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Goldman Sachs is preparing to cut a few hundred employees as part of an annual review process that targets staffers who are deemed underperformers, according to a person familiar with the matter.
The cuts, which are expected across the bank, could start in the next few weeks. They are anticipated to take a few months to complete, according to the person who has been briefed on Goldman’s plans.
Goldman had 44,400 employees worldwide at the end of June. The annual performance reviews, which tend to happen in the fall, can result in the Wall Street bank dismissing hundreds of staffers or even a few thousand.
The bank paused its annual so-called strategic resource assessment during the coronavirus pandemic and restarted the process in 2022.
Like last year, Goldman expects the performance-related job cuts to be on the low end of its targeted range of between 1 per cent and 5 per cent of its overall staff.
At the same time, the bank plans to continue hiring. As a result, Goldman expects to have a higher overall headcount by the end of this year, even including the expected job cuts.
“Our annual talent reviews are normal, standard and customary, but otherwise unremarkable,” Goldman spokesperson Tony Fratto said in a statement. “We expect to have more people working at Goldman Sachs in 2024 than 2023.”
The Wall Street Journal first reported Goldman’s plans to carry out performance reviews and lay-offs this year.
The news comes two days after Goldman won a slight reprieve from the Federal Reserve tied to the big bank’s annual stress tests.
Goldman had been one of the worst performers in this year’s tests, which were published in June. But Goldman won an appeal against the test results, which the bank said failed take into account recent changes it had made to make its results more stable.
The win on appeal could free up more than $100mn that the bank can leverage to boost lending, trading or other activities.
Shares of Goldman, which recently hit an all-time high, are up more than 30 per cent this year to a recent $510.
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