Goldman Sachs raises banker pay and bonuses after 150% surge in quarterly profit

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Goldman Sachs has increased banker pay including bonuses by 17% after profits more than doubled in the second quarter, following a rebound in dealmaking. The Wall Street firm said it spent $4.2bn (£3.2bn) on compensation and benefits for its 45,300 staff in the three months to June, up almost a fifth from the same period last year. That figure accounts for salaries and pensions, as well as the amount being put aside for individual bonuses that are distributed at the end of the financial year. Overall, Goldman has spent $8.8bn on compensation and benefits for staff since January, which the bank said reflected “improved operating performance”. Financial filings show that Goldman’s profits surged 150% to $3bn in the second quarter, up from $1.2bn last year. Profits were boosted by a jump in business deals, with its investment bankers helping guide firms through a fresh wave of mergers and takeovers. That includes ExxonMobil’s $60bn takeover of Pioneer Natural Resources in May, for which Goldman acted as a broker alongside the rival banks Morgan Stanley and Citigroup. Goldman’s chairman and chief executive, David Solomon, said: “We are pleased with our solid second-quarter results and our overall performance in the first half of the year, reflecting strong year-on-year growth in both global banking and markets and asset and wealth management.” Investment bankers are emerging from a two-year slump in dealmaking, which was affected by high borrowing rates and economic uncertainty. A brighter economic outlook, as well as expectations that the Bank of England and US Federal Reserve will cut interest rates, has boosted demand for services from banks such as Goldman Sachs. That is likely to translate into larger bonuses, including for Goldman’s 6,000 UK staff, who will no longer be bound by a banker bonus cap that previously limited bonuses to twice the individual’s salary. The UK bonus cap was originally part of changes introduced after the 2007-08 banking crash, and aimed to stamp out a bonus culture blamed for encouraging short-term profits over longer-term stability. Prior to Labour’s general election victory, the incoming chancellor, Rachel Reeves, said the party had no plans to reinstate the banker bonus cap. skip past newsletter promotion Sign up to Business Today Free daily newsletter Get set for the working day – we'll point you to all the business news and analysis you need every morning Enter your email address Sign up Privacy Notice: Newsletters may contain info about charities, online ads, and content funded by outside parties. For more information see our Newsletters may contain info about charities, online ads, and content funded by outside parties. For more information see our Privacy Policy . We use Google reCaptcha to protect our website and the Google Privacy Policy and Terms of Service apply. after newsletter promotion Richard Gnodde, the chief executive of Goldman Sachs International, announced in May that the bank would be changing its pay structure, giving hundreds of its highest-earning staff the ability to make 25 times their salaries in bonuses.