Bye-bye, Blankfein!
That’s the message that’s being sent to Goldman Sachs’ top boss Lloyd Blankfein.
Over the past two weeks, a growing number of industry players have been suggesting the Goldman chief executive might have to relinquish his post in order to get the firm out from under the Klieg lights of negative press and appease Uncle Sam.
Yesterday, analyst Dick Bove at Rochdale Securities added his voice to the chorus betting that Blankfein will be forced to turn over the keys to the executive washroom.
Goldman — dinged by a record $550 million penalty to settle fraud charges with the Securities and Exchange Commission last year — has since been dubbed in some circles as “a great vampire squid wrapped around the face of humanity,” an infamous quote that dates from a 2009 Rolling Stone article.
Since then the world’s most profitable investment bank hasn’t been able to improve its deteriorating image even after launching its first-ever ad campaign and pursuing an extensive overhaul of its business practices.
Also looming is an ongoing Department of Justice probe sparked by a recommendation by Sen. Carl Levin (D-Mich.), head of the Permanent Subcommittee on Investigations. The committee’s 650-page report laid much of the blame for the mortgage meltdown and resulting financial crisis at Goldman’s doorstep.
“If the Justice Department acts upon recommendations by Congress, there’s no way that Blankfein will be able to stay. He will have to leave,” Bove told The Post.
As Goldman’s legal woes mount, its perception in the public eye is taking a beating too, according to a recent Bloomberg News survey that says 54 percent of people view the firm “unfavorably.”
Earlier this week, Goldman disclosed that the Commodity Futures Trading Commission might pursue fraud charges against the firm.
Bove’s comments to The Post echoed a note that he issued to clients yesterday downgrading Goldman’s shares to a “sell” from “neutral” and cutting its share-price target to $120 from $163.
Shares fell 3.5 percent, or $5.13, to $142.75, and are now down more than 2 percent year to date. Rivals JPMorgan Chase is flat for the year, while Morgan Stanley is off 11 percent.
Sources have told The Post that Blankfein has expressed a desire to remain at Goldman’s helm for at least another two years to right the ship.
And some argue that Bove’s recent downgrade represents a small minority of the 28 analysts that cover the firm. Seventeen maintain “buy” ratings, nine recommend “hold” and two recommend “sell.”
Nevertheless, the 56-year-old Bronx-born Blankfein is encountering some of the stiffest headwinds since the financial crisis three years ago.
“We have to regain trust of the public, we have no choice,” he said earlier this month.
Bove’s research note comes about a week after UBS analyst William Tanona, a former Goldman managing director, suggested that management changes were likely.