Morgan Stanley CEO James Gorman announced his plans to step down over the next year, after 13 years at the helm. Gorman has been credited with transforming the Wall Street firm into a wealth management powerhouse, with wealth management accounting for 45% of the firm’s revenue in the first quarter. Three strong candidates have been identified to succeed Gorman, co-presidents Ted Pick and Andy Saperstein, and head of investment management Dan Simkowitz.
Gorman has been praised for his efforts to bolster the leadership ranks and to train and promote potential successors. He has also been instrumental in major deals such as the acquisitions of money manager Eaton Vance, online broker E*Trade, and stock-plan manager Solium Capital.
Morgan Stanley’s first-quarter profit beat expectations as rising revenue from wealth management offset declines in investment banking and trading. Gorman has also been credited with turning around the bank’s fixed-income, currencies and commodities business.
The bank is currently in talks to resolve a more than year-long investigation by U.S. regulators into its block trading practices. Gorman has also been caught up in industry probes by the SEC into employee communications on messaging platforms that had not been approved by the company, which resulted in a $200 million fine.
Gorman’s successor will be chosen in the coming months, and he will become executive chairman once a new CEO is chosen.