(Bloomberg) -- While Goldman Sachs Group Inc. employees may get less compensation than in the past, many cashed in last year for a payday they’ve been awaiting since the depths of the financial crisis.

Employees exercised options worth $2.03 billion in 2014. More than 96 percent of the contracts were granted as part of 2008 compensation. Last year marked the first time bankers were able to take advantage of those awards.
Goldman Sachs’s stock has more than doubled since it granted 36 million options in December 2008 to give top performers incentive to stay. The bank had been forced to slash compensation costs that year, as a global credit crisis endangered the firm and pushed its shares down 61 percent.
The more-than $2 billion total disclosed in a regulatory filing this week is the pretax gain from exercising the options. Recipients -- who can choose to keep the stock or convert it to cash -- may include former employees who left the New York-based company after receiving the options.
Current partners, who make up fewer than 2 percent of the firm’s 34,000 people, have accounted for an outsize portion of the payoffs. As of August, partners had reaped pretax gains of almost $800 million from the 2008 options. The bank has yet to disclose their activity in the last four months of the year.

Varadhan, Agran

The number of recipients wasn’t disclosed in the filing. The investment bank’s most senior leaders didn’t receive the options, as Chief Executive Officer Lloyd C. Blankfein and President Gary D. Cohn took no bonuses for 2008.
Still, some executives at the bank had options worth more than their annual pay in some years. Harvey Schwartz, who was co-head of the firm’s trading division in 2008 and is now chief financial officer, exercised options worth about $8.8 million in July, leaving him with contracts now valued at about $24 million.
Ashok Varadhan, now co-head of trading, and Gregory Agran, co-head of commodities, exercised options in the first quarter of 2014 worth $31.1 million and $26.7 million, respectively. All three men collected less than half the value of their options because of tax withholding.

Falling Costs

The options were granted at an exercise price of $78.78 and vested over years. An additional $1.4 billion of the 2008 options were still outstanding at the end of 2014, when the stock closed at $193.83.
Goldman Sachs has cut the portion of revenue it pays employees since the crisis as it seeks to boost returns amid higher capital requirements. Compensation costs were $12.7 billion in 2014, down from a peak of $20.2 billion in 2007. Since the 2008 options vested in previous years, their cost wouldn’t have been included in last year’s figure.
The firm said in this week’s filing that it awarded restricted shares worth about $2.5 billion as part of 2014 pay, up from $2.3 billion a year earlier. It didn’t award any options.
To contact the reporter on this story: Michael J. Moore in New York at mmoore55@bloomberg.net
To contact the editors responsible for this story: Peter Eichenbaum at peichenbaum@bloomberg.net David Scheer, Dan Kraut