The board of Goldman Sachs (GS) awarded CEO David Solomon a 24% compensation increase for 2023 despite a profit decline and a dealmaking slowdown, offering a new show of support for Solomon after his most challenging year as boss.
Solomon's compensation for the year was $31 million, the bank disclosed Friday. Not only is that up from the $25 million he was awarded in 2022, it is more than his rivals Brian Moynihan and Charles Scharf made at Bank of America (BAC) and Wells Fargo (WFC).
Only JPMorgan Chase (JPM) CEO Jamie Dimon and outgoing Morgan Stanley (MS) CEO James Gorman were awarded more for their 2023 performance. Citigroup (C) has yet to disclose 2023 compensation for its CEO Jane Fraser.
The compensation increase could be a sign that board support for Solomon is solidifying after he spent much of 2023 attempting a tricky retrenchment from consumer lending while focusing the firm on its core strengths of trading, asset management, and investment banking.
Profits were down 24% at the Wall Street giant as dealmaking slowed across the industry and the firm absorbed costs associated with its consumer lending exit.
Its full-year net income of $8.52 billion was the worst mark for Goldman since 2019, Solomon's first full year in charge. The firm did, however, post a sizable gain in the fourth quarter as equities trading and wealth management rose.
A lot is in flux at Goldman as key executives depart, raising new questions about the race to eventually succeed Solomon.
One surprise exit in 2024 is Jim Esposito, who had been co-head of Goldman’s global banking and markets division and is leaving after nearly three decades. Esposito had been viewed on Wall Street as among the possible successors to Solomon.
That departure could focus attention on other potential CEO candidates, including president John Waldron, asset and wealth management head Marc Nachmann, or one of the other co-heads of the investment banking and trading operations.
Even the board of Goldman is changing. Last month ex-Goldman CFO David Viniar was named as the board’s lead director to replace Adebayo Ogunlesi, who stepped down after selling his infrastructure investment company to BlackRock.
The board awarded Solomon, who serves as board chair, $29 million in a discretionary bonus of which 70% is performance-based stock units. His $31 million in compensation also includes a base salary of $2 million.
Goldman’s stock peaked in August 2021, in the middle of the last dealmaking boom, at $420.73. Since Solomon was named CEO in October 2018, it has risen 72%. Year to date, the stock is down slightly.
David Hollerith is a senior reporter for Yahoo Finance covering banking, crypto, and other areas in finance.
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