David Solomon, incoming chief executive of Goldman Sachs, at a summit in Washington earlier this year. PHOTO: ANDREW HARRER/BLOOMBERG NEWS 20 COMMENTS By Liz Hoffman Updated July 30, 2018 4:03 p.m. ET In December 2008, with the financial world in a tailspin, Goldman Sachs Group Inc.GS 0.55% issued stock options to 350 of its top executives and board members. By the time they expire later this year, these options will have earned their owners—most of whom left Goldman years ago—at least $3 billion, according to a review of regulatory filings by The Wall Street Journal. The windfall shows how far Wall Street firms, or at least their stock prices, have come since the crisis. Goldman is less profitable than it was a decade ago, but its share price last year surpassed the previous high set in 2006. Shares of JPMorgan Chase & Co. continue to hit new heights. Options give their holders the right to buy stock in the future at a preset price. If the stock rises above that, holders can exercise and sell the underlying shares, pocketing the difference. If not, they expire worthless. The Goldman options still floating around—including 27,000 held by David Solomon, its incoming chief executive—belong to the last vintage on Wall Street. Big banks have all switched to outright share grants, which governance experts say reward steady stewardship over swing-for-the-fences profit-seeking. Stock options outstanding, year-endSource: the companies .millionGoldmanJPMorganMorgan StanleyBank of AmericaCitigroup2010’12’14’160200400600800 The number of outstanding options at the five largest Wall Street firms has fallen by 95% since 2009. None are issuing new ones. Many banks, short on cash as the crisis deepened, leaned heavily on options that would pay out years later if the firms managed to stabilize and grow. JPMorgan CEO James Dimon received two million options in January 2008 with a strike price of $39.83. He exercised the options last October and hasn’t sold any shares since doing so, filings show. With JPMorgan’s stock price now at $117, his paper gains are about $40 million. Others have been less fortunate. About 90% of the options granted to Bank of America Corp. executives since 2003 have expired worthless, the Journal previously reported. Among the biggest banks, Goldman has the best track record. All six of the options series the bank has granted since 2003 that have expired did so “in the money”—that is, shares were trading above the price at which executives could exercise the options. The lone remaining series are the 2008 options. The bank issued 36 million options with an exercise price of $78.78, the stock’s closing price on Dec. 17, 2008, according to regulatory filings. They went to most of its 350 or so partners, as well as members of the board. At The BottomGoldman issued stock options to executives in2008 that ended up being worth billions.Goldman's stock priceSource: SIX Options issued2010’1550100150200250$300 The timing proved prescient. Within two weeks, shares had cracked $80. By the time the options fully vested in 2012, the stock price was on a nearly uninterrupted rise that would accelerate after Donald Trump won the presidency. At Friday’s closing price of $237.64, each option is worth about $159, after accounting for the exercise cost, more than twice face value. Since 2014, Goldman executives have reported stock sales tied to these options of $506 million, according to a Journal analysis of filings. Goldman partners must report their trades on a regulatory form, known as a 13D, because they agree to vote as a bloc on firm matters, such as annual board elections. Those filings only tell part of the story, though. The filings are intermittent—13Ds are required only when a significant portion of the partnership’s shares change hands—and only capture trading in the previous 60 days. Partners who sell during periods not covered by the filings don’t have to report it. Neither do those who sold after retiring from the firm; three-quarters of people who were partners in 2008 are gone. Some options would have been forfeited if their holders left Goldman for a competitor. All told, the 13D filings account for about one-third of the options. Other, annual Goldman filings show that more than 31 million of the 2008 options have been exercised, the bulk of them in 2014 and 2015, when Goldman shares were trading between $170 and $200. That suggests pretax profits of about $3 billion. One person who didn’t share in the windfall: outgoing CEO Lloyd Blankfein. He didn’t get any of the 2008 options, part of forgoing a bonus that year.