Goldman Gives Blankfein $6 Million Long-Term IncentiveMichael J. Moore
Goldman Sachs Group Inc. awarded Chief Executive Officer Lloyd C. Blankfein a $6 million cash bonus to be paid out in three years if he meets certain targets, on top of $23 million in 2013 compensation.
The award can shrink or grow depending on whether the firm achieves return-on-equity and book-value targets, the New York-based bank said today in a filing. The long-term incentive was $5 million last year and $3 million in 2012.
Blankfein, 59, was the highest-paid CEO among peers at the largest U.S. banks for a second straight year. Goldman Sachs had an 11 percent return on equity in 2013, topping its largest Wall Street rivals, as it cut compensation costs amid revenue that was little changed. The stock rose 39 percent last year, beating the 33 percent gain for the Standard & Poor’s 500 Financials Index.
Wall Street firms including Goldman Sachs, which already gives a majority of top executives’ pay in restricted stock, have been seeking ways to encourage managers to focus on long-term performance.
Details of Blankfein’s pay were contained in the bank’s proxy statement for its annual shareholders’ meeting, which will be held on May 16 in Irving, Texas.
Blankfein’s total compensation package of $29 million topped the $20 million given to JPMorgan Chase & Co. CEO Jamie Dimon, 58, and the $18 million for Morgan Stanley CEO James Gorman, 55. Bank of America Corp. CEO Brian T. Moynihan, 54, received $14 million and Citigroup Inc.’s Michael Corbat, 53, got $14.5 million.
While the Goldman Sachs awards are initially tied to three-year periods, the board can opt to extend the measurement for an additional five years. In December 2012, the compensation committee set the performance period for the 2011 incentive pay to end in December 2018 instead of December 2013.
Blankfein’s compensation also included $14.7 million in restricted shares, which were previously disclosed, and a $6.3 million cash bonus in addition to his $2 million salary.
The firm granted President Gary D. Cohn, 53, a $6 million long-term award this year, bringing his total pay package to $27 million. Chief Financial Officer Harvey M. Schwartz, 50, received a $5 million incentive as part of $26 million in total compensation. Vice Chairman John S. Weinberg, 57, got a $4 million incentive as part of a $22.5 million package.
The firm capped the amount by which the incentive awards can increase based on ROE growth to 12 percent annually.
Top executives also received payouts from funds managed by the firm during the year, including profits, return of money invested, and their portion of the funds’ management fees, known as overrides. Including those overrides, the payouts during 2013 totaled about $33 million for Blankfein, $10.8 million for Cohn, $4.36 million for Schwartz, and $6 million for Weinberg, according to the proxy. J. Michael Evans, a vice chairman who oversaw emerging markets before departing the bank at year-end, got $4.62 million. Former Chief Financial Officer David Viniar received $13.1 million.
Other recipients of such fund distributions included Vice Chairman Michael S. Sherwood, 48, with $1.4 million; General Counsel Gregory K. Palm, 65, with $17.8 million; and Chief of Staff John F. W. Rogers, 57, with $2.5 million, the proxy showed.