In a return to pre-pandemic practice of hiving off low-performing staffers from the bank, Goldman Sachs is set for a round of job cuts.
The US investment bank is set to axe jobs in plans that could trigger the earliest layoffs as soon as next week, The New York Times reported, according to people familiar with the matter.
The number is less than previous rounds of staff cuts but signals a return to staff cuts that were part of an annual routine before Covid hit in 2020. As part of this process, the bank would let go of between 1% and 5% of its staff.
READ Bank job cuts are coming — here’s what you need to know
The latest move to resume job cuts comes amid a slump in dealmaking alongside soaring inflation and a fierce drop in M&A activity after a boom last year pushed Goldman to a $130bn fee level across the sector, the highest since the heady years just prior to the crisis of 2008.
In August, Goldman also cut the amount allocated to pay its London bankers by nearly 60% for the first half of 2022.
The bank’s CFO Denis Coleman also noted in July plans to reinstate Goldman’s “annual performance review of our employee base at the end of the year”.
Goldman made $531m from investment banking fees in the first six months of 2022 in its international unit, 61% lower than last year. In its fixed income trading unit, revenue was up by 59% to $2.7bn and equity trading was up 2% to $2.5bn. So far this year, Wall Street banks have offset sharp declines in investment banking fees with strong performance within their trading units.
Goldman declined to comment.
FN’s newsletters are now free — from asset management to investment banking, green finance and tech news — sign up to get them all here
To contact the author of this story with feedback or news, email Penny Sukhraj