Dive Brief:
- Goldman Sachs plans to cut fewer than 250 jobs in the coming weeks, sources familiar with the matter told The Wall Street Journal on Tuesday.
- The cuts could be spread across seniority levels and include partners and managing directors, a source told Reuters.
- The move would mark Goldman’s third reduction in force over the past year. The bank slashed 3,200 positions in January, after cutting a few hundred in September — likely through a reinstated performance evaluation tool. The bank may make more performance-based reductions this September, sources told the Financial Times.
Dive Insight:
Senior executives at Goldman had earlier projected a turnaround in investment banking for 2023. But the March banking crisis added turmoil to a market already racked by interest-rate uncertainty and continued war in Ukraine.
Corporate dealmaking has dropped by about 44% so far this year, according to Bloomberg. Investment-banking revenue slumped 26% at Goldman during the year’s first quarter, compared to the first three months of 2022, The Wall Street Journal reported.
Goldman is hardly the only top-six U.S. bank making staff cuts this quarter. Its chief rival, Morgan Stanley, has discussed cutting roughly 3,000 jobs by the end of June — after having shed 1,600 positions in December.
Bank of America, meanwhile, disclosed in April that it cut 1,000 jobs early that month and planned to shed another 3,000 by the end of June.
Within the past week, JPMorgan Chase has indicated it would lay off roughly 1,000 employees of First Republic, the failed bank it bought this month. In the same vein, First Citizens Bank cut hundreds of Silicon Valley Bank veterans.
At a February investor day, Goldman President John Waldron said the bank was “determined to unlock” $1 billion in expenses it intended to pour into its core businesses. That figure includes $600 million in payroll reduction from the January job cuts and an effort to refill only critical roles after some workers leave through attrition, CFO Denis Coleman said, according to Bloomberg. The other $400 million would come through non-compensation expense efficiencies, Coleman added.
A representative for Goldman Sachs declined to comment to Bloomberg on the prospect of upcoming layoffs.
