After more than 12 years as the chief executive officer and chairman at Goldman Sachs, Lloyd Blankfein is stepping down.
The firm announced Tuesday that Blankfein would retire at the end of September, making way for co-chief operating officer David Solomon to take on the roles of chairman and CEO.
“Our firm has demonstrated great resiliency and strength over the last 12 years,” Blankfein said in a statement announcing the news. “I’ve never been more optimistic about our ability to serve our clients effectively and generate industry-leading returns.”
Blankfein, 63, joined J. Aron & Co. in 1982, months after the commodities trading firm was acquired by Goldman. By 1997, he was co-head of the Goldman’s fixed income, currencies, and commodities (FICC) unit. From there, he worked his way up to chief operating officer before ultimately becoming CEO in June 2006.
That same year, Solomon was named co-head of the firm’s global investment banking division. He had first joined Goldman as a partner in 1999, according to the firm’s website.
“David is the right person to lead Goldman Sachs,” Blankfein said in a statement. “He has demonstrated a proven ability to build and grow businesses, identified creative ways to enhance our culture, and has put clients at the center of our strategy.”
[II Deep Dive: Lloyd Blankfein’s Big, Tricky, Game-Changing Bet]
Under Blankfein’s leadership, Goldman announced a plan to bring in an additional $5 billion in annual revenues by 2020. The plan, first detailed last September, partly entailed revamping the FICC division, which had been dragging down the firm’s overall revenues, profits, and valuation with its poor results. As part of the revamp, Goldman is aiming to shift the unit’s focus to include more corporate clients, as opposed to primarily hedge funds and active asset management firms.
The 2020 targets also included increasing the firm’s equities revenue and ramping up its consumer and corporate lending capabilities. Goldman’s consumer lending business, known as Marcus at the firm, has already grown significantly since its inception in 2016, when it was launched to offer loans to lower- and middle-income customers. However, the platform’s future success may depend on how long the current credit cycle lasts. Meanwhile, Goldman faces steep competition in the corporate lending space from JPMorgan Chase & Co. and Citigroup.
These strategic changes have come as rumors swirled around Goldman’s succession plan. The had firm disclosed in September 2015 that Blankfein had been diagnosed with lymphoma. (He has been in remission following chemotherapy.) Goldman then named Harvey Schwartz and Solomon as co-presidents and co-COOs in December 2016, increasing speculation that Blankfein would soon step down. Things came to a head in March, when the Wall Street Journal reported that Blankfein would step down by the year’s end. At the time, Goldman denied the reports.
Adebayo Ogunlesi, lead director of the board, said Tuesday’s announcement is the culmination of a multi-year succession planning process.
“We are confident that David will build off the firm’s strong financial, risk management, and franchise position,” Ogunlesi said in the firm’s statement. “His drive, focus on our clients, and effective management skills will be critical strengths as he charts the firm’s strategy in the years to come.”