The search is apparently on for the next leader of the iconic Wall Street firm Goldman Sachs.
CEO Lloyd Blankfein could step down as soon as the end of the year, The Wall Street Journal reported Friday, citing sources familiar with the situation. A power transition would likely be quick and the bank “isn’t looking beyond Goldman’s two co-presidents,” the report said, citing sources.
That puts presidents and co-chief operating officers David M. Solomon and Harvey M. Schwartz in the running to head up the bank. They were named to the executive positions in December 2016, following the departure of then-COO Gary Cohn to the Trump administration. Cohn said Tuesday he is resigning from his role as chief economic advisor to the White House.
Goldman declined to comment on the report; however, sources familiar told CNBC there is no timeline set for Blankfein’s exit and it could stretch into next year.
Cohn’s departure from the bank came as Blankfein was on his way to his 11th year as CEO. Blankfein joined Goldman in 2006 and once joked he would die at his desk there. But the bank’s once-mighty trading desks have struggled to return to their peak in 2009, when revenue from the business reached $33 billion.
Last year, Schwartz and Solomon presented a joint plan to move the bank forward and generate $5 billion in additional revenue, with a vision to boost lending and open for business in new locations such as Seattle and Atlanta.
Before becoming co-president, Solomon co-headed the investment banking division for a decade and joined Goldman as a partner in 1999, right before the firm’s initial public offering. Prior to that, he worked in junk bonds at Bear Stearns.
In contrast, former chief financial officer Schwartz spends more of his free time at the office, according to a New York Times article in late November.
“Over five hours of interviews for this article, the most revealing moment about his business psychology came when he described how he interviews job candidates: He asks them to try to sell him the Polycom speakerphone that sits on his desk,” the Times said.
Schwartz was Goldman’s chief financial officer for four years. He is a former nightclub bouncer and started out in finance after college. Schwartz eventually made his way to a job at J. Aron, the Goldman commodities unit that was also the launch pad for Blankfein’s career at the bank.
Looking at Goldman’s history of executives, it’s possible Solomon and Schwartz could lead the bank together after Blankfein leaves.
“There had always been a co-CEO model at Goldman Sachs before Lloyd Blankfein, so I’m not sure Goldman would go back to one CEO when he leaves,” said Ken Leon, bank analyst at CFRA. “I’d be surprised if the company picked one CEO when Blankfein leaves.”
Blankfein has not ruled out the possibility of Solomon and Schwartz taking the reins together.
“Goldman Sachs as a firm has a long tradition of co-CEOs,” Blankfein said in an interview with Bloomberg in late November. “That can work if it works and people get along, but it doesn’t necessarily have to work. So I would say that it’s not a guarantee.”
Jon Corzine and Hank Paulson shared the CEO title in the late 1990s. Corzine left in 1999, eventually becoming governor of New Jersey. Paulson would hang on as CEO until 2006, when he left to become treasury secretary for the Bush White House.