Bank on Banking » goldman sachs

In the News: Wow…Now That’s Compensation!

IBanker — Wed, 15 Jul 2009 02:09:40 +0000

After reporting a chart-topping and record-breaking quarter, Goldman Sachs is rumored to be leaning towards paying their biggest bonuses ever. Of course it is still early over at the sunny corner of town (Goldman HQ, of course), but assuming Q3 and Q4 follow suit, or at least hold their own and don’t completely fall apart, Goldmanites should enjoy bonuses hearty enough for two. Historically, Goldman has paid less out than the rest of the Street (on a bonus to revenue ratio basis, obviously not on a whole dollar basis) – probably since Goldman earned so much more, and the Street wanted to try to keep up with incentives – however, all of that is about to change as the whispers have foretold of Goldman’s plan to kick up the % from 43% or so, to 49% (in line with the Street). This 49% could mean that Goldman will pay bonuses totaling over $20 billion to a workforce that has been reduced by an overall 1% since last year (again, we’re only half way through the reporting year so things can change – but damn that is some sweet action).

http://www.businessinsider.com/goldman-is-paying-itself-even-more-than-2007-record-bonuses-2009-7

Goldman Riding High…

In the News: This Time It Will Definitely Work…Right?

IBanker — Thu, 09 Jul 2009 01:43:33 +0000

It’s that time again…you know the one…when banks turn garbage into gold, crap into caviar; in other words, subprime loans into AAA bonds. Morgan Stanley has picked up the pieces and is selling over $87 million of securities (CDOs to be specific) that it expects to receive AAA credit ratings.

In spite of everything, we are back to printing money – while Morgan Stanley is the first to once again run with CDOs, several other banks have already started repackaging commercial mortgage-backed securities, with several more banks waiting in queue. Another company planning a similar repackaging is Goldman Sachs, who plans to flip nearly $217 million in commercial mortgage debt. Over the last three weeks, banks have issued nearly $2 billion in debt – to put that in perspective, over the entire 2008, banks issues just $5.8 billion. The upside here is in the fact that with asset values in the toilet, the risk in further value destruction should be much smaller than in the boom of two years ago when values were through the roof. Nevertheless, this one should be watched as it could quickly get interesting.

I Love 2006!

In the News: We Have Seen the Light! 10 Banks Revealed and No Salary Caps

IBanker — Wed, 10 Jun 2009 12:24:53 +0000

As a quick follow-on to yesterday’s post, here are the 10 banks that will be repaying TARP in the first wave. Morgan Stanley is on the list, so it looks like Mr. Mack has played his cards right and is on his way to bringing MS back to the top baby! Surprisingly, one of the banks that everyone expected to be running towards to the opportunity to pay back the TARP funds, Wells Fargo, is not on this list, which means either they have decided not to repay just yet, or they are not being allowed to repay just yet – hmm.

10 Big Boys Shoving the Government Dole

1. JP Morgan – $25 billion

2. Goldman Sachs – $10 billion

3. Morgan Stanley – $10 billion

4. U.S. Bancorp – $6.6 billion

5. Capital One – $3.6 billion

6. American Express – – $3.4 billion

7. BB&T – $3.1 billion

8. Bank of NY Mellon – $3.0 billion

9. State Street – $2.0 billion

10. Northern Trust – $1.6 billion

Part 2 of this post refers to Obama’s salary caps, or, should I now say, his lack thereof. The good news (as you can probably tell from the title): the proposed salary caps that team Obama was seriously considering have, thankfully, been squashed. The bad news: the broader regulations (more likely recommendations, which begs the question: how effective can recommendations really be?) that have not yet been fully described are barreling towards us as planned, and Congressional bonus restrictions will be fully supported by team Obama.

One aspect of the broad recommendations that has been hinted at involves appointing a “pay czar,” who will be in charge of monitoring the salary practices of those institutions that received (and still have) TARP funds. Geithner, in his usual merry way, is pushing to monitor all firms, not just TARP firms, to more closely tie incentive compensation long-term performance by paying bonuses in restricted stock, as opposed to the more traditional cash and stock plans (unless Timmy doesn’t know that most bonuses are paid cash up to a point, and then the rest in stock that has a vesting period). It all sounds very exciting and the full briefing is due out today/tomorrow.

10 Banks Revealed

Goodbye Salary Caps

In The News: BofA Following Goldman’s/JP Morgan’s Footsteps – No, Seriously

IBanker — Thu, 21 May 2009 20:11:55 +0000

By now, most of you should know that Goldman Sachs is leading the TARP payback charge. Anxious to remove the government’s sticky fingers and crotchety tone from their bank haven, Goldman has made it clear that they are planning to pay the TARP money back ASAP – and in their case, ASAP is not code for sometime between now and 27 years from now, but rather in the next few months if not less. Nipping at their heels, Mr. Dimon has also voiced his plans to pay the TARP funds back in quick manner, and not to be outdone by GS, intends this timeframe to not span longer than a few months. No big surprises so far, I mean it is essentially #1 vs…well…#1, so of course they are eager to get back to crushing the competition and taking advantage of opportunities. And here’s the twist, the shocker, the “holy crap,” if you will…Bank of America is planning the same thing – a FULL TARP funds return – $45 billion!

I was shocked when I read it too, and while it could all just be for show, as it stands right now, BofA is claiming that they will be ready, willing and able to pay the TARP funds back, in their entirety, by year end. While this is not as fast as GS or JPM, come on, it’s BofA for goodness sake – I was expecting those TARP funds to stay out through at least 2012. Time will tell whether there is any validity to the claims, and any truth to the words. As it stands right now, however, it would appear that BofA fully intends to be government free by the end of the year.

Bank of America has the $

In the News: JP Morgan – The New Goldman Sachs

IBanker — Sun, 26 Apr 2009 23:48:43 +0000

JP Morgan is #1 – apparently it has knocked the crown off of the head of Goldman Sachs.

I am not even going to comment on this story, take a gander at the Portfolio article, and leave your thoughts and outrage (or delight) in the comment section below.

JPM Takes them all DOWN