Blankfein still missing Goldman’s magic number

February 12, 2013, 11:57 PM UTC

FORTUNE — Lloyd Blankfein may soon have to walk away from a $10 million payday.

Two years ago, Goldman Sachs set up a special bonus plan for its CEO and four other top executives that would produce an eight figure payout should the firm hit specific profit targets. At the time, some shareholders complained the targets in the bonus plan were too easy. So far, though, CEO Blankfein and the rest of his team have missed their mark.

According to the plan, for Blankfein and the others to each be awarded the $10 million payday, Goldman has to produce a return on equity, a key measure of profitability for Wall Street, of 15% on average for 2011, 2012 and 2013. The firm’s book value per share also has to rise by an average of 12% a year. The group also includes COO Gary Cohn and vice-chairmen Michael Evans and John Weinberg. Goldman’s former CFO David Viniar was also part of the original group, but he gave up the chance to get the bonus when he retired last month.

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With one year left, it’s not looking good for Blankfein’s special bonus. Goldman’s ROE was a mere 3.7% in 2011, and the company’s book value rose by only 1%. Last year, the firm did better. ROE rose to 10.7%. Goldman’s book value jumped 11%. The result: For Blankfein and others to cash in, Goldman would have to have an ROE of just over 30% this year. Its book value per share would have to rise 24%. The special bonuses, if earned, are to be paid out January 2014.

What’s the chance of that happening? Not much. According to Thomson Financial, analysts predict Goldman to have an ROE of a little over 9% this year.

That won’t stop Goldman from trying. Speaking to investors and analysts at the Credit Suisse Financial Services Conference on Tuesday morning, Goldman’s new CFO Harvey Schwartz said he thought the firm would soon produce higher returns “because we have to.” Without citing any specific plans for Goldman, Schwartz said he thought some of those gains in profitability would have to come from more layoffs.

A poll of people who were attending the Goldman (GS) presentation showed that more than half expected the company to produce an ROE of 12%. Schwartz seemed to suggest that the estimate was too low.

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Under the plan, Blankfein and the others could still be eligible for a lower bonus of $7 million. For that to happen, Goldman would still have to have an ROE of nearly 16% this year. Its book value per share would have to jump by 9%. Even without the special bonus, Blankfein has gotten a pay raise. The firm recently disclosed that it paid Blankfein $19 million in cash and stock for 2012, up from $13.3 million the year before.

And Goldman appears to be doing what it can to juice its numbers. The bank bought back $1.5 billion of its shares in the fourth quarter, more than analyst were expecting. That should boost ROE and book value per share, even if profits don’t rise.

What’s more, at least for now Goldman appears to still be making good money from its own investment portfolio. In its most recent quarter, the company recorded nearly $2 billion in revenue in its investment division. Goldman says it no longer engages in so-called proprietary trading. But the firm has held onto most of its private equity investments and says it has no immediate plans to get out of the business. The Dodd-Frank financial reform rules may force Goldman to further curtail its investment activities. But those rules don’t kick for a little while still, and Goldman has shown it won’t likely leave those businesses voluntarily, at least not before January 2014.