Meredith Whitney, the analyst who cut her rating on Goldman Sachs Group Inc. last month, said the bank has lost some of its top-performing employees as executives left to start their own investment companies.
“Goldman’s lost a tremendous amount of talent going to set up their own hedge funds,” Whitney, founder of Meredith Whitney Advisory Group, said today in an interview on Bloomberg Radio. “It became a scary prospect of having the government determine what you make.”
The Federal Reserve said last month it will review the 28 largest banks to ensure pay doesn’t create incentives to make the kinds of risky investments that brought the financial system to the edge of collapse, prompting bailouts of firms including Bank of America Corp. and Citigroup Inc. Goldman Sachs Chief Executive Officer Lloyd Blankfein said in May the bank, the most profitable Wall Street firm in history, was having no more trouble than usual in retaining employees.
