James Gorman, Morgan Stanley CEO, July 18, 2023.
Pick, a Morgan Stanley veteran who rose through the ranks to lead the bank’s Wall Street operations, will also join the New York-based bank’s board, according to the release.
Gorman will stay on as executive chairman for an undisclosed period.
The announcement ends the top succession race on Wall Street. Morgan Stanley announced in May that Gorman intended to step down within a year and that it would select his successor from one of the bank’s three main division heads.
Pick led the bank’s institutional securities group, which includes investment banking and trading activities, and was co-president of Morgan Stanley for the last two years.
Among insiders, Pick has long been considered frontrunner for the CEO job because of the complexity and risks involved with leading one of Wall Street’s top firms. Pick, who graduated from Middlebury College and has a Harvard MBA, joined Morgan Stanley in 1990.
He earned his reputation by whipping several businesses into shape during an uncertain time for Morgan Stanley. The bank nearly capsized during the 2008 global financial crisis and needed a $9 billion injection from Mitsubishi bank.
In the aftermath of that tumultuous period, Pick led Morgan Stanley’s equities division to become the global leader by revenue, in part with technology investments for quant investors and an emphasis on becoming a top prime broker to hedge funds.
Then, he was assigned to lead the bank’s ailing fixed income business, where he was credited with another turnaround. That performance led to his most recent role, as head of all Wall Street activity, and ultimately his promotion to CEO.
“The Board’s selection of Ted Pick is an outstanding one,” Gorman said in the release. “I have worked side by side with Ted since the financial crisis and have experienced first-hand his values, intellect, passion and commitment to our people and our clients.”
“He is battle-tested, understands complex risk, and works very effectively not just in the U.S., but around the globe,” Gorman added.
Meanwhile, Pick’s colleague Andy Saperstein was given expanded responsibilities. He was already global head of wealth management; a business that arguably had the greatest positive impact on Morgan Stanley’s stock price in recent years.
Saperstein added the investment management division to his mandate, while the former head of that business, Dan Simkowitz, is now co-president of Morgan Stanley and head of institutional securities.
The arrangement was likely designed to retain the two men who didn’t win the CEO role. On Wall Street, succession races often end with those who don’t become CEO leaving the firm, an outcome Morgan Stanley has sought to avoid.
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