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Morning Coffee: How much you really earn after 7 years in trading at Goldman. Why you won’t work for Blackstone

Application ratio at Blackrock

The queue to get into Blackrock

How much can you really earn after seven years at Goldman Sachs? The case of Goldman Sachs executive director Sonia Pereiro-Mendez offers a glimpse into the reality of Goldman’s pay structure.

Pereiro-Mendez, a distressed debt trader, is suing Goldman for maternity and sex discrimination and claiming millions of pounds in compensation. Documents concerning her pay have been made available ahead of the court case, which starts tomorrow. The Financial Times reports that seven years after joining Goldman, in 2011, Pereiro-Mendez’s salary was set at £250k, supplemented by a £200k bonus. However, Pereiro-Mendez is arguing that she should have been paid £910k because ‘an employee in her position would normally receive a bonus equivalent to 5% of the profit they bring in to the bank.’

In retaliation, Goldman is claiming that Pereiro-Mendez ranked in the lowest 10% of performers in 2011 and isn’t deserving of the additional compensation she says is her due. Interestingly, this suggests that even the lowest performing traders on Goldman’s distressed debt team can expect to earn £450k ($673k) a year….

Separately, if you thought getting into Goldman Sachs is hard, getting into Blackstone is worse. In 2014, 3% of juniors applying to Goldman achieved a job offer. In 2014, 0.7% of juniors applying to Blackstone did. There were 15,000 applications for 100 analyst jobs. “It’s six times harder to get a job as an analyst at Blackstone than getting into Harvard, Yale or Stanford,” said Blackstone co-founder Steve Schwarzman last week. 

Meanwhile:

‘During her maternity leave she [Pereiro-Mendez] continued to bring in business for the bank and on one occasion arranged for her in-laws to look after her baby in a car park so that she could breastfeed during breaks from the meeting,’ (Sunday Times) 

Deutsche Bank is considering two strategic scenarios. Under the 1st, it will sell Postbank and cut investment banking assets by a fifth. Under the 2nd, it will split itself into two entities (one containing investment banking, asset and wealth management and global transaction banking and one comprising all retail businesses). The 1st is most likely. (Financial Times)

Deutsche Bank is weighing a third option of making deep cuts to consumer banking and to investment banking. But this is increasingly unlikely. (Bloomberg) 

The worst thing about no Bloomberg: “What I miss is the instant Bloomberg chats, which I rate higher than trading or data feeds.” (NYTimes) 

City initiation rituals: “At my last firm it was a trifle – we ate trifle with our hands tied behind our backs.” (Telegraph) 

Half the graduates interviewed for the FT’s graduate programme confessed they hadn’t read the paper that day. (Financial Times)  

“One to two percent of the population can survive on four hours of sleep a night.” For the rest, less than 7 hours leads to a reduction in IQ. (CNN) 

Etiquette: you shouldn’t really email someone you can see. (Telegraph) 

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