'The Street is ecstatic'
BY NICOLE BODE and PHYLLIS FURMAN
DAILY NEWS STAFF WRITERS
Investment banking giant Goldman Sachs opened the holiday bonus season yesterday with the stunning announcement that it was setting aside a bodacious $16.5 billion cash pool for its employees.
Goldman's gold rush translates into an average payday of $622,000 per employee - although big shots like top investment bankers and traders will pocket millions, while the rank and file will score far less.
Goldman's bonanza marks the start of what is set to be a record-breaking bonus period on Wall Street, pumping millions of dollars into bankers' pockets while fueling big spending in the city.
"People are happy, the Street is ecstatic," said Gary Goldstein, CEO of Wall Street executive search firm Whitney Group.
One sure winner will be Goldman Sachs CEO Lloyd Blankfein, who got the top job earlier this year. Goldman's top dog is expected to get a big bump on his total 2005 pay of $30.8 million.
"It could hit between $40 million and $50 million," one Wall Street insider told the Daily News.
Goldman employees are set to learn what their exact share of the massive winnings will be this week.
Asked what he expected to get, a big grin spread across the face of one employee outside the firm's headquarters at 85 Broad St. yesterday. "They told us we can't talk about it," he said.
"Everyone is hopeful for what might happen," another said. Given the differing levels of responsibility across the firm, "the mood is different on every floor."
But another worker said the money shower won't land on him. "I'm just support staff - we don't get bonuses," he complained.
Goldman will hand out the bling after announcing yesterday that it scored record-breaking earnings this year of $9.5 billion, the most in Wall Street history.
This is the same firm that got $115 million in tax breaks and a commitment of up to $1.65 billion in low-cost Liberty Bonds from the city and state to build its new headquarters across the street from Ground Zero.
Goldman's mega-bonus jackpot means its rivals will be forced to follow suit to keep the rainmakers from jumping ship.
"The firm's earnings set the tone for other bulge-bracket firms to step up to the plate," said Michael Karp, CEO of the Options Group, a New York-based executive search and consulting firm.
"Morgan Stanley, Lehman and Bear Stearns will follow next [with bonus reports]," Karp said. "Now that Goldman has opened up the season in a very big way, every other firm will have to pay their employees big to try and keep up."
http://www.nydailynews.com/front/story/479768p-403586c.html
Originally published on December 13, 2006
