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Goldman Sachs is investigating the cost of private jet trips enjoyed by CEO David Solomon and other senior executives as part of a major cost-cutting review, the banking giant confirmed Wednesday.
The use of two Goldman-owned Gulfstream private jets is “one of the more sensitive issues” facing a budget review led by the bank’s chief executive officer, Erica Leslie, the Financial Times reported, citing sources familiar with the matter.
The cost review comes as Goldman Sachs prepares to cut about 3,200 jobs this week – a move to shore up the bank’s strained finances despite falling earnings and a worsening recession.
“We’re looking at costs across every aspect of the organization, so it’s ridiculous to focus on any one department or line,” a Goldman Sachs spokesperson told the Post.
The bank is scrambling to cut costs as it seeks to address profitability problems in its shrinking investment banking business and struggling margins in its money-losing consumer banking unit. In addition to the use of private jets, Goldman is investigating travel expenses for all bankers, conferences and vendors, according to the report.
According to The Post, Goldman Sachs ended its free coffee perk in 11Thfloor “Sky Lobby” as part of the cost-cutting push.
Frustrated bankers have called the layoffs, the most widespread since the Great Depression, “David’s Day.”
Goldman is expected to cut annual bonus payments by as much as 40%.
Under Solomon’s leadership, Goldman Sachs purchased two Gulfstream jets in 2020 to facilitate client meetings and other business trips for top brass. At the time, the bank said the planes, which cost tens of millions of dollars each, would be more cost-effective than the previous arrangement of charter service NetJets.
But Solomon has been using his private jets for his own personal gain, and in recent years has been reported to have ranked Goldman Sachs under his belt.
In the year In 2021, Bloomberg reported that the jet-setting CEO — who moonlights as a DJ — used Gulfstreams for several trips to the Bahamas and the Hamptons. At one point, the outlet said, Solomon arranged seven trips over several weekends in Goldman-owned planes.
In a company filing, Goldman explained that its internal policy is to “restrict the personal use of its private jets” and that “total increases are required to recoup our costs.”
In October, Goldman announced a major internal restructuring in which its investment banking and trading activities were merged into one division and Marcus was folded into its asset and wealth management division.
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