Goldman Sachs names new operating chief, finance head in executive shakeup

Sept 13 (Reuters) - Goldman Sachs Group Inc on Thursday announced its biggest management shakeup since naming David Solomon as Chief Executive Officer Lloyd Blankfein's successor.

Long-term insider John Waldron will take over as president and chief operating officer. Waldron, who currently runs investing banking, will become Solomon's No.2 when he takes the CEO role in October.

Stephen Scherr will replace Martin Chavez as chief financial officer. Scherr, who has been with the bank for more than two decades, will take over on Nov. 5. 

Chavez will become vice chairman and co-head of the securities division, the company said.

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Goldman Sachs' David Solomon
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Goldman Sachs' David Solomon
UNITED STATES - APRIL 29: David Solomon, managing director and co-head of the investment banking division of Goldman, Sachs & Co., speaks during the Milken Institute Global Conference 2009 in Los Angeles, California, U.S., on Wednesday, April 29, 2009. This year's conference focused on the global financial downturn. (Photo by Jamie Rector/Bloomberg via Getty Images)
David Solomon, managing director and co-head of investment banking at Goldman Sachs Group Inc., speaks during the 2010 Milken Institute Global Conference in Los Angeles, California, U.S., on Wednesday, April 28, 2010. This year's conference is titled 'Shaping the Future.' Photographer: Jonathan Alcorn/Bloomberg via Getty Images
David Solomon, partner and co-head of Investment Banking at Goldman Sachs & Co., speaks during a Bloomberg Television interview at the annual Milken Institute Global Conference in Beverly Hills, California, U.S., on Tuesday, May 3, 2016. The conference gathers attendees to explore solutions to today's most pressing challenges in financial markets, industry sectors, health, government and education. Photographer: Patrick T. Fallon/Bloomberg via Getty Images
David Solomon, president and co-chief operating officer of Goldman Sachs & Co., poses for a photograph following a Bloomberg Television interview at the World Economic Forum (WEF) in Davos, Switzerland, on Thursday, Jan. 19, 2017. World leaders, influential executives, bankers and policy makers attend the 47th annual meeting of the World Economic Forum in Davos from Jan. 17 - 20. Photographer: Simon Dawson/Bloomberg via Getty Images
David Solomon, president and co-chief operating officer of Goldman Sachs & Co., speaks during a Bloomberg Television interview at the Goldman Sachs Technology and Internet Conference in San Francisco, California, U.S., on Wednesday, Feb. 15, 2017. Solomon discussed sentiment in Silicon Valley and financial regulation. Photographer: David Paul Morris/Bloomberg via Getty Images
David Solomon, president and co-chief operating officer of Goldman Sachs & Co., speaks during a Bloomberg Television interview at the Goldman Sachs Technology and Internet Conference in San Francisco, California, U.S., on Wednesday, Feb. 15, 2017. Solomon discussed sentiment in Silicon Valley and financial regulation. Photographer: David Paul Morris/Bloomberg via Getty Images
David Solomon, co-president and co-chief operating officer of Goldman Sachs & Co., speaks during a Bloomberg Television interview at the Milken Institute Global Conference in Beverly Hills, California, U.S., on Monday, May 1, 2017. The conference is a unique setting that convenes individuals with the capital, power and influence to move the world forward meet face-to-face with those whose expertise and creativity are reinventing industry, philanthropy and media. Photographer: Patrick T. Fallon/Bloomberg via Getty Images
David Solomon, Managing Director and Co-Head of the Investment Banking Division, Goldman Sachs, participates in the Corporate Debt Financing and Economic Recovery panel at the 2010 Milken Institute Global Conference in Beverly Hills, California April 28, 2010. REUTERS/Danny Moloshok (UNITED STATES - Tags: BUSINESS)
David M. Solomon, President and Co-Chief Operating Officer of Goldman Sachs, speaks during the Milken Institute Global Conference in Beverly Hills, California, U.S., May 1, 2017. REUTERS/Lucy Nicholson
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Analyst Stephen Biggar of Argus Research was surprised by the announcement, but said Solomon was trying to put together his team.

"It is unexpected. But the timing kind of says the story."

The bank, once considered the most savvy Wall Street trading house, has suffered because of tougher regulation since the 2007-2009 financial crisis and low market volatility crimping revenues.

In its latest reported results, the bank lagged rivals such as JPMorgan Chase & Co, Citigroup Inc and Bank of America Corp in equity trading.

On a call with analysts after the results, executives, including Chavez, were pressed for details on the bank's strategy and disclosures on new businesses.

"John and Stephen will work closely with me to develop and execute our strategy, grow our client franchise, ensure strong risk and capital management and safeguard our unique culture," said Solomon.

Shares of the bank were nearly flat in afternoon trading. The stock has been the worst performer among the top six U.S. banks.

(Reporting by Aishwarya Venugopal and Sweta Singh in Bengaluru; Additional reporting by Diptendu Lahiri; Editing by Shounak Dasgupta)

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