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Business News

Goldman bankers' £8bn bonus after bumper year

Goldman Sachs is likely to revive the controversy over excessive bonuses as it kicks off the banking results season this week by announcing total pay awards for its staff totalling more than £8bn.

The investment bank is forecast to report on Wednesday that profits jumped to about $6.3bn (£3.9bn) last year, from $4.44bn in 2011, helped by strengthening revenues from bond and share trading.

Analysts expect Goldman to pay its staff a total of between $13.3bn, or £8.2 bn, and $13.8bn in compensation for the year – the bulk of it in the form of bonuses. This compares with $12.2bn in 2011 and equates to an average of about £250,000 for each member of Goldman Sachs' staff, up from £230,000 the year before. The roughly 5,000 staff Goldman Sachs employs in the City will find out their share of the total pot later this month.

Over at JPMorgan, one of Goldman's biggest rivals, which also announces its results on Wednesday, bonuses are expected to fall. This is because profits at the bank are forecast to be down – largely because of trades made in the London office by a trader nicknamed the Whale, which lost the company £3.85bn.

However, although JPMorgan's bonus pool is expected to decline, its 26,000 investment bankers are thought to have received an average of about £186,000 last year.