Goldman Trading Chief Exits -- WSJ

By Liz Hoffman 

This article is being republished as part of our daily reproduction of WSJ.com articles that also appeared in the U.S. print edition of The Wall Street Journal (September 21, 2018).

Goldman Sachs Group Inc.'s stock-trading chief is leaving the firm, the first senior departure as incoming Chief Executive David Solomon sets priorities and puts his own team in place.

Paul Russo, who has run Goldman's equities business since 2012, is negotiating his exit and is likely to depart in the coming weeks, according to people familiar with the matter. The firm is likely to give additional responsibilities to three executives -- Brian Levine, Jeff Nedelman and Phil Berlinski -- while Mr. Russo's counterpart, Michael Daffey, continues to head the business globally from London, some of the people said.

A spokesman for Goldman declined to comment. Mr. Russo couldn't immediately be reached for comment.

The change comes at a tough time for the equities business across Wall Street and, in particular, at Goldman, which has ceded ground to rivals in recent years.

The rise of electronic trading has reduced fees and forced banks to spend heavily to upgrade their software. Meanwhile, startups are peeling away the lucrative business of structuring derivatives, and hedge funds, once big fee-payers, are struggling.

Goldman's equities revenue has fallen to $6.6 billion last year from a peak of $11.3 billion in 2007. It has stabilized in recent years and held up better than the firm's fixed-income trading business.

A Goldman lifer, Mr. Russo is respected on the trading floor and in Washington, where he is often the firm's voice on trading regulations and market-structure issues. He joined as a summer intern in 1989 and rose the ranks in equity derivatives, trading products tied to volatility and stock indexes.

His is the first in a series of expected departures in Goldman's trading arm as Mr. Solomon makes his own promotions and readies his agenda. In the past month, Mr. Solomon has appointed two heads of the trading division, simplifying what had been a clunky leadership setup but snubbing some hopefuls in the process.

Overall, the changes tilt Goldman's trading business toward sales and software and were read by many on the floor as leaving less of a role for traditional traders like Mr. Russo.

Mr. Nedelman came up as a stock salesman covering big investment funds such as Capital Group. Since 2016 he has run Goldman's prime brokerage business, which caters to hedge funds.

Messrs. Levine and Berlinski are both traders, rather than salesmen. Mr. Levine came up trading technology stocks and later ran a desk that trades baskets of shares against indexes. Mr. Berlinski, based in London, previously oversaw stock trading across Europe and Asia.

--Rachael Levy contributed to this article.

Write to Liz Hoffman at [e-mail]

(END) Dow Jones Newswires

September 21, 2018 02:47 ET (06:47 GMT)

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