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Goldman Sachs Chairman and CEO Lloyd Blankfein will take home nearly $68 million in restricted stock, options and cash, making it the largest bonus ever given to a Wall Street CEO.
Blankfein was awarded $26.8 million in cash and $41.1 million in restricted stock and stock options, according to a company filing with the Securities and Exchange Commission issued Friday.
Lloyd Blankfein, Goldman Sachs Group Inc's CEO has been given a $67.9 million bonus for 2007, the firm said on Friday. This news comes in a period throughout which other top rival CEO’s lost their jobs or didn’t get any bonuses after losing billions of dollars on sub-prime mortgages.Goldman, one of the world's largest global investment banks, managed to steer clear of a meltdown and capped its fiscal year with outstanding financial results. Consequently, Blankfein’s reward for keeping the form on its right track included $41.1 million of restricted shares and options, as well as $26.8 million in cash.The CEO wasn’t the only member of Goldman’s management to be rewarded for the job well done. Co-Presidents Gary Cohn and Jon Winkelried will also receive a restricted shares and options valued at about $40.5 million each, up from $25.7 million last year.Cash payments weren't disclosed for anyone other than Blankfein, who reaped a record-setting $53.4 million last year.Goldman Sachs Group Inc. exceeded Wall Street profit records for the fourth-consecutive year and this in a period throughout which even banks and securities firms like Citigroup Inc. and Merrill Lynch & Co. had no choice but to take at least $96 billion of write-downs.Goldman also increased its employee’s salaries and set aside $20.2 billion for the benefits and bonuses which increased 23 percent compared to last year.“There are successful people and then there's extraordinary success, and they're trying to show as a firm that they're really extraordinary. They're rewarding him for leading such a fabulously successful ship,'' said Jeanne Branthover, managing director of Boyden World Corp., for Bloomberg.Blankfein, 53, earned a total of $53.4 million in 2006, thus becoming one of the highest paid executives on Wall Street. His bonus reflected the performance of Goldman Sachs, which reported record net earnings of $9.5 billion.
With this year's bonus, Blankfein shatters the record he set a year ago, when he was awarded $54 million.
News reports had originally projected that Blankfein will take home as much as $70 million, after helping to lead the company through this summer's market meltdown and the ongoing credit crisis.
Unlike some of its rivals, which have witnessed billions of dollars evaporate from their balance sheets, Goldman Sachs has proved unshakable. Just this week, the company reported better-than-expected fourth-quarter earnings, while peers like Morgan Stanley and Bear Stearns recorded steep losses.
As it stands right now, Blankfein will be among the few Wall Street CEOs to collect a bonus this year. After this week's dismal results, Morgan Stanley (MS, Fortune 500) Chairman and CEO John Mack and Bear Stearns (BSC, Fortune 500) chief James Cayne both announced they would forsake their 2007 bonuses.
While bonuses are common throughout corporate America, they are a far bigger part of overall compensation for all levels of employee pay on Wall Street than they are at a typical corporation.
Tom McMullen of the Hay Group, a human resources and management consultant, estimates that cash bonuses typically equal between 40 and 100 percent of base salary for top executives on Wall Street, while senior managers receive between 15 to 30 percent of base pay as bonus payments. Even entry-level employees might see 10 to 20 percent of their base pay in the form of a bonus.
This year was expected to be a difficult one for finance pros given the recent market turmoil and the ongoing credit crisis. Overall, financial firms were expected to cut bonuses up to 10 percent from a year ago, according to industry projections.
A year ago, bonuses on Wall Street reached a record $23.9 billion, averaging more than $136,000 per employee, according to the New York State Comptroller's office.
Facing the biggest bonus squeeze were those individuals working in mortgage-related areas, with their bonuses declining by as much as 50 percent from a year ago, according to a report published last month by the compensation research firm Options Group.
Even though dealmaking has slowed considerably on Wall Street, investment bankers are still expected to enjoy a bump in their annual bonus from a year ago given the frenetic pace of merger-and-acquisition activity in the first half of 2007.
With so many banks underperforming, many financial firms were widely expected this bonus season to shift from cash to stock in an effort to compensate employees while retaining talent. Some firms have already said they would cap their cash compensation, including UBS, which announced a limit of $750,000 for its workers.
