Feb 12 Goldman Sachs Group Inc Chief
Financial Officer Harvey Schwartz said on Tuesday that Wall
Street banks will have to produce higher returns for
shareholders, and may need to cut staff further in order to do
"The industry will migrate to higher returns because it will
have to," Schwartz said at a Credit Suisse conference in Miami,
adding that investment banks may do so by taking "excess
capacity" out of the industry.
Schwartz, who took over the CFO role at the end of last
month, declined to provide a specific return-on-equity target
for Goldman Sachs or a time frame for getting returns up to an
Last year, Goldman delivered a return-on-equity of 10.8
percent. Schwartz said that was good on a relative basis, but
not "aspirational for the long term." The measure is important
to shareholders because it measures how much profit a bank can
wring from its balance sheet.
"Shareholders are demanding more accountability," he said.