Goldman Sachs fired several executives in its transaction banking unit after they violated the firm’s communications policy, the company said in a memo seen by Reuters on Wednesday. The company did not name the individuals in the memo or specify the broken policies. Hari Murthy, a partner and global head of transaction banking, was one of those who was fired. Philip Berlinski, the bank’s treasurer, will take over the day-to-day management of transaction banking alongside Akila Raman and Luc Teboul. Berlinski is also leading the financial technology and consumer business on an interim basis.
The departures follow a year when Goldman Sachs has struggled to grow its investment banking division. The bank’s clients are reducing their debt and are less likely to raise capital shortly, making it harder for Goldman to make money from those investments.
Investors have also been skeptical of the industry’s recent gyrations. Amid the turmoil in global markets, the industry’s overall revenue growth has declined from last year’s high.
As a result, many firms have trimmed expenses. The Goldman memo did not mention any specific cost-cutting efforts, but the company has been looking to reduce staffing levels in some areas.
The memo said several Goldman Sachs employees were moving to other parts of the firm. Some employees, including senior managers, are leaving to pursue other opportunities outside the firm, while others are retiring.
Goldman Sachs also announced a few executive appointments. The company named Tim O’Neill as its vice-chairman. According to the company, he will be responsible for communications, marketing, regulatory and government affairs, philanthropy, and other strategic initiatives. O’Neill joined the company in 1985 and became a partner in 1990.
Among the other promoted executives, Tucker York was named to lead Goldman’s private wealth management business. He will join the management committee alongside co-chief information officers George Lee and Marco Argenti. In addition, the company promoted Bentley de Beyer as its global head of human capital management.
In a separate memo, Goldman Sachs chief executive David Solomon sent a year-end voicemail to staff warning of a reduction in the firm’s headcount in the first half of January. The company did not comment on the memo or say whether the job cuts would affect employee compensation and bonus payments. Its annual bonuses are usually delivered in late January or February. The memo warned that the bank’s investment banking, commodities, and fixed-income businesses would be affected. The bank’s other divisions will not see any job cuts. The memo also cited the need to improve its risk oversight and compliance capabilities as a reason for cutting jobs in those divisions. The bank’s Asia operations will remain unaffected by the layoffs. The memo said the company also does not plan to change its strategy in China. It added that the bank’s Chinese investment banking team will continue to focus on core corporate clients.