Goldman Sachs begins large round of layoffs

Goldman Sachs is embarking this week on one of its largest rounds of layoffs since the financial crisis.
The bank began to lay off employees on Tuesday as part of a plan that will see the firm shed up to 3,200 jobs, or roughly 6% of its workforce, said two people familiar with the changes who were not authorized to discuss them publicly. It plans to notify the bulk of the affected employees Wednesday, the people said.
The layoffs across the bank underscore the economic challenges facing the Wall Street giant, which is also trying to regain its footing after a costly push into consumer banking.
Goldman, like other major investment banks, had seen its fees soar during the pandemic, bolstered by a huge upswing in deal-making, trading and related activities. But it has struggled to keep up the momentum as deals have slowed and markets have fallen. Investors have also sharply questioned the growth prospects of the consumer-lending business that the bank rolled out in 2016.
The slowdown also poses a test for the bank’s CEO, David Solomon, who was appointed to the role in 2018. Solomon had been a champion of the bank’s consumer lending strategy.
Shares of Goldman Sachs have fallen about 10% over the past year, giving it a market value of $120 billion. It employed 49,100 people at the end of September.
In October, Goldman Sachs announced a major restructuring that folded Marcus, its consumer-banking business, into a new division combined with its asset and wealth management businesses.
The Goldman Sachs cuts come before the bank doles out its annual bonuses for 2022, which make up a major portion of investment bankers’ salaries. Base salaries for senior bankers can range from hundreds of thousands to millions of dollars, while their bonuses can be double or triple their base.
For those who keep their jobs, this year’s bonus season is expected to be grim. Across Wall Street’s largest banks — Goldman, JPMorgan Chase, Citigroup, Bank of America, Morgan Stanley and Barclays — bonuses are expected to drop by as much as 30% to 50% from last year.
The banks are set to offer more insight into their numbers for the year starting Friday, when JPMorgan Chase, Wells Fargo and Bank of America report fourth-quarter results. Analysts expect the numbers to be disappointing. Goldman is set to report its earnings next Tuesday.

#Goldman #Sachs #begins #large #layoffs

Related Articles

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top button