Blankfein’s pay to rise 10% to $23 million for 2013
Lloyd Blankfein, chairman and chief executive of Goldman Sachs, may earn as much as $23 million in 2013 – a 10 percent increase on the previous year – despite the bank's struggle to overcome a slump in fixed income trading.
His rise comes as the bank cut bankers' bonuses across the board, with the payroll falling 3 percent to $12.6 billion for a pay-to-revenues ratio of 36.9 percent, a percentage point lower than at the end of 2012.
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Mr Blankfein was awarded 88,422 in restricted share units, according to a filing with the Securities and Exchange Commission, that are worth $14.7 million based on Goldman's closing share price of $165.84 on Thursday.
The restricted stock units, which typically total about 70 percent of his bonus, mean he is expected to be paid another $6.3 million in cash. That is in addition to his $2 million salary, taking his overall package to $23 million.
That figure does not include notional long-term incentives that will be disclosed later in the year.
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Mr Blankfein is on track to be paid more than Jamie Dimon and James Gorman, chiefs of JPMorgan and Morgan Stanley respectively. Mr Dimon got a 74 percent pay rise in 2013 to $20 million. Mr Gorman's stock bonus in 2013 rose by 88 percent to $4.9 million. Other big US banks are yet to announce their executive pay deals.
Goldman saw a strong year for equity underwriting in 2013 but endured its worst year for fixed income trading since 2005.
Goldman will disclose the specific cash portion for 2013 in the coming weeks. In 2012, Mr Blankfein's stock and cash bonus, as well as salary totaled $21 million, meaning he is set for a 10 percent increase in 2013.
"The numbers shock the consciences of most people," said the head of corporate governance at one of Goldman's large shareholders. "Our discipline as shareholders is not to focus on the raw number and rather on the philosophy of pay for performance."
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Equity underwriting at the Wall Street bank was lifted by high profile initial public offerings such as Twitter, which helped Goldman to more than double equity underwriting in the fourth quarter from a year ago.
The bank has avoided the regulatory headaches felt at JPMorgan, which made vast payouts in legal settlements last year as it tried to put its mortgage woes behind it. But, Goldman Sachs has felt other regulatory headwinds such as the Volcker rule that has ruled out proprietary trading at US banks.