Stephen Schwarzman’s income at Blackstone falls 30% to below $1bn

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Stephen Schwarzman’s income from Blackstone Group fell below $1bn in 2023, a decline of more than 30 per cent from the previous year, as a slowdown in dealmaking made it harder for the world’s largest private equity group to sell investments for a profit.

Schwarzman’s near-$900mn haul came mostly from almost $780mn in dividend payments because of his ownership of nearly 20 per cent of the private equity group he co-founded. In addition, he earned about $120mn in “carried interest” and other pay. Both figures reflect steep declines from the prior year as Blackstone sold fewer assets amid rising interest rates.

Schwarzman’s income first topped $1bn in 2021, when he collected $1.1bn. In 2022, it increased to a record $1.3bn.

Top executives at private equity firms typically receive salaries that are modest compared with their entitlement to receive “carried interest”, giving them a share of the profits on successful investments. Founders and top executives such as Schwarzman are also large shareholders, meaning they receive dividend income. Schwarzman and Blackstone president Jonathan Gray’s shares are worth $29bn and $5.2bn, respectively, at current prices.

Executives at Blackstone can receive outsized income in good years because the group traditionally pays almost all of its profits to shareholders in dividends. Some rivals, such as KKR and Apollo Global, by contrast have more stable dividend policies and retain some of their profits to fund future expansion.

Blackstone’s profits fell in 2023 as the performance fees it earned from selling assets dropped by more than half. Last year its distributable earnings — a metric favoured by analysts as a proxy for its cash flows — declined by about a quarter to $5bn.

Blackstone’s hefty dividend payments also helped Gray receive a nine- figure income in 2023. He received more than…