Voice-mail boxes inside Goldman Sachs lit up on Jan. 21 with an unusual message from the bank’s chief executive — a bit of Wall Street speak that sounded like the makings of a book on Zen and the Art of Money-Making.
“In a year that proved to have no shortage of story lines, I believe very strongly that performance is the ultimate narrative,” the chief, Lloyd C. Blankfein, said in the companywide message. He then celebrated the bank’s record profits in 2009 and discussed its plans to pay bonuses to its employees.
Left unanswered now, as then, is the question that all of Wall Street has been chewing on for months: How much will Mr. Blankfein be paid for his remarkable — and controversial — success in running Goldman ?
Anxious executives at rival banks are awaiting the news with a mixture of envy and alarm. Guesses range from nothing to $100 million. Whatever the final figure is — high, low, or somewhere in between — it will set a new benchmark for pay throughout the industry. Goldman Sachs insisted on Wednesday that no decision had been made.
Goldman employees offered various interpretations of Mr. Blankfein’s voice-mail message, one of dozens that he has left since becoming chief in 2006. Many agreed on one point, however: The message was somehow linked to the uproar in Washington and elsewhere across the country over resurgent profits and pay at big banks like Goldman.
Some heard in the message a call to keep quiet about the many billions of dollars in bonuses that Goldman is paying. Others said Mr. Blankfein seemed to be suggesting that Goldman employees, rather than policy makers or the news media, would write their success story by doing what Goldman does best: make money.
Lucas van Praag, a spokesman for Goldman, said everybody got the message, which was that “performance speaks for itself.”
Many other big banks disclosed the compensation of their top executives in recent weeks, and Goldman was widely expected to do the same by now. The delay has spawned a number of reports about what Goldman will do. The Times of London, for instance, reported this week that Mr. Blankfein might receive a mind-boggling $100 million, a figure that would eclipse his previous record of $68 million in 2007. He took no bonus in 2008.
“There is speculation, and then there is stupidity,” Mr. van Praag said. “This speculation transcends the simply stupid and takes it to an entirely new level.”
Even so, Goldman is undoubtedly making some careful political and business calculations. The bank also may be biding its time and waiting for an opportune public relations moment to break the news.
Nearly everyone on Wall Street focuses on the Number, the annual bonus that makes up the vast majority of compensation for bankers and traders. But this year, Mr. Blankfein must also consider what one public relations specialist called the Gag Number — how much he can be paid without unleashing another round of bonus-bashing in Washington.
That limit is uncertain. What is sure is that the politics of pay are as heated as ever. Two Democratic senators, Barbara Boxer of California, and Jim Webb of Virginia, plan to propose legislation on Thursday that would tax bonuses for top executives at companies that received billions of bailout dollars during the financial crisis. Like most big banks, Goldman paid back the money, with interest.
Who decides Mr. Blankfein’s pay? The answer may come as a bit of a surprise. Goldman’s compensation committee comprises 10 outsiders. Among them are Ruth J. Simmons, the president of Brown University; the billionaire steel magnate Lakshmi N. Mittal; and James A. Johnson, the Washington insider and former chief executive of Fannie Mae, who was forced to resign as head of the vice presidential vetting committee for Barack Obama in response to a variety of accusations about corporate missteps. None of those three could be reached for comment on Wednesday.
Whatever the size of Mr. Blankfein’s bonus, it will come in the form of long-term stock, rather than cash. Goldman, in a nod to public opinion, has already announced that he and 29 senior executives would forgo cash payments.
Once the compensation committee decides how much stock Mr. Blankfein and those executives should receive and at what price, and the stock is awarded, Goldman has 48 hours to file a Form 4 with the Securities and Exchange Commission. Over the last week or so, people up and down Wall Street have been keenly watching the S.E.C. Web site for Mr. Blankfein’s filing.
Goldman, meanwhile, has quietly told its thousands of other employees what they might expect for their bonuses. Other Wall Street chiefs have revealed their paydays. Morgan Stanley, for instance, recently announced that its new chief executive, James P. Gorman, was getting about $11 million or $12 million. But others, like Jamie Dimon of JPMorgan Chase, who is expected to be paid $15 million to $20 million, appear to be waiting for Mr. Blankfein’s announcement — and the reaction to it — before announcing their own bonuses.