The news swept through Goldman's offices across China, changing everything.
On a Friday afternoon in late 2017, an official in Beijing announced that the world's most populous nation would let Wall Street banks expand across its markets. Goldman had spent more than a decade waiting in frustration for that chance. Regional bosses including James Paradise and Todd Leland urgently worked the phones, pinning down details to inform headquarters in New York.
Since then, Goldman Sachs Group has spoken publicly only in broad strokes about its strategy for China as the gates come down this year. But inside the firm, a massive effort is taking shape. Three months ago, a team of executives presented a five-year plan for China to the board, calling for the bank to take control of a joint venture it set up with a Chinese securities firm in 2004. Infused with hundreds of millions of dollars in new capital, the unit would embark on a hiring spree to double its workforce to 600 and ramp up a wide variety of businesses.
The strategy — described by senior Goldman executives and others familiar with the plan — shows how CEO David Solomon and President John Waldron are taking up the mantle once carried by former CEO Hank Paulson, betting China will finally make the world's second-largest economy a more level playing field for foreign investment banks. Last year, they traveled to China seven times to meet senior officials, laying the groundwork. Another round of visits is set for 2020.
"We're increasingly optimistic that we're going to have the opportunity to actually move more in the right direction, maybe even faster than we thought," Mr. Waldron said in an interview last week. "If you're going to have a successful business in China, you need to have an appropriate relationship with the government because so much happening in China relates to the government."