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Goldman's board weighs handing David Solomon's job to John Waldron by early 2028
Goldman Sachs' board has discussed COO John Waldron replacing CEO David Solomon around the end of next year or early 2028, the Wall Street Journal reported. He helped build the strategy he would inherit, though Semafor expects any real change to come on his watch.
The Investor · Invest desk
What happened
- Waldron has followed Solomon since the 1990s, from Bear Stearns to Goldman, and has held the heir-apparent title for all of Solomon's tenure, according to Semafor.
- Goldman offered Waldron $80 million last year to keep him at the firm.
- Goldman folded its Marcus consumer bank into asset and wealth management in 2022, then disclosed in 2023 that the area had lost $3 billion since the end of 2020.
- Reuters credits Waldron with creating OneGS 3.0, Goldman's AI transformation program.
- Goldman's share price has quadrupled since Solomon became chief executive, according to Semafor.
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Why it matters
- decision Solomon's remaining time in the job is his window for the big deal Semafor has long expected him to want, and an acquisition of that size before the handover would change the bank Waldron inherits.
- constraint The likely successor listened to internal critics of consumer lending, so a return to retail banking looks unlikely and Goldman's next growth money points to its core businesses and automation.
- contradiction The Daily Upside expects a Waldron era to extend Solomon's core-business strategy, while Semafor expects any transformation to be his, so settling who leads leaves open what the bank does next.
Apollo offered Waldron $500 million and a write-your-own-ticket role in 2024, according to Semafor, and he turned it down [5]. Set against Goldman's retention award [4], the rival bid was 6.25 times larger [1]. A banker might decline a gap that size out of loyalty, or rather, because he has been promised something worth more. Semafor's columnist took the second view, writing that the refusal was "not something one does without assurances" [6]. If that is right, the board is now setting the date for a choice it had already signalled by 2024.
The date itself is soft. The Journal's account, as relayed by The Daily Upside, cites people familiar with the matter and describes a board discussion [1]. Goldman has lost heirs in this position before. John Thain and John Thornton never succeeded Hank Paulson, and Gary Cohn tired of waiting under Lloyd Blankfein [11]. When Solomon became chief executive, he gave Waldron the firm's second-most important job [3].
The case for continuity rests on the consumer losses. Goldman also paid a $65 million Consumer Financial Protection Bureau penalty over disputes on the credit cards it issued with Apple [8]. According to the Journal, Waldron was a sounding board for leaders and partners who doubted the consumer foray [10]. He also worked with Solomon on a strategy anchored in global banking, markets and asset management [9]. Client assets in the management division have reached $1.9 trillion, per the latest annual report [18]. The Daily Upside expects the move away from consumer toward those core businesses to continue under him [19].
Semafor's column makes the opposite case. "The transformation, if it comes, will be Waldron's," the columnist wrote [14], describing a 56-year-old dealmaker who has staked out ground on AI and China [15]. Earlier this year Waldron told CNBC that the firm is "a human assembly line" that will become more digitized [17]. The same column holds that Solomon, unless he strikes the big deal many have assumed he wants, will be remembered as a stabilizing, corporatizing leader [13].
The sources leave room for three outcomes. Waldron could take over on the loose schedule with the strategy intact. Solomon could do a large acquisition first [13]. Or the date could slip, as earlier Goldman successions did [11]. I think the first is the likeliest on strategy, because the heir helped design what he would inherit [9]. I'd expect change under him to show up first as automation spending, with new businesses later if at all. A large deal before the handover, or Waldron adding a business outside banking, markets and asset management, would prove that wrong.
What to watch
- Whether Goldman's board formally announces the timetable with a named date for the handover.
- Any board role Solomon keeps after stepping down, and how much room it leaves Waldron.
- Goldman moves in China, one of the two areas Semafor says Waldron has staked out as his own.