People Moves: Morgan Stanley CEO James Gorman announces intention to step down
Media Article (FN London) -- Morgan Stanley Chief Executive James Gorman said that he plans to step down from the helm of the Wall Street bank within 12 months.
Gorman has been in the top job at Morgan Stanley for 13 years, steering it in the aftermath of the 2008 financial crisis and diversifying its business away from just investment banking activities towards wealth management.
"The specific timing of the CEO transition has not been determined, but it is the board's and my expectation that it will occur at some point in the next 12 months," Gorman said at Morgan Stanley's annual shareholder meeting.
"At that point when I do step down as CEO, it is the board's and my expectation that I will assume the role of executive chair for a period of time," he added.
Gorman said that the bank has identified "three very strong senior internal candidates for consideration as the next CEO".
The 64-year-old Australian kicked off a succession race in 2021 when he named Ted Pick, who runs its institutional securities group, and wealth management chief Andy Saperstein, as co-presidents. The two business lines account for around 90% of Morgan Stanley's revenue.
Jonathan Pruzan, another leading contender for the top job, announced his plans to depart in January. Dan Simkowitz, who leads Morgan Stanley's investment management operation, is another possible successor.
Gorman has received praise for steering Morgan Stanley away from being a pure-play investment bank in the aftermath of the 2008 crisis. While its rival Goldman Sachs has remained heavily reliant on dealmaking and trading, Morgan Stanley has pushed into more stable business lines including wealth management, which helped it navigate a deal drought last year.
In 2020, it unveiled a $13bn all-stock deal to buy E*Trade in an aggressive push for retail banking and brokerage customers in the US. In 2015, the bank also reshaped its fixed income division, while many Wall Street banks stuck to their guns hoping for a bounce back in revenue, cutting around 25% of jobs in the unit.
More recently, the bank has also started to cut costs, with plans for around 3,000 job losses this year following a cull of 2% of its employees in December.
Wall Street's veteran chiefs
Some of Wall Street's biggest banks have changed leadership in recent years. David Solomon took the helm at Goldman Sachs from Lloyd Blankfein in 2018 and has recently retreated from his plans to move into more consumer-facing businesses. Meanwhile, Jane Fraser was named Citigroup's chief executive and succeeded Michael Corbat in 2021, becoming the first female chief executive of a top US bank.
Jamie Dimon, who has been chief executive of JPMorgan since 2005, continues to shrug off questions about when he might step down. Brian Moynihan has led Bank of America for the past 13 years.
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