You are here
Goldman eyes cost cuts: CEO
[NEW YORK] US banking giant Goldman Sachs is weighing cost cuts to deal with a slowing global economy, its chief executive Lloyd Blankfein said Tuesday.
A person with knowledge of the situation said Goldman intends to slash at least five per cent of its total workforce this year.
Speaking a day after Goldman shares plunged 4.6 per cent amid rising market worries over credit quality in banks, Mr Blankfein said that the bank can "absolutely do a lot more on the cost side if we have to." "We take a particular and energetic look at continued cost cuts when revenues are stalled.... Necessity is the mother of invention," he said at a Credit Suisse financial services forum in Miami.
Despite reducing staff among its traders and bankers, Goldman has been forced to boost its workforce to deal with new regulatory requirements. The number of those employees rose 11 per cent from 2012 to 36,800 by the end of 2015, the bank said.
According to the informed source, Goldman's job axe will fall most sharply in its fixed-income products, such as bonds, currencies and commodities activities, where 10 per cent of the staff will lose their jobs.
Big banks have been under pressure to rein in budgets as the economic slowdown heightens worries about deteriorating credit quality, particularly as energy companies grapple with the sharp decline in oil and gas prices.
Bank stocks have sunk in recent weeks, with Goldman shares almost 18 per cent lower since the start of the year.