Goldman Sachs, the Smartest Theives in the Room, Forced to Up Bonuses or Lose Barbarians

[Elmore Furth]

Who said there isn't honor among theives?

Goldman Sachs, the US investment bank, has handed every partner in its London office a one-off award of shares to compensate them for the unusually small bonuses they received last year.

The hand-outs, thought to be worth millions of pounds, follow mounting concern at the bank that it was losing staff because of the awards it made for the 2009 year, which were capped at a £1m per partner as part of Goldman's strategy for dealing with the one-off tax on bank bonuses implemented by the last government.

Since then, at least four Goldman partners in London have quit the bank for new roles amid complaints that their bonuses would have been much more generous had they worked for rivals. It is understood that Goldman felt compelled to make last month's awards in order to avoid further staff losses.

Mr Darling, who was then chancellor, said his tax – a 50 per cent charge to be paid by the banks on all bonuses worth more than £25,000 – was intended to discourage the sector from making large payments, in the face of mounting public anger at the City. As it turned out, many banks felt obliged to pay their staff generous bonuses anyway; the Treasury subsequently revealed its take from the levy had been around £3.5bn. Of that, Goldman contributed around £380m, despite the caps it placed on payouts to partners.

New share windfalls for Goldman Sachs partners

[aquart]

1. Idiots.

[Initech]

2. Reverse Robin-Hoods