The News: Goldman Might Oust Dozens of Partners Late in 2010
Goldman Sachs looks to undergo a shake-up among senior non-executive ranks late this year, largely independent of any C-suite changes that might result from the bank's legal and public relations issues.
The bank is slated to elevate roughly 100 managing directors to the coveted status of "partner" MD, as it does every two years. Unlike in past years, this time around the process could lead to the ouster of "dozens" of current partners, the Financial Times reports.
The choice of partners is closely watched both inside and outside Goldman because those joining the highest rank in the bank's hierarchy command high pay packages and significant influence within the bank. This year the market will be watching to see whether Lloyd Blankfein, chief executive and a former trader, promotes more investment bankers in an effort to shift Goldman away from the trading businesses that caused its recent woes.
The bank's selection process for new partners typically includes an element of changing of the guard, in which some existing partners lose that title. When fewer partners than usual retire or leave the firm - as has been true over the past two years - there is pressure to demote more partners than usual to make room at the top.
Tradition at Goldman calls for selecting around 100 new partner while keeping the total numbers of partners at about 400. Last time around, 94 new partners were named in 2008.
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