Goldman Sachs to demand junior bankers ‘pledge loyalty every 3 months’

Goldman Sachs is getting ready to impose a new requirement that junior bankers regularly pledge their loyalty to the Wall Street giant — a clampdown designed to reduce defections to high-paying private equity firms, according to a report.

The new policy, which has not been publicly announced, will ask new analysts to certify in writing every three months that they remain committed to Goldman Sachs and have not accepted offers from a rival employer, Bloomberg News reported.

The move is designed to counteract aggressive recruitment of junior banking talent. Critics say that the tactics, known as on-cycle recruitment, are used by private equity firms to effectively exploit investment banks as free training grounds.

Junior analysts spend a year or less at a bank learning deal modeling, client interaction and industry knowledge — and then jump to private equity, often with better hours and higher pay.

Banks foot the bill for recruiting, onboarding and training — only to lose talent before that investment pays off.

To make matters worse for investment banks, analysts who accept offers from private equity firms often continue working for their employer on sensitive deals — making them privy to confidential information.

This raises potential conflicts of interest, as they now hold information that may be valuable to their future employers.

Some firms have even approached candidates before they begin their analyst programs, contributing to growing tension in the industry.

The practice has drawn criticism across Wall Street. Last month, JPMorgan Chase warned incoming graduates that they would be fired if they accepted future job offers from other firms before completing their first 18 months.

JPMorgan CEO Jamie Dimon addressed the issue last September at Georgetown University, calling the recruitment practice unethical.

“It puts the kid in a terrible position, and so I think that’s wrong,” Dimon said. “It puts us in a bad position, and it puts us in a conflicted position. You are already working for somewhere else and you’re dealing with highly confidential information.”

Around the same time, Apollo Global Management announced it would not interview or extend offers to the class of 2027.

The practice of on-cycle recruitment also can compel junior bankers to make significant career decisions within days — or even hours — of starting their first jobs, before they’ve had a chance to gain meaningful work experience or fully evaluate their options.

Apollo CEO Marc Rowan explained the move by saying that “asking students to make career decisions before they truly understand their options doesn’t serve them or our industry.”

Those who need more time to make informed decisions or who lack extensive networks may be left behind while analysts who develop relevant skills or career interests later in their tenure may find themselves excluded from top opportunities, reinforcing a system that rewards early movers over potentially more qualified candidates.

The rushed process also is known to create intense stress for candidates who are forced to frequently endure late-night interviews. It can also contribute to a false sense of urgency, pressuring candidates to accept offers quickly and potentially miss out on opportunities that are more suited to them.

Goldman Sachs, which emphasizes a strong alumni network and highlights “boomerang” hires, faces a balancing act in managing current employees while preserving relationships with those who leave.

Goldman Sachs has struggled with significant and long-standing challenges in retaining junior bankers over the past decade.

The bank has heard complaints from employees about grueling work hours, intense workplace pressure and heightened competition from other industries that offer more attractive work-life balance and compensation structures.

Junior bankers at Goldman have reported extreme workloads, often clocking 95 to 105 hours per week. Some described getting only five hours of sleep a night and going to bed at 3 a.m.

The Post has sought comment from Goldman Sachs.