Bonus Shock: Goldman CEO Gets Just $9M

Feb. 6, 2010— -- Rumors were that when Goldman Sachs CEO Lloyd Blankfein's bonus was announced, it would be the bonus to beat all bonuses.

The Times of London reported Blankfein's bonus could reach $100 million. Wall Street waited with bated breath.

The final number: $9 million, but not in cash -- in company stock that can't be sold for five years.

That's what Blankfein received in bonus compensation for last year's record profits -- a number that was far below even the most conservative estimates.

The number was so low that for once the buzz isn't about Goldman's out-sized compensation, but about how the board arrived at a figure that is almost half what the head of JP Morgan Chase, Jamie Dimon, was awarded. Dimon will receive $17 million.

Some are calling it a PR coup for the publicity-ravaged firm. Goldman has been the target of criticism, online vitriol, and popular wrath since it emerged that it made record profits after taking government bailout funds.

In a popular Rolling Stone article, the writer Matt Taibbi equated the securities giant to "a great vampire squid wrapped around the face of humanity, " hyperbole that led to more articles delving into conspiracy theories surrounding the secretive firm.

"The outrage is simplistic," says Michael Wolff of Vanity Fair, who has written about the firm. "I can tell you why they deserve to make 100 million, and why this should have a happy ending, but at the same time I can feel the visceral mania and outrage everyone feels. Have these guys no humility? Goldman would have lost everything were it not for us the taxpayer."

Wolff says a series of public missteps, including Blankfein's recalcitrant testimony before a committee charged with investigating the financial crisis, led the compensation board to reduce the chief officer's bonus.

Rose Orens of Compensation Advisory Partners says it was a wise step that may even make Goldman into a "role model" for other banks.

"They may have made a lot of money," says Orens. "But at the same time they are viewed as being contributors of the financial crisis, as well as beneficiaries."

In a further nod to government heat, the bonus payout to Blankfein and 29 other top executives will be wholly in stock that cannot be sold for five years and have clawback clauses.

But will it be enough to appease Main Street?

"This is not an act of generosity," Wolff says. "What he is doing is looking at this and saying if I forgo the vast amount of money I might have gotten here, I stand to make even more money in the future."

Public opinion is priceless these days.

But some people say Blankfein's compensation is justified.

"As far as I'm concerned, Goldman Sachs is doing better than all of their competitors," says Andy Pollack, a pension consultant in New York. "And the point of the bonus is it's supposed to be an incentive when you do well. He did well, he should get it."

Another New Yorker, Thomas Barnes says, "I think it's excessive, because I don't know one person who's really worth that much money in a year."