Goldman Sachs' CEO-in-waiting mentioned two words at least 70 times, and it shows how the bank is trying to change its narrative
- Goldman Sachs president David Solomon presented to investors publicly on Thursday for the first time since being named the presumptive replacement for current CEO Lloyd Blankfein.
- Solomon started - and ended - his presentation highlighting Goldman's commitment to clients and relationship building, signaling his attempts to convince the market that the firm is shifting its approach to trading.
- Solomon said the word "client" at least 57 times, and "relationship" got an additional 13 mentions.
David Solomon has a message for all the Goldman Sachs clients out there: he's thinking of you.
The Goldman president, who spoke publicly to investors on Thursday for the first time since being named the heir apparent to current CEO Lloyd Blankfein, did his best to convince the market that the bank is laser-focused on helping its clients solve problems, not on padding its own bottom line.
"Allow me to start just by saying that when we think about strategy at Goldman Sachs, we think about clients," Solomon said at the beginning of remarks given at an investor conference hosted by Sanford C. Bernstein in New York. "Clients are at the center of everything that we do."
Solomon, who beat out colleague Harvey Schwartz for the No. 2 spot, rose through the investment banking business with a reputation for being Goldman's point man on many key client relationships including 3M, Disney's Bob Iger and casino mogul Sheldon Adelson. Solomon is known for pushing his investment bankers hard in the service of clients.
The remarks represent a shift in strategy as Solomon makes his mark on the firm. Solomon may try to take a more customer-friendly approach to the sales and trading business, which has been known historically for preferring complex, more episodic transactions that command higher fees rather than more vanilla-products that are lower margin. Some market participants still believe that Goldman won't miss an opportunity to make as much money as it can at the expense of clients, a reputation it developed during the financial crisis that it has been trying to change.
In 2017, after the securities division turned in a first quarter performance that was its worst performance in more than a decade, trading chief Pablo Salame implored his workers to spend more time serving clients and less time being slaves to the profitability of each trade.
"We're focused on this evolving business and making sure we're positioned as well as we can be," Solomon said Thursday. "Our business, historically in fixed income, had been focused around the bespoke structured solutions and derivative transactions. There's clearly been an evolution here in the near term to much more cash business, flow business, and electronic platforms."
To grab market share from commercial banks like JPMorgan or Citigroup will mean convincing clients that Goldman has their best interests at heart.
If clients were listening, they need only to count the number of times Solomon mentioned them by name in his presentation. The word "client" appeared at least 57 times in his remarks. He added "relationship," as in relationship-based business, an additional 13 times.
In case the message didn't come through, Solomon returned to the topic one final time as he wrapped up prepared remarks.
"I'd like to finish the formal part of my presentation with where I began," Solomon said. "Clients are the center of everything we do at Goldman Sachs."