Morgan Stanley's James Gorman to step down within the next twelve months.
https://www.axios.com/2023/05/19/morgan-stanley-james-gorman:
Morgan Stanley CEO James Gorman will relinquish his title as CEO, and transition to the role of executive chairman within a year.
Why it matters: Gorman's forthcoming departure from the powerhouse in investment banking and deals comes at a pivotal time for a sector being rattled by higher interest rates.
Gorman, who has led the bank since 2009, taking the reins in the aftermath of the 2008 financial crisis, is currently one of Wall Street's longest serving CEOs.
As one of the most prestigious names in banking, however, Morgan Stanley — along with other mega banks — has been largely insulated from the turmoil engulfing regional institutions.
One of Gorman's lasting legacies has been to diversify Morgan Stanley's business lines, in ways that make them less susceptible to interest rate risk, as The Wall Street Journal points out. Its most recent earnings report saw revenues rise as the economy slowed, boosted in part by a boom in wealth management.
Meanwhile, the bank has been preparing for succession for some time.
What he's saying: At the firm's annual shareholder meeting Friday, Gorman said Morgan's board has identified "three very strong senior internal candidates for consideration as the next CEO."
While the exact timing hasn't been worked out, Gorman added that there would be a transition "at some point in the next 12 months."
https://www.cnn.com/2023/05/19/business/morgan-stanley-james-gorman-stepping-down/index.html:
Morgan Stanley chief executive James Gorman will step down as the company’s head within the next 12 months, he said Friday at the bank’s annual shareholder meeting.
“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. That is the current expectation in the absence of a major change in the external environment,” Gorman said Friday.
Gorman, who is one of the longest-serving heads of a US bank, became CEO in January 2010.
He will assume the role of executive chairman for “a period of time” to help Morgan Stanley transition to its next era of leadership, Gorman, 64, said.
The board of directors has three senior internal candidates in the pipeline to potentially take over as the next chief executive.
Gorman also said that he believes Morgan Stanley is well insulated from turmoil in the banking sector after the collapses of three regional lenders.
“In my now long career, I’ve seen a lot of environments. Some challenging, some not. Some crisis, some not,” he said. “I remain extraordinarily optimistic about the future Morgan Stanley and broader economy.”
Morgan Stanley chief James Gorman said Friday he plans to resign as the bank’s CEO within the year, setting off a succession race at one of Wall Street’s top firms.
The bank’s board has narrowed its CEO search to three “very strong” internal candidates, Gorman said.
Morgan Stanley’s CEO candidates are the men leading the bank’s three main businesses: Ted Pick, Andy Saperstein and Dan Simkowitz, according to people with knowledge of the matter.
Morgan Stanley chief James Gorman said Friday he plans to resign as CEO within the year, setting off a succession race atop one of Wall Street’s dominant firms.
The bank’s board has narrowed its CEO search to three “very strong” internal candidates, Gorman told shareholders at the New York-based firm’s annual meeting.
Gorman, 64, will take on the executive chairman role “for a period of time” after stepping down as CEO, he said.
“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.
“That is the current expectation in the absence of a major change in the external environment,” he added.
Since taking over in 2010, Gorman has pulled off one of the more successful transformations on Wall Street. Through a series of savvy acquisitions, Morgan Stanley reversed course after nearly capsizing during the 2008 financial crisis to become a widely-respected wealth management juggernaut.
The firm’s investors have rewarded it with one of the top valuations among big bank peers. That’s because shareholders favor the steadier revenue streams generated by wealth and asset management over the more volatile fees from trading and advisory businesses.
https://www.ft.com/content/9e9b8417-9eb6-4545-aa1a-e58658793c6f:
James Gorman plans to step down as chief executive of Morgan Stanley within the next year after more than a decade at the top of the Wall Street bank he turned into a wealth management juggernaut. Gorman, 64, told the bank’s annual shareholder meeting on Friday that 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”. He added that he expected to become executive chair “for a period of time” after handing over to his successor. Gorman said Morgan Stanley’s board had “identified three very strong senior internal candidates for consideration as the next CEO”. According to people familiar with the matter, the leading candidates to take over are co-presidents Ted Pick and Andy Saperstein, who oversee Morgan Stanley’s institutional securities and wealth management divisions, respectively, and Dan Simkowitz, head of the investment management unit. Chief operating officer Jonathan Pruzan had been another leading contender to take over from Gorman but he departed earlier this year. Morgan Stanley shares were down 0.6 per cent in early Wall Street trading on Friday morning. Australian-born Gorman replaced John Mack as chief executive at the start of 2010, having previously been Morgan Stanley’s co-president in charge of global wealth management, investment management and operations. He became chair in 2012. His appointment 13 years ago underscored Morgan Stanley’s intention to expand in wealth management and diversify away from its legacy investment banking and trading businesses. Gorman has doubled down on wealth and asset management with the acquisitions in recent years of ETrade and Eaton Vance. The bank’s market capitalisation has tripled under his leadership to about $140bn. However, his tenure has not been without blemish. The bank is being investigated by US authorities over its block trading business and this month said it was in talks about settling the case. Gorman told shareholders at the investor event last year that he had no imminent plans to step down from the bank. Along with Jamie Dimon at JPMorgan Chase and Brian Moynihan at Bank of America, Gorman is among a clutch of Wall Street bank chiefs who have bucked a broader trend of shorter executive tenures at US companies.
TLDRS:
- Gorman has led the Morgan Stanley since 2009, taking the reins in the aftermath of the 2008 financial crisis, is currently one of Wall Street's longest serving CEOs and is now calling it quits.
- He's 64, not even full retirement age in the US (not that he will be relying on those benefits) but most Americans would be looking to work at least 3 more years in his shoes before retiring--Americans born in 1960 or later must wait until age 67 to be eligible for their full Social Security benefits.
- Why?
