The idea of a banker receiving a bonus worth 25 times their salary sounds extraordinary, and for some of Goldman Sachs’ highest-performing London staff, that is the maximum ratio the bank has set. But the headline needs some context: 25 times is a potential bonus ceiling, not a payout that every Goldman Sachs banker receives.
The change reflects the UK’s decision to remove the post-financial-crisis cap on variable pay and has helped reshape how some of the City’s highest earners are compensated.
What’s actually true?
Goldman Sachs removed the previous bonus limit for certain UK employees in 2024, allowing bonuses for eligible “material risk takers” to reach up to 25 times base salary. These are employees whose professional activities can have a significant effect on a bank’s risk profile, including some senior investment bankers and traders.
The important word is “up to”.
It does not mean Goldman pays every eligible banker 25 times their salary. Individual bonuses depend on performance, the bank’s results and the employee’s role. The bank also indicated when introducing the new structure that fixed pay could fall as more compensation shifted towards variable bonuses.
More recent figures provide a useful reality check. For 2025, Goldman’s London investment-bank material risk takers received an average bonus of about $1.1 million, according to regulatory filings analysed by eFinancialCareers. Their average fixed compensation was about $542,000, meaning the typical bonus was roughly twice fixed pay — nowhere near 25 times.
So how much could 25 times actually mean?
The maths can still be eye-watering.
If an eligible banker had a £300,000 salary and actually received a bonus at the full 25-times limit, the bonus would be £7.5 million. That example illustrates the scale of the policy, but it should not be mistaken for a typical Goldman package.
The difference between a theoretical maximum and an average payout matters. Recent data shows that Goldman’s average London investment-bank bonus was around $1.1 million in 2025, while a much smaller group of highly paid employees received several million dollars.
Why did the UK allow bigger banking bonuses?
The old restriction originated from reforms introduced after the global financial crisis. The European Union’s rules limited bonuses for certain bank employees to twice their fixed salary, to reduce incentives for excessive risk-taking.
UK regulators formally removed that restriction after Brexit, allowing individual banks to determine their own limits. Goldman chose one of the most generous potential ratios in the London market, while other major banks adopted lower limits.
The argument from the banking industry was that the old system could make London less competitive with financial centres such as New York, where comparable restrictions did not apply.
What does this mean for ordinary UK workers?
For most people, Goldman’s bonus policy will have little direct effect on their pay packet. But it matters because London’s financial sector is a significant part of the UK economy, and compensation practices can influence where banks choose to employ senior staff and conduct business.
It also feeds into the wider debate about inequality and whether highly variable pay encourages excessive risk-taking.
There is another practical point. A £1 million bonus is not the same as £1 million in take-home pay. Tax, pension arrangements, deferred compensation and shares can all affect the amount an individual ultimately receives.
Common misconceptions about the 25-times figure
- Myth: Every Goldman banker can receive 25 times their salary.
No. The arrangement applies to a limited group of eligible employees, and actual bonuses depend on performance. - Myth: The 25-times figure means Goldman has increased everyone’s pay by 25 times.
No. The change is about the maximum relationship between variable compensation and fixed salary. - Myth: A £300,000 salary automatically means a £7.5 million bonus.
No. £7.5 million is simply 25 times £300,000 if the maximum were actually awarded. - Myth: Bigger bonuses always mean higher total pay.
Not necessarily. Goldman has shifted compensation towards variable pay, while fixed salaries and allowances can be adjusted.
What should readers take from this?
The headline figure is real, but it describes an upper limit rather than a normal payout.
For anyone comparing careers in finance, the lesson is to look at total compensation — salary, bonus, shares, deferred pay and benefits — rather than focusing on the biggest possible bonus multiple.
For investors and policymakers, the more important issue is whether the new pay structures successfully balance competitiveness with responsible risk management.
