Goldman Sachs named David Solomon its new chief executive Tuesday, implementing a much-telegraphed succession plan as it expands beyond its Wall Street roots to the broader consumer market. The prestigious investment bank said Solomon will assume the top executive job on October 1, succeeding longtime chief Lloyd Blankfein, who will remain as chairman through the end of the year. Solomon will then succeed Blankfein as chairman. The succession comes as Goldman expands efforts aimed at Main Street customers through online banking and other newer ventures such as credit cards, even as the bulk of revenues continues to come from legacy businesses such as merger and acquisition advising.
Part of the reason for Goldman’s shift has been the tighter regulatory environment on banking in the wake of the 2008 financial crisis that has curtailed some riskier activities. With Blankfein’s departure, JPMorgan Chase’s Jamie Dimon is the last remaining chief executive from a big Wall Street bank from that period. “Our firm has demonstrated great resiliency and strength over the last 12 years,” Blankfein said in a statement. “David is the right person to lead Goldman Sachs. 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.”
Goldman’s announcement came as the bank reported a 44 percent jump in second-quarter earnings to $2.3 billion earlier Tuesday thanks largely to strong revenues in advising clients on mergers, initial public offerings and other transactions. The announcement was expected after Solomon’s main rival for the top job, former co-president Harvey Schwartz, retired in March, leaving Solomon as the last remaining candidate.