shelter
His remuneration was up from $25 million in 2022, making 2023 his second-most lucrative year running Goldman, behind the $35 million he earned in 2021.
[ Goldman chief David Solomon calls time on high-profile DJ gigsOpens in new window ]
[ UK economy suffering ‘long-term’ cost of Brexit, Goldman Sachs saysOpens in new window ]
Mr Solomon’s pay rose more than overall expenses on remuneration at Goldman, which were up only 2 per cent last year. The bank’s headcount fell by 3,200 employees in 2023 to just over 45,000 and average pay expense per employee was up almost 10 per cent.
Rivals JPMorgan Chase and Morgan Stanley also raised their chief executives’ pay for 2023. JPMorgan’s Jamie Dimon, whose bank reported record profits for 2023, had his pay rise about 4 per cent to $36 million, while Morgan Stanley’s James Gorman, who stepped down as chief executive at the start of 2024, was paid $37 million, up 17.5 per cent. Bank of America cut the pay of its top executive, Brian Moynihan, by 3 per cent, or $1 million, to $29 million.
Goldman took several one-off hits to profits last year – such as scaling back its once-ballyhooed consumer business – in what analysts characterised as a “kitchen sink” approach to clear the decks for 2024.
“While these strategic actions negatively impacted short-term performance, the compensation committee believes that the actions of senior management were critical to reorienting the firm with a much stronger platform for 2024 and beyond,” Goldman wrote in the filing announcing Mr Solomon’s pay.
Net income at the bank fell 24 per cent in 2023 to $8.5 billion, the lowest since 2019. Goldman also reported a return on equity, a key gauge of profitability, of 7.5 per cent, well short of the bank’s target of 14-16 per cent. – Copyright The Financial Times Limited 2024
- Sign up for Business push alerts and have the best news, analysis and comment delivered directly to your phone
- Find The Irish Times on WhatsApp and stay up to date
- Our Inside Business podcast is published weekly – Find the latest episode here
