Goldman Sachs Plans Further Job Cuts For Underperformers: FT

Goldman Sachs is planning a new round of job cuts for underperforming employees, Financial Times reported citing people familiar with the matter. The planned cut is said to be under its annual strategic resource allocation scheme and is likely to impact 1 percent to 5 percent of the total workforce, mostly at the lower end of the range.

The banking major is expected to announce the workforce reduction as early as next month.

As per the report, the job cuts will be in its investment banking and trading businesses, as part of its yearly performance review process. Among the total headcount of Goldman, the proposed 1 percent reduction would equal about 440 jobs.

Goldman managers have prepared lists of employees who could be dismissed, while final numbers are yet to be decided, FT said.

The company, which reduced 500 employees in September 2022, had substantially downsized its headcount this year. In January, the bank cut nearly 3,200 jobs, or 6.5 percent of its workforce as part of its efforts to cut costs amid slowdown in investment banking activity and losses at its consumer banking business.

In December last year, Bloomberg had reported that Goldman planned to eliminate at least 400 positions from its loss-making retail banking operations, as the bank restructured its consumer business. CEO David Solomon reportedly had warned then that the bank might have to be a little more cautious with its financial resources.

In July, Solomon reportedly said that the company had resumed its regular performance-based job cuts, which were halted during the pandemic.

In its latest second quarter, Goldman’s net profit fell 58.5 percent, attributed to the decline in market-making and investment banking activity levels. Revenue dip was more than 8 percent caused by a 20-percent drop in investment banking revenues and a 11-percent decline in market making revenues. Goldman Sachs, which commands a deposit portfolio of less than $400 billion, saw its deposits rise more than 6 percent during the quarter.

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