Goldman Sachs pay check controversy

Financial results from US
investment bank Goldman Sachs reveal that the average employee was paid $430,000
last year, despite a slump in profits.

The figure represents both salary
and bonuses and is $59,000 – around 12 per cent – lower than in 2009.

However, net profits for 2010 –
although totalling $8.3 billion – were 38 per cent lower than the previous 12
months.

An equivalent decrease in pay would
have meant staff took home just under $303,000 on average.

Net profits for the final quarter
were $2.2 billion, while the total remuneration pot for last year stood at $15
billion.

Goldman Sachs is the third major
player to report so far in the US bank reporting season.

JP Morgan announced a 48 per cent
boost to profits in 2010, before Citigroup followed with a dismal announcement
which led to stock dropping 7 per cent.

Goldman Sachs is one of nine US
banks to have received a cash bailout from the US taxpayer.

The news comes as the argument over
bankers’ bonuses rages on in both the UK and the US.

The public have been frustrated at
the size of bonus payouts, while the banks argue they will lose their best
staff to rivals if they are not sufficiently rewarded.

Reacting to the figures, TUC
General Secretary Brendan Barber said: “Goldman Sachs has stuck two
fingers up to austerity Britain by shelling out mega bonuses again.

“These earnings would make
Gordon Gekko blush.

“Bankers are toasting their
telephone-digit bonuses while the rest of the country reels from more than a
fifth of young people being out of work.

“Looking ahead, we are seeing
signs of growth and more economic activity and we are well-positioned to help
our clients expand their businesses, manage their risks and invest in the
future.”

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