Goldman partners face day of reckoning as exit door spins

5 min read
Americas, EMEA
Philip Scipio, Steve Slater

The pace of partners leaving Goldman Sachs is picking up one year into the reign of chief executive David Solomon, as senior staff exit the bank amid management shifts and pressure to step aside for fresh blood to come through.

Insiders said the pressure is being felt more acutely in the bank’s trading group, but there is a palpable squeeze being felt across the bank as Solomon thins upper management.

Co-head of securities Marty Chavez is the most high profile partner on his way out. Chavez, who a couple of years ago was seen as a potential Goldman CEO, will retire at the end of this year and be replaced in the role by Marc Nachmann, who has been co-head of the investment banking division for the past two years.

That and other senior changes are taking place shortly before Solomon announces a keenly anticipated strategic update early in 2020. As a result, the changes could be setting out Solomon’s key lieutenants to implement his plans.

But it also reflects that some believe the bank’s partnership ranks have become bloated.

Wells Fargo analyst Mike Mayo estimated the partnership ranks have grown by 15% during the last eight years, while revenues have fallen 6%.

Solomon may now be looking to cut that level back to that seen eight years ago - making the partner rank harder to achieve.

“If Solomon is not culling the ranks he certainly should be,” Mayo said. “But rather than making the partnership ranks smaller and more exclusive to boost the ‘aura of mystique’, it should be about the bottom line.”


The number of Goldman partners has been steadily rising, despite revenues declining and overall headcount at the bank remaining flat.

The bank’s revenue has been stagnant since 2010, only breaking out of a tight range last year.

“If you are a top performer, the avenue to partnership will be as open as it ever was,” Mayo said. “But if you are resting on your laurels as a senior partner whose best days are in the past, I’d watch out.”

Joining Chavez out the door is co-chief operating officer of global equities, Jeff Nedelman, who will also retire at the end of the year.

Nedelman has been at Goldman for 26 years. He was named as co-head of global equities in May alongside Michael Daffey and Phil Berlinski.

Goldman often has three managers running major groups, but it is expected that Nedelman will not be replaced and other areas will be reduced to a pair of co-heads.

Goldman chief information officer Elisha Wiesel and head of research Steven Strongin are also headed towards the exit this year, as are a number of other partners.

After the last class of partners was added in November 2018 the ranks swelled to 484.

But before the year is out as much as 15% of those 484 are expected to be retired. Not all analysts think that is good news.

“The fact that the bank indicated that it’s firing 15% of its top executives is a sign of challenges in the organisation … consequently revenues are below where they were 10 years ago,” said Dick Bove, banking analyst at Odeon Capital Group.

Goldman’s business mix is also shifting, as Solomon focuses on retail banking, technology and expanding its reach into middle market activities. And those areas are not likely to create as many partnership opportunities as trading or investment banking have in the past.


Nachmann, 49, looks to be a winner in the latest changes. He will relocate from London to New York and join Ashok Varadhan and Jim Esposito to co-head securities.

Nachmann has been at Goldman for 25 years and his experience in investment banking and running debt and equity capital markets and financing will be significant. Goldman is attempting to expand its trading business with corporate clients and increase its financing capabilities, according to an email to staff seen by IFR.

Chavez, 55, has spent 19 years at Goldman across senior roles spanning technology, finance and trading. He will become a senior director once he retires, which will see him retain a relationship with Goldman.

Chavez first joined Goldman in 1993 in J Aron’s currency and commodities division, and after rejoining the bank in 2005 he was appointed chief information officer in 2013 and chief financial officer in 2017, before moving to securities co-head in November 2018.