Goldman Sachs CEO David Solomon's growth strategy gains board's support: Report

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Goldman Sachs CEO David Solomon has revealed that the company's board of directors is in favour of Solomon's emphasis on the bank's core Wall Street operations and asset management. As reported by Reuters citing sources, Solomon has been entrusted with the responsibility of revitalizing the bank's stock value, despite facing doubts from certain investors and employees. According to one of the sources, the 12-member board is closely engaged with Solomon's revamped strategy, particularly because Goldman Sachs incurred losses and fell behind its competitor, Morgan Stanley, due to its venture into consumer banking.

Insiders have revealed that the potential addition of Tom Montag, who has been approached by CEO David Solomon, serves as a signal that both Solomon and his turnaround strategies have internal backing from top-level executives. This assessment, which emerged after Goldman Sachs' recent board meeting in India, has not been previously disclosed. It indicates that those surrounding Solomon have confidence in his capability to revitalize the bank's fortunes.

The bank's shares have fallen about 2% in 2023, lagging competitors Morgan Stanley and JPMorgan Chase where shares have risen 8% and 15%, respectively. Even so, Goldman's stock is still outperforming the S&P banks index, which is down more than 3% this year. Goldman is trading at a forward price-to-book multiple of 0.99 times compared to JPMorgan, which trades at 1.43 times and Morgan Stanley's 1.53 times, according to Refinitiv's Eikon data.