Bank puts aside last year's restraint as it pays staff $15.3bn in bonuses and salaries, despite 38% fall in earnings

Goldman Sachs is to lift the £1m bonus cap imposed on its 100 London-based partners last year as the Wall Street firm begins to hand out multimillion-pound payouts to its staff around the world.

While the average pay and bonus for the 35,700 Goldman employees around the world is $430,000 (£268,000), the biggest hitters will expect to walk away with much more when their managers inform them of their rewards over the coming days.

The best-known of all the Wall Street firms did not attempt to show the restraint of last year as it published its figures for 2010 today. They showed $15.3bn had been set aside for bonuses and salaries.

While this was down 5% on the $16bn for the previous year, the bonus pool did not fall as fast as revenues, which dropped 13% to $39.1bn in 2010.

Revenues fell short of expectations and the shares were down about 3%, dragging down other US banks, which are due to report in the coming days. Earnings – or profits – in 2010 fell 38% to $8.3bn after what had been a difficult for year for Goldman, in which it was fined a record $550m by the US Securities and Exchange Commission in relation to its activities during the sub-prime mortgage crisis.

The bank set aside $2.2bn for pay and bonuses in the fourth quarter alone – even though profit halved to $2.4bn compared with the same period the previous year. It was a sharp contrast to 2009, when it axed payments to its bonus pool to make a $500m public donation to charity.

The proportion of revenue used to pay staff rose to 40% in 2010 – up from the 35.8% the previous year, when it cut the so-called compensation ratio to its lowest level since it went public in 1999 in an attempt to show to pay restraint.

Last year Labour demanded that Goldman in London reduce bonuses as it imposed a tax on payouts of more than £25,000. Goldman said that the tax had cost it $465m.

The bank employs 3,200 more staff that it did a year ago – an increase of 10% – which might explain why the compensation pool has not fallen as far as revenue. The average payout per head has fallen from $498,000, which is closer to the 13% fall in revenue than the overall bonus and pay levels show.

The firm said that $320m of its charitable contributions for 2010 were to charitable foundation Goldman Sachs Gives and that the compensation pot had been reduced to fund this contribution.

The average pay deal at Goldman is larger than the £369,651 (£233,000) a head reported by JP Morgan last week and is also likely to be larger than its close rival Morgan Stanley, which reports later tomorrow.

Business slowed sharply for Goldman in the fourth quarter of last year, as trading in bond markets dried up. Finance director David Viniar said: "In the month of December, things were just dead [in the fixed income division]. There was little activity."

The fall in Goldman's revenues in the fourth quarter was the result of a 10% fall in the investment banking area – where fees from advising on mergers and acquisitions were down – and a 31% fall in revenue from fixed income, currency and commodities, where anxiety about a sovereign debt crisis in Europe held back activity.

This year has not started well for Goldman: earlier this month it was forced to pull out of a private placement deal to enable its wealthy US clients to invest in Facebook. Star trader Kevin Connors, who was co-head of global foreign exchange sales in London, has also left in recent days as a result of breaching internal rules.

In 2010, the firm was fined £17.5m by UK's Financial Services Authority as well as the $550m penalty imposed by the US Securities and Exchange Commission over the Abacus sub-prime mortgage product and the activities of Fabrice Tourre, a London-based employee.

Last April, chief executive Lloyd Blankfein was subjected to a grilling by the US Senate over its activities in the mortgage market before the credit crunch in 2007.