Blankfein’s eight-figure bonus
I’ve landed in London, where I woke up this morning to a classic piece of British journalism, under the headline “Lloyd Blankfein of Goldman Sachs ‘expecting $100 million bonus’“:
Goldman Sachs, the world’s richest investment bank, could be about to pay its chief executive a bumper bonus of up to $100 million in defiance of moves by President Obama to take action against such payouts.
Bankers in Davos for the World Economic Forum (WEF) told The Times yesterday they understood that Lloyd Blankfein and other top Goldman bankers outside Britain were set to receive some of the bank’s biggest-ever payouts. “This is Lloyd thumbing his nose at Obama,” said a banker at one of Goldman’s rivals.
It goes without saying, of course, that Goldman’s rivals couldn’t possibly know what Blankfein’s bonus is going to be. And given Goldman’s record-low compensation ratio this year, along with the bank’s cap on bonuses in the UK, it frankly boggles the imagination that he’s going to get anywhere near $100 million. Goldman knows that bonuses are a hot-button issue politically, and it’s going to keep them (relatively, by its standards) modest for 2009.
Blankfein — who hardly needs the money — knows full well that he can’t, this of all years, pay himself the largest bonus ever received by a bank CEO in the history of the world. As a result, his bonus is going to be less than the $68 million he made in 2007. It’ll probably be in the eight figures, but it won’t be anywhere near $100 million. No matter what Helen Power heard from gossipy bankers in Davos.