Goldman Sachs (GS, Fortune 500) stock finished more than 3 percent higher in Friday trade
Blankfein was awarded $26.8 million in cash and $41.1 million in restricted stock and stock options, according to a company filing with the Securities and Exchange Commission issued Friday.
Lloyd Blankfein, Goldman Sachs Group Inc's CEO has been given a $67.9 million bonus for 2007, the firm said on Friday. This news comes in a period throughout which other top rival CEO’s lost their jobs or didn’t get any bonuses after losing billions of dollars on sub-prime mortgages.Goldman, one of the world's largest global investment banks, managed to steer clear of a meltdown and capped its fiscal year with outstanding financial results. Consequently, Blankfein’s reward for keeping the form on its right track included $41.1 million of restricted shares and options, as well as $26.8 million in cash.The CEO wasn’t the only member of Goldman’s management to be rewarded for the job well done. Co-Presidents Gary Cohn and Jon Winkelried will also receive a restricted shares and options valued at about $40.5 million each, up from $25.7 million last year.Cash payments weren't disclosed for anyone other than Blankfein, who reaped a record-setting $53.4 million last year.Goldman Sachs Group Inc. exceeded Wall Street profit records for the fourth-consecutive year and this in a period throughout which even banks and securities firms like Citigroup Inc. and Merrill Lynch & Co. had no choice but to take at least $96 billion of write-downs.Goldman also increased its employee’s salaries and set aside $20.2 billion for the benefits and bonuses which increased 23 percent compared to last year.“There are successful people and then there's extraordinary success, and they're trying to show as a firm that they're really extraordinary. They're rewarding him for leading such a fabulously successful ship,'' said Jeanne Branthover, managing director of Boyden World Corp., for Bloomberg.Blankfein, 53, earned a total of $53.4 million in 2006, thus becoming one of the highest paid executives on Wall Street. His bonus reflected the performance of Goldman Sachs, which reported record net earnings of $9.5 billion.
With this year's bonus, Blankfein shatters the record he set a year ago, when he was awarded $54 million.
News reports had originally projected that Blankfein will take home as much as $70 million, after helping to lead the company through this summer's market meltdown and the ongoing credit crisis.
Unlike some of its rivals, which have witnessed billions of dollars evaporate from their balance sheets, Goldman Sachs has proved unshakable. Just this week, the company reported better-than-expected fourth-quarter earnings, while peers like Morgan Stanley and Bear Stearns recorded steep losses.
As it stands right now, Blankfein will be among the few Wall Street CEOs to collect a bonus this year. After this week's dismal results, Morgan Stanley (MS, Fortune 500) Chairman and CEO John Mack and Bear Stearns (BSC, Fortune 500) chief James Cayne both announced they would forsake their 2007 bonuses.
While bonuses are common throughout corporate America, they are a far bigger part of overall compensation for all levels of employee pay on Wall Street than they are at a typical corporation.
Tom McMullen of the Hay Group, a human resources and management consultant, estimates that cash bonuses typically equal between 40 and 100 percent of base salary for top executives on Wall Street, while senior managers receive between 15 to 30 percent of base pay as bonus payments. Even entry-level employees might see 10 to 20 percent of their base pay in the form of a bonus.
This year was expected to be a difficult one for finance pros given the recent market turmoil and the ongoing credit crisis. Overall, financial firms were expected to cut bonuses up to 10 percent from a year ago, according to industry projections.
A year ago, bonuses on Wall Street reached a record $23.9 billion, averaging more than $136,000 per employee, according to the New York State Comptroller's office.
Facing the biggest bonus squeeze were those individuals working in mortgage-related areas, with their bonuses declining by as much as 50 percent from a year ago, according to a report published last month by the compensation research firm Options Group.
Even though dealmaking has slowed considerably on Wall Street, investment bankers are still expected to enjoy a bump in their annual bonus from a year ago given the frenetic pace of merger-and-acquisition activity in the first half of 2007.
With so many banks underperforming, many financial firms were widely expected this bonus season to shift from cash to stock in an effort to compensate employees while retaining talent. Some firms have already said they would cap their cash compensation, including UBS, which announced a limit of $750,000 for its workers.
Goldman Sachs (GS, Fortune 500) stock finished more than 3 percent higher in Friday trade
