Average Pay Of Goldman Banker Rises To $383,374 On Expectations Beat Despite Plunge In Order Flow

Tyler Durden's picture


Yesterday Bank of America beat thanks to (among other things) ye olde "plunge in the effective tax rate" gimmick which let it beat EPS by two cents instead of missing by three. Today it was Goldman's turn to "beat" lowered EPS expectations of $4.18, posting a substantial beat of $4.60. So did Goldman also fudge its tax rate? Not exactly: instead, what Goldman did was to reduce its compensation benefits from $2.4 billion to $2.2 billion, which meant the firm's compensation margin declined from 35.2% to a tiny 24.9% of revenue. Had Goldman kept the comp margin flat it would have missed EPS by about 50 cents. However, unlike the other "banks" Goldman at least did post a notable beat in GAAP revenues (it was reluctant to use a non-GAAP top line, hear that Jamie?) as well, with Q4 sales rising from $6.7 billion in Q3 to $8.8 billion, on expectations of $7.8 billion. However, compared to a year ago, the top line was 5% lower, while Net Income of $4.60 was 21% lower than a year earlier.

The reason for the decline in revenue was the plunge in Equity and FICC Institutional Client Flow, both of which tumbled by 27% and 15% respectively year over year, as more and more institutions just say no to trading. Which mean that Goldman's prop trading group had to pick up the slack and sure enough Investment and Lending, aka Prop, saw its revenue rise to $2.1 billion in the quarter, up 4.4% from a year ago and the third best quarter in post-Lehman history. Finally, Investment Banking revenues of $1.7 billion also posted a notable increase of 22.3% Y/Y as Goldman's bankers rushed at the opportunity to advise on the surge in equity and debt offerings and occasional M&A deals.

Finally, even though Q4 comp benefits of $2.2 billion did decline from Q3, it was modestly higher than a year ago, which means that the average compensation per average Goldman banker rose modestly to $383,374. Remember, though: there is no such thing as an "average" Goldman banker.

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Thu, 01/16/2014 - 09:06 | 4337343 RSloane
RSloane's picture

Some tribes are more equal than others.

Thu, 01/16/2014 - 09:13 | 4337351 TeamDepends
TeamDepends's picture

Hey, slaughtering muppets is hard work.

Thu, 01/16/2014 - 09:14 | 4337354 Mae Kadoodie
Mae Kadoodie's picture

Just doin' a lil bit of G_d's Work.

Thu, 01/16/2014 - 09:27 | 4337398 augustusgloop
augustusgloop's picture

Change ticker to YHWH

Thu, 01/16/2014 - 09:35 | 4337425 Oh regional Indian
Oh regional Indian's picture

Haaah, I read RSloane's comment as : "Some bribes are more equal than others"...

And wall street = The tribe of Ham (Pig)


Thu, 01/16/2014 - 10:59 | 4337722 SAT 800
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Net income was lower than last year; must be because of the economic recovery.

Thu, 01/16/2014 - 09:09 | 4337344 GetZeeGold
GetZeeGold's picture



Thanks for the bailout guys!


America......what a country. You can screw up really bad.....and the taxpayers will still have your back.

Thu, 01/16/2014 - 09:16 | 4337360 Sudden Debt
Sudden Debt's picture

taxpayers don't have their back. Taxpayers just don't give a fuck because they believe the government will always have enough money to take care of them.

Thu, 01/16/2014 - 09:10 | 4337347 Sudden Debt
Sudden Debt's picture

I took the wrong job...

had to go for a respectable job... marketing...

and in a crisis, it's more flatering to be a pimp than a marketeer...

Thu, 01/16/2014 - 10:13 | 4337543 Son of Loki
Son of Loki's picture

Maybe some of those 2,000 fired JCP emnployees or 2,500 layed off Macy's employees can grab a job at GS? That'd help their situation tremendously...a move up the ladder.

Thu, 01/16/2014 - 09:14 | 4337355 Dr. Engali
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Despite the fact that earnings are no where near 2007 this should drive GS to a new all time high. Nope no bubble here.

Thu, 01/16/2014 - 09:14 | 4337356 TheInfoman
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I thought these banks were tetering on the brink of insolvency.

Thu, 01/16/2014 - 09:18 | 4337361 GetZeeGold
GetZeeGold's picture



I think you're thinking about middle-class America.

Thu, 01/16/2014 - 09:19 | 4337368 Sudden Debt
Sudden Debt's picture

that was last week, they're okay this week.

Thu, 01/16/2014 - 09:20 | 4337376 Seasmoke
Seasmoke's picture

God must very happy today. 

Thu, 01/16/2014 - 09:24 | 4337390 firstdivision
firstdivision's picture

Wow, only $383k/yr!  How does someone survive on such a meger wage?  They contribute so much to the world, that without them, this world wouldn't be worth living in.  Can we put more santas with bells on the streets to collect money for them?

Thu, 01/16/2014 - 09:36 | 4337427 Sudden Debt
Sudden Debt's picture

most of them also have a paper route and flip burger afterhours at McDonals to get by...


Thu, 01/16/2014 - 09:57 | 4337488 Oldwood
Oldwood's picture

For anyone who has ever tried to climb a tree, they know its a lot harder climbing back down. I guarantee you that the majority of these people are living farther beyond their means than someone making $35k/yr. The difference is that they have more power and will do just about anything to stay afloat. Saving a weak child from drowning is one thing but try and save a strong, athletic person and they will likely take you down with them. These guys will not walk away from this easily, especially the higher you go up the tree. They will burn down the house to stay in the game.

Thu, 01/16/2014 - 09:46 | 4337458 Oldwood
Oldwood's picture

Just as a point of my ignorance, what does Goldman "sell"?

"with Q4 sales rising from $6.7 billion in Q3 to $8.8 billion, on expectations of $7.8 billion"

Thu, 01/16/2014 - 10:02 | 4337505 SDRII
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includes 1.4B in gains on IPOs, and public equity gains


keep pumping

Tue, 01/21/2014 - 02:14 | 4350748 shawnmike
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