In the next few days Goldman Sachs is due to reveal the true dimensions of its bonuses. Will they live up to expectations?
Goldman will report its 4Q results next Tuesday, and is expected to disclose bonus numbers to MDs later this week and to junior staff early next week.
Although the firm's profits rose 30% in the first nine months of this year, the Telegraph predicts bonuses won't share that lustre.
It says total comp at Goldman will be up 10% in 2007 on 2006, but that additional headcount means the average employee is expected to see a 7% drop in his/her allocation to (a mere) 293k.
Headhunters offer widely divergent predictions on Goldman's payouts. "The general noise is that the average will be up 10-20%," says the chief exec of one esteemed boutique. "And the stars will be up 30% on last year."
The head of another niche search boutique sides with the Telegraph and says flat to down is the order of the day: "Goldman have a bigger pot, but it needs to be shared between more people," he explains. "Overall it's 5-6% down."
He adds that while star performers in areas like principal investments and prop trading are likely to be paid up substantially (expectations are apparently for increases of as much as 40%), others at the firm are going to be paid down to accommodate this.
At the same time, rivals are in no position to reward staff generously this year, removing the need for Goldman to pay up to prevent poaching. "It takes a lot for someone to leave Goldman," says the headhunter. "They are very aware of this - the retention premium in bonuses will be removed."
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