James Gorman is stepping down as Morgan Stanley CEO throughout the subsequent 12 months as a revered government who grew the agency largely by placing wealth administration on the forefront.

Whereas it’s too quickly to know what the longer term holds for Morgan Stanley’s advisors, or who will exchange Gorman, business consultants who work with wirehouse advisors and corporations mentioned Friday they anticipate his successor to proceed the agency’s wealth administration enterprise down the trail he laid for it.

“Morgan Stanley, beneath the management of James Gorman, has completed what Goldman Sachs to date has not,” Mark Elzweig, president of consultancy Mark Elzweig Co., instructed ThinkAdvisor by e mail. “He diversified their retail income streams with the purchases of E-Commerce and Solium. Each of these companies now present leads for his or her high advisors. Gorman moved the agency away from a buying and selling store with a retail division right into a well-diversified wealth administration powerhouse targeted on fee-based enterprise.”

Two of the consultants mentioned that Gorman’s substitute might be Andy Saperstein, managing director and head of Morgan Stanley Wealth Administration.

Will Recruits Wait and See?

Gorman’s departure from the highest job “leaves slightly little bit of an unknown as his messages and affect created [a] regular path” for Morgan Stanley advisors, compensation marketing consultant Andrew Tasnady, managing associate of Tasnady Associates, instructed ThinkAdvisor by e mail. Sometimes, advisors are “not eager on unknowns or adjustments” till they’re certain the means ahead shall be calm, he mentioned.

“Advisors knew what to anticipate from becoming a member of MS,” Tasnady mentioned. “Some new potential recruits might pause till they see what the substitute holds concerning any adjustments in course.”

Gorman’s greatest contribution to Morgan Stanley’s wealth administration enterprise was “figuring out and lobbying [the] remainder of MS administration on the worth of wealth administration vs. the remainder of MS companies,” however his successor “would possibly maintain [a] considerably totally different imaginative and prescient on [the] relative steadiness of the companies,” Tasnady added.

In the meantime, in keeping with Danