Goldman Sachs boss admits job cull should have been made sooner when ‘slowdown’ was apparent
David Solomon told a gathering of Goldman Sachs executives that he should have cut jobs and slowed the investment bank’s hiring of new staff earlier in 2022 .
Solomon was reported by the Financial Times as telling colleagues he had been too slow to reduce Goldman’s headcount.
“As the environment was growing more complicated in Q2 of last year, every bone in my body believed we should be much more aggressive in slowing hiring and reducing headcount,” Solomon said, according to someone with knowledge of the remarks.
A bank spokesperson said, “it would have been unusual not to address the process on headcount reduction this year” at the partner meeting.
The banking giant cut 3,200 workers in January having suffered a slowdown in dealmaking and racking up substantial costs as a result of its foray into consumer banking.
In the final quarter of 2022, profit dropped 44 per cent in the quarter ending 31 December 2022 compared to the same period last year. Goldman’s earnings per share slumped to $3.32, down from $10.81 last year and substantially below analyst estimates of $5.25.
More scrutiny was directed at Goldman after it reissued financial reports showing its new consumer banking arm had racked up substantial losses.
Platform Solutions – a new unit housing fintech and many of Goldman’s consumer banking products such as the Apple Card and Greensky – has lost $3bn since 2020 according to the reports.
Solomon had previously admitted to trying to do “too much too quickly” on Marcus and consumer banking.