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Goldman's (GS) CEO Blankfein's Pay Raised by 9% in 2017

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The Goldman Sachs Group, Inc.GS chairman and chief executive officer (CEO) - Lloyd Blankfein - received about 9% pay hike in his total compensation package. His annual salary has been increased to $24 million in 2017 from $22 million in 2016, according to a Securities and Exchange Commission (SEC) filing last week.

The CEO's pay package includes a base salary of $2 million and annual variable compensation of $22 million for 2017. Notably, 80% of his annual variable compensation consists of performance-based restricted stock units or "PSUs", while the remaining is in the form of cash.

The hike, as believed, is well deserved keeping in mind Blankfein's contribution to Goldman, when he took over the reins of the company in 2006. He has been instrumental in boosting pre-tax earnings by 8% to $11.1 billion in 2017. Moreover, the company reported revenues of $32.1 billion, which improved 5% year over year, despite challenging market-making business environment.

Besides Goldman's strong operating performance in the year, the CEO's announced $5-billion growth plan was also a tailwind. All positive factors have caused investors to become optimistic about this banking giant's long-term prospects. Notably, the company's share price appreciated roughly 6.4% in 2017 compared with 19.5% growth registered by the industry .

Among other banking giants, Bank of America Corp.'s BAC chairman as well as CEO - Brian Moynihan - is expected to receive $23 million as total compensation for 2017, which reflects a rise of 15% year over year. Among others, JPMorgan JPM and Morgan Stanley MS also increased their CEOs' compensation.

Blankfein has also been adept in strategically evaluating the various facets of Goldman's major businesses. Besides announcing numerous cost-cutting initiatives and divestment of non-core units, the CEO has single-handedly revived profitability at the bank by handling several legal settlements.

We believe Blankfein's pay hike will prove to be a major morale booster. Goldman's fundamentals remain highly promising with a diverse business model and a solid balance sheet.

Goldman currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here .

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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