Reports of 2 high-profile Goldman Sachs' partners exiting the firm as more layoffs are seen on the horizon
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- News broke Tuesday of two high-profile Goldman Sachs partners leaving the bank.
- Fred Baba is one of Goldman's youngest partners at 34 years old.
- Dina Powell McCormick, a former government official, is one of the most senior women at the bank.
It hasn't been smooth sailing at Goldman Sachs in recent months. Navigating a shift in strategy, amid a larger dealmaking drought, have led some senior employees to go as far as considering complaining to the board about CEO David Solomon.
As if all that wasn't enough, the leadership at Goldman Sachs had another cross to bear on Tuesday: news breaking of two of its high-profile partners exiting the bank.
Fred Baba, one of Goldman's youngest partners, and Dina Powell McCormick, a former government official who ran the bank's sovereign business and sustainability efforts, are both reportedly leaving the firm.
Baba, whose exit was first reported by Bloomberg, was viewed as one to watch at the firm and across Wall Street as he rose the ranks within the bank's rates business. (In fact, he made our annual list of rising stars on Wall Street in 2020.)
The 34-year-old's impact, though, was felt beyond trading, as Baba gained a public following after writing an internal memo that went viral about his experience being Black in the wake of the murder of George Floyd.
Now, a little more than six months after reaching partner status, Baba is headed for the door and reportedly fielding offers from rival non-bank trading firms, including Jane Street, per Bloomberg.
Powell McCormick, whose departure was first reported by The Wall Street Journal, has been at Goldman since 2007, save for a brief stint working under President Donald Trump as a deputy national security advisor for strategy. She's joining up with another pair of Goldman alums in Byron Trott and Gregg Lemkau at BDT & MSD Partners where she'll serve as vice chairman and president of global client services.
The exits come amidst a difficult few months for Goldman Sachs, which has seen a change in strategy, a reorg, disappointment over bonuses, and layoffs.
And the pain isn't over, as another round of layoffs could be coming to the bank as soon as in the next few weeks, per The Wall Street Journal. The ax is expected to fall on a range of employees, including managing directors and other senior executives, the Journal reported, citing people familiar with the matter.
Partner departures, meanwhile, are to be expected, and for a time were welcomed as CEO David Solomon looked to shrink the group in order to bring back some of its prestige.
But Baba's exit shortly after being welcomed into the exclusive group seems surprising, especially given how well trading broadly has done for Goldman. Add in the fact that he could land at a firm like Jane Street that has competed, and beat, Goldman at its own game and you start to see why him leaving might turn heads.
Powell McCormick's departure, meanwhile, is demonstrative of how former partners can become a thorn in the bank's side by scooping up top talent from Goldman after they leave.
Which begs the question: Has Goldman Sachs' partnership lost some of its luster?
As recently as five years ago, a freshly minted partner exiting the bank would have been somewhat unheard of. But nowadays, as Goldman looks to right the ship amid a dealmaking drought, it might not seem as drastic of a move.
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