Lloyd C. Blankfein’s top deputies are no longer equal in terms of pay at Goldman Sachs Group Inc. (GS:US)
President Gary Cohn, 52, was awarded a $19 million compensation package, 12 percent more than Vice Chairmen J. Michael Evans and John S. Weinberg, according to the New York- based firm’s annual proxy filing. The disparity is the first since 2007, when Blankfein’s bonus set the record for a Wall Street chief executive officer.
The change may further fuel speculation about which executive is most likely to succeed Blankfein, 58, who sometimes out-earned his own boss Henry Paulson. Blankfein, who succeeded Paulson as Goldman Sachs chairman and CEO in June 2006, said in a February interview with Bloomberg Television that he has plans to stay in the top job indefinitely.
“If somebody gets more money that could be a sign” that they’re in the running for the job eventually, said Jeanne Branthover, managing director at Boyden Global Executive Search in New York. “A partnership is very big about ‘what message are we giving each partner?’”
Evans, 55, the vice chairman who oversees Goldman Sachs’s emerging-markets business, received $17 million, as did Weinberg, 56, who helps oversee investment banking. David Viniar, who retired as the firm’s chief financial officer earlier this year, was awarded $19 million.
Cohn’s package for 2012 included a $5.15 million cash bonus. Evans and Weinberg each got a $4.55 million cash award.
Differences in pay among the named executive officers, or NEOs, were “primarily to reflect their individual performance, as well as their roles,” the bank said in the filing. “No specific individual performance goals were used by the committee in making these NEO compensation determinations.”
Blankfein received a larger bonus than his deputies for the first time since 2007, when he set a Wall Street pay record. All of Goldman Sachs’s named executives received no bonus in 2008, and then got cash and stock awards of $9 million, $18 million and $10 million over the next three years.
Blankfein got $21 million for last year, his highest annual package since 2007, as reported by Bloomberg News in January. That consisted of $13.3 million in restricted stock and a $5.7 million cash bonus for 2012 in addition to his $2 million salary, according to today’s filing.
That made him the highest-paid CEO among those at the 10 largest U.S. banks, exceeding the $9.75 million for Morgan Stanley (MS:US)’s James Gorman and $11.5 million awarded to JPMorgan Chase & Co. (JPM:US)’s Jamie Dimon.
Goldman Sachs, the fifth-biggest U.S. bank by assets, reported its first revenue gain in three years in 2012, as each of its four divisions showed an increase last year. The bank’s return on equity was 10.7 percent, up from 3.7 percent in 2011 while less than one-third of what the firm earned in 2007.
The stock rose 41 percent in 2012, the first annual increase since doubling in 2009. While the shares have rallied 16 percent this year, they’re still 12 percent below their level at the end of 2010.
Goldman Sachs’s compensation committee has been led by James A. Johnson, a former CEO of Fannie Mae, as long as the bank has been a public company. Johnson was re-elected to the board with about 84 percent of the vote at last year’s shareholder meeting, overcoming opposition from investment firm Ruane, Cunniff & Goldfarb Inc.
Goldman Sachs cut 900 jobs last year, and compensation costs rose 6 percent, trailing the 19 percent increase in revenue. In November, the firm named 70 employees to its so- called partnership, the fewest in 13 years as a public company, and said last month that it will start naming managing directors every two years instead of annually.
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