Why it matters: A dose of uncertainty in a stable bank.
Mr Gorman took over the bank in 2010 after Morgan Stanley nearly collapsed during the previous financial crisis. His tenure as CEO was one of stability, at least by investment bank boom-and-bust standards. Morgan Stanley has sidestepped its consumer banking rival Goldman Sachs’ weaknesses and stayed true to its mission of making billions of dollars from its consulting work for corporations and wealthy individuals, including Elon Musk.
But like its peers, Morgan Stanley has been pressured lately by a slowdown in its day-to-day work of helping companies go public, merge and acquire others.
In a sign of its financial health, Morgan Stanley was among the banks that poured billions of dollars into an ultimately unsuccessful attempt to bail out ailing mid-market lender First Republic. Morgan Stanley has since hired some of the failed bank’s advisors, bolstering its already enviable wealth management business, formerly called Morgan Stanley Smith Barney.
On Friday, Mr Gorman said: “In my view we are not in a banking crisis but we have had and may continue to have a crisis in certain banks.”
Background: An “invisible” hand on Wall Street.
Australian by birth, Mr. Gorman worked at the consulting firm McKinsey & Company before becoming a banker.
Unlike JPMorgan Chase’s Jamie Dimon, the only major bank chief with a longer tenure, Mr. Gorman has maintained a muted public presence. “I’m pretty invisible, and that’s okay,” he told the New York Times in 2014.
Mr. Gorman is one of the highest paid CEOs of publicly traded companies on Wall Street, making $31 million in 2022.
Mr Dimon is 67 years old and has shown no signs of stepping down anytime soon. Mr Gorman, 64, is likely to retire at the same age as his predecessor, John Mack, who retired at 65.
What’s next: A race for corporate succession.
Neither Mr. Gorman nor Morgan Stanley gave an exact date for his departure from the position of CEO. Mr Gorman said he expects to take over the position of chief executive “for a period of time” after stepping down.
Echoing his public statements, Mr. Gorman noted Friday that there were three “very strong,” unnamed, internal candidates for the takeover.
When Mr. Gorman announced his resignation without naming the bank’s next chief executive officer, he said he was aware of the television series “Succession,” which for years told the story of intense corporate power struggles.
Citing the drama surrounding the show’s late patriarch, the Morgan Stanley boss said he has “no plans to date Logan Roy”.
