Goldman Sachs CEO David Solomon says he would not acknowledge ‘caricature’ that critics have painted of him

Regardless of what he reads within the press, Solomon mentioned he’s all the time reflecting on his management and methods to enhance within the job.

The criticisms from Goldman Sachs
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staff — principally unnamed sources — got here through a sequence of articles beginning with the Wall Street Journal that highlighted complaints from former CEO Lloyd Blankfein and others.

Solomon mentioned it’s “no fun” seeing the non-public assaults and speculated that a few of it could be from the truth that Goldman did very effectively for its companions in 2021, however earnings fell in 2022.

The financial institution’s “significant” strategic selections to create three divisions in a transfer that eradicated hundreds of jobs additionally created some “noise” round his management, Solomon mentioned.

But previous CEOs have additionally been criticized when the agency has developed, comparable to when it mixed its equities and fixed-income buying and selling companies below one division, he mentioned.

Another criticism within the articles was that Solomon’s pastime as a disc jockey was distracting him from his job.

Solomon informed CNBC’s Faber that he’s not spending time as a DJ and that his sole focus is Goldman Sachs.

While 200 companions have left the agency lately, Solomon mentioned the turnover price has not modified from its historic previous because it always refreshes its secure of 400 companions.

With Goldman Sachs as a lead underwriter of subsequent week’s blockbuster preliminary public providing from chip maker Arm Holdings Ltd., Solomon mentioned the moribund marketplace for IPOs could quickly choose up steam.

“I feel better about capital markets,” Solomon mentioned. “Over the next few months, with Arm and other IPOs — if they go well you’ll see a meaningful increase in activity.”

Overall enterprise confidence from executives has additionally improved over final 12 months, with an uptick in M&A from roughly 10-year lows anticipated this 12 months, he mentioned.

Goldman Sachs plans to hitch different banks in pushing again towards stricter capital necessities being proposed by the U.S. Federal Reserve and the FDIC for banks as a part of the implementation of worldwide Basel III necessities put in place after the worldwide monetary disaster.

“We think these new capital rules have gone too far and will hurt economic growth without materially increasing safety and soundness,” Solomon mentioned. “Banks are expressing that view. There will be debate around this.”

Solomon has drawn criticism on a variety of points, from canceling “summer Fridays” on the financial institution to Goldman’s expensive retreat from the consumer-banking enterprise.

The financial institution additionally faces a Justice Department inquiry into Goldman’s position as each a banker and acquirer of Silicon Valley Bank securities within the interval main as much as that financial institution’s collapse in March.

Also learn: Goldman Sachs nonetheless a purchase, financial institution analyst says, regardless of noise round CEO David Solomon

Over the summer time, Goldman introduced the return of veteran Russell Horwitz as chief of employees and the departure of two different executives. Horwitz was referred to as “Mr. Fix-It” at Goldman throughout the monetary disaster of 2008-’09.

Solomon additionally introduced ally Tom Montag onto the board a couple of weeks in the past.

In June, the Wall Street Journal reported on criticism of Solomon from a few of the agency’s 400 companions and Blankfein over the financial institution’s retreat from shopper banking.

As of early this 12 months, Goldman is now organized into three main models: Global Banking & Markets, Asset & Wealth Management and Platform Solutions. Previously, it reported 4 models:  Investment Banking, Global Markets, Asset Management and Consumer & Wealth Management.

The adjustments have resulted in hundreds of layoffs at Goldman Sachs, in addition to about $3 billion in losses in its platform options unit since 2020.

Goldman can also be reportedly near promoting its GreenSky shopper lending unit.

On the plus aspect, Solomon has signaled {that a} multi-year trough in deal-making this 12 months would quickly finish.

Goldman Sachs inventory is down 6.2% in 2023, in comparison with a 4.1% achieve by the Dow Jones Industrial Average
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and a 15.9% rise from the S&P 500
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JPMorgan Chase & Co.
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is up by 7.1% this 12 months, whereas Morgan Stanley
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is down 1.1% in 2023.

Wells Fargo & Co.
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inventory is off by 2.2%, whereas Citigroup Inc.
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is down 9.9% and Bank of America Corp.
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is down by 15%.

Also learn: Dealmakers predict M&A trough in private-market offers could easy out in coming months