Blankfein

NEW YORK, United States (AP):

John Mack's record for the biggest bonus ever paid to a Wall Street CEO didn't last even a week.

It was smashed by the US$53.4 million (J$3.52 billion) that Goldman Sachs gave its chief executive, Lloyd Blankfein.

The bonanza for Blankfein included a cash bonus of US$27.3 million, with the rest paid in stock and options.

He took the helm of the investment bank in June after United States president George W. Bush nominated Henry Paulson to be Treasury Secretary.

The record payday, disclosed by Goldman Sachs Group Inc., in a filing with the Securities and Exchange Commission on Tuesday, breaks the one set just last Thursday when Morgan Stanley disclosed that it paid CEO Mack US$40 million (J$2.64b) in stock and options.

Other than Blankfein, 11 other senior Goldman executives as a group were granted slightly more than US$150 million in shares and stock options.

The highest paid among those were Gary Cohn and Jon Winkelried, who both hold the titles of president and chief operating officer. They each received US$25.6 million in shares and options in 2006.

Any cash bonuses for the other executives were not mentioned in the filings.

The bonuses come after Goldman reported last week that it had earned the highest yearly profit in the history of Wall Street.

Net profit rose 70 per cent to US$9.4 billion on revenue of $37.67 billion. Goldman and other firms have benefited from a surging market for takeovers and a strong stock market.

Goldman said last week it had set aside a total of US$16.5 billion this year for salaries, bonuses and benefits. On average, this would translate to US$622,000 per employee.

The bonuses come in a year in which Goldman shareholders have benefited from a rise of about 58 per cent in the company's share price, the strongest returns of any Wall Street investment house.

Lehman Brothers Holdings Inc. and Bear Stearns Cos. have said they would pay about US$12 billion in compensation each. Lehman said last week it paid its chief executive, Richard Fuld, US$10.9 million in stock this year.

The trend in compensating executives has been to keep salaries level while increasing bonuses.

The highest-paid executives in the country earned 48.2 per cent more in bonuses and 31.2 per cent more in cash, according to the Executive Compensation Index done by ERI Economic Research Institute and CareerJournal.com as of last month, in a comparison of year-over-year numbers.

In the same period, salaries fell by 0.31 per cent.