James Gorman, the Chief Executive Officer of Morgan Stanley, has announced that he will step down from his position within the next 12 months. Gorman has been at the helm of the company since January 2010 and is one of the longest-serving heads of a US bank. He will assume the role of executive chairman for a period of time to assist with the transition to new leadership. The board of directors has identified three senior internal candidates to potentially replace Gorman as CEO.
During his tenure, Gorman is credited with leading a sweeping transformation of Morgan Stanley, which saw the bank diversify away from risk and acquire businesses pivotal to this shift. This includes the $13 billion acquisition of online broker E*Trade in 2020 and the $7 billion purchase of investment manager Eaton Vance completed in 2021.
Under Gorman's leadership, Morgan Stanley also acquired Citigroup’s remaining stake in their joint wealth management venture, Smith Barney, which has since been renamed Morgan Stanley Wealth Management. Gorman also launched the Alliance for Children’s Mental Health in 2020, aimed at helping children and young people with their mental health.
Gorman expressed confidence in the bank's future despite the turmoil in the banking sector, stating, “I remain extraordinarily optimistic about the future Morgan Stanley and our broader economy.” However, shares of Morgan Stanley were down 2.1% by midday Friday.
Gorman succeeded John Mack at the company’s helm after the 2008 financial crisis that saw the company suffer billions of dollars in losses and take hits to its key businesses, including its investment banking and asset management divisions.