Michael Sherwood Of Goldman Sachs
Strikes Gold

Goldman Sachs did not face any cash crunch problems as it rewarded one of its joint director Michael Sherwood with a 23.4 million dollar payout package, which was an increase by 10 million dollars over the previous year even as the banks profits soared upwards in spite of the credit crunch disease that had afflicted most of the other banks and other institutions across the UK. Goldman Sachs GSI, representing the banks operations in the Middle East, Africa and Europe reported an impressive 2.74 billion dollar pre-tax profit in the current year, which is around 4 times more than the 596 million dollars that the company had posted in the previous year.

A total of 10 directors got a share in the booty totaling 47.7 million dollars out of which Michael Sherwood bagged almost half of that amount. The other half could have been shared by other directors of the company such as Richard Gnodde, who is a co-director with Michael Sherwood, another director Yoel Zaoui, the head of investment banking and the chairman of Goldman Sachs, Peter Sutherland, who is also the chairman of BP. Mr. Sherwood was born in North London and is the joint director of Goldman Sachs International and was the ex-managing director of Watford football club. The company has defended to reward its top brass by commenting that their ability to compete efficiently in the business depended on their ability to draw in new employees and to motivate and hold on to their current employees. It further stated that performance was largely dependent on the talents and efforts of highly skilled individuals.

The top salary package paid by any UK bank might still have gone to Barclay's chief Bob Diamond, who got a total of around 36 million pounds spread among cash, shares and bonus incentives even though the bank had made hardly any additional profit as compared to 2006 and had to write off almost 2.8 billion pounds due to the US sub prime crisis. Since the entire extent of Goldman Sachs reports was not declared, there are chances that the top directors including Mr. Sherwood too could have received similar bonus packages. Goldman Sachs chief executive Lloyd Blankfein too got rewarded with a 53.9 million dollar payout along with stocks worth 45.7 million dollars. The company's report also mentioned competition from factors other than the financial services industry, like hedge funds, venture capital and private equity funds. It also had to compete in emerging markets where there was a presence of entities with much more experience. These payments to the top executives were made over a period of 53 weeks up to November end in 2007 and during this period their trading profit increased from 7 billion dollars to 10 billion dollars while profits rose from 596 million dollars to 2 billion dollars. The Goldman Sachs report, which was filed in the Companies house also mentioned that directors were also eligible to receive emoluments for other non-qualifying services and that they were not liable to disclose those details. It also mentioned that some directors also received the option of shares from the parent company, which was located outside of the UK.

So, top bankers in most banking firms have seen a good year and in spite of some banks writing off some of their profits down the sub prime drain, the personal rewards to these individuals has not only been maintained but in most cases has risen considerably. This move has angered many investors who have seen their share prices drop down drastically, some registering a drop of almost 40% but this does not seem to affect the banks board as they pat each others backs and laugh all the way to the bank.

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Article written by: Craig Parker - Make Money Expert