Even the most sought-after and prestigious investment bank in the business sometimes has to retool its strategy to stay profitable.
Goldman Sachs, which had originally planned to eliminate 1,000 positions in 2011, ended up shedding 2,400, according to its fourth quarter earnings statement. The firm axed 900 positions in the fourth quarter alone as part of its plan to trim $1.2 billion in expenses. Fifty partners left the firm last year, some at the urging of the company and others of their own volition.
Headcount now stands at 33,300, down 7% from 35,700 at the end of 2010.
Now, the firm intends to keep cutting until it reaches $1.4 billion in savings, Chief Financial Officer David Viniar said on the earnings call this morning. While most of those savings were achieved in 2011, there's still a bit more cutting to be done in 2012, which means the firm will "make further adjustments if necessary," Viniar said.
"We cut headcount last year and we tried to be disciplined on expenses," he said.
In response to a question on whether the firm will reduce the size of its fixed income, currency and commodities unit, Viniar said, "We'll try to balance the strength of the franchise and the global opportunity set with the current environment and make sure we're sized appropriately."
Headcount reductions took place across all levels in 2011, he added.
The firm paid employees an average of $367,057 for 2011, down 15% from 2010, when it shelled out $430,700 per employee.
Goldman reported earnings of $1.01 billion in the fourth quarter, down from $2.4 billion in the year earlier period. For the full year, profits shrank 47% to $4.4 billion.
Write to Julie Steinberg at Julie.Steinberg@dowjones.com
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