Friday, December 4, 2009

Top Goldman Sachs Executives Are Likely to Receive Their Annual Bonuses in Stock

Top Goldman Sachs executives are likely to receive their annual bonus in stock this year rather than cash as part of a pay review that could affect thousands of Goldman’s rank-and-file employees, reports FT.

Ft goes on:

In a bid to quell public anger over probable multi-million dollar pay-outs to Goldman’s most successful bankers and traders after a bumper year for the bank, Lloyd Blankfein, its chief executive, is weighing plans to increase the share of compensation paid in equity.

Senior executives including Mr Blankfein could be awarded all their annual bonus in company stock, people familiar with the bank’s thinking told the Financial Times. Many of its 31,700 staff may also receive more of their annual bonus in deferred stock or options.
This will raise more questions than it answers. Will bonus recipients be allowed to sell the stock whenever they chose? Will they be able to "collar" their positions to lock in their bonuses anounts? Will top quality producers stay at GS, if they can perform their services elsewhere and not be limited by their cash bonuses elsewhere, as they are at Goldman because of Goldman's amateur night public relations effort and tainted dealings with government?

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