Goldman-Sachs Denies Reports That It Will Pay Out Huge Bonuses
By Corky Siemaszko
Daily News Staff Writer
Goldman-Sachs denied reports Monday it's planning to pay out huge bonuses to top executives while the nation is mired in a recession.
"We won't know what our compensation benefit number is until the end of the fourth quarter, which is at the end of December," company spokesman Ed Canaday said.
Reports that Goldman bankers were planning to pay themselves the biggest bonuses ever in the firm's 140-year history are "pure speculation," Canaday said.
The rapid response from Goldman came after The Guardian, a respected London-based newspaper, and the Reuters news service, reported that Goldman employees in London were told a big payday was on the way.
Goldman is obligated to "ensure that compensation reflects the true performance of the firm and motivates proper behavior," CEO Lloyd Blankfein said in a letter to lawmakers last week.
The White House has called on Wall Street to rein in runaway bonuses and imposed limits on executive bonuses on firms that received billions in taxpayer funded money to keep from going under.
Goldman repaid the feds the $10 billion it got from the government last week.
"Our return of the government's investment does not, in any way, end our obligations to the public interest," the firm wrote in a letter to the Congressional banking committee.
That said, Goldman's decision to return the bailout money leaves it free to whatever it wants - even though millions of Americans are struggling to make ends meet.
The reason Goldman is on the gravy train is because the recession was good for the venerable firm, which saw a surge in revenues from trading foreign currency, bonds and fixed-income products.
U.S. banks like JP Morgan and Morgan Stanley also made money amid the financial misery. So did foreign financial titans like Barclays Capital, Credit Suisse and Deutsche Bank, Reuters reported.
All these firms pounced on potential profits following the near collapse and government rescue of major trading houses like Citigroup, Merrill Lynch, UBS and Royal Bank of Scotland.
advertisement
