Goldman Sachs Cuts CEO David Solomon’s Pay by $25 Million in 2022

Goldman Sachs Group Inc. is a leading global investment banking, securities and investment management firm that provides a wide range of financial services to a substantial and diversified client base.

David Solomon, the chief executive of Goldman Sachs, took a pay cut of nearly 30% in 2022.

Mr. Solomon's total compensation last year was $25 million, down from $35 million in 2021. His pay package for 2022 consisted of a $2 million base salary, a cash bonus of $6.9 million, and a $16.1 million stock award that is tied to the bank's performance over the next few years, according to Goldman's regulatory filing.

Mr. Solomon's compensation for 2022 will be based on the bank's performance compared to 2021, Goldman said in a filing. Profit fell 48% last year, and revenue declined 20%, largely due to a slowdown in corporate deal-making. However, Goldman shares outperformed the KBW Nasdaq Bank Index and the broader S&P 500 last year.

In 2021, the bank's shares were soaring and the bank was minting money in a merger boom that kept its high-price bankers busy. The bank's success was due to its aggressive expansion strategy and its willingness to take on risky deals.

Goldman Sachs doubled CEO David Solomon's pay in 2019, after the bank posted record profits. This came after a year in which Solomon was penalized for the firm's involvement in the 1MDB corruption scandal. Goldman also awarded Solomon a one-time stock award of about $30 million in 2019, citing "the rapidly increasing war for talent in the current environment."

Late last year, Mr. Solomon reorganized Goldman's businesses to emphasize steadier businesses like asset and wealth management, rather than its more volatile Wall Street operations. This was meant to create more stability for the company overall.

Goldman Sachs CEO David Solomon is scaling back the bank's consumer-facing Marcus operations, admitting that Goldman's attempts to do too much there contributed to missteps. The bank's newly created Platform Solutions division, which houses credit cards and other pieces of the consumer business, lost about $2 billion on a pretax basis in 2022.

Mr. Solomon has taken steps to reduce costs at Goldman. The bank laid off 3,000 employees this month and reduced bonuses for many bankers by up to 40%.

Goldman's compensation committee also took into account the bank's "continued progress in its strategic evolution," as well as Mr. Solomon's "strong individual performance and effective leadership," according to the filing.

Mr. Solomon's pay fell more than that of his Wall Street counterparts.

Morgan Stanley paid Chief Executive James Gorman $31.5 million for his work in 2022, a 10% pay cut from the year before.

JPMorgan Chase & Co. awarded CEO Jamie Dimon $34.5 million in 2022 compensation, which was the same as his pay the year before.

Wells Fargo & Co. CEO Charles Scharf’s 2022 pay also stayed flat at $24.5 million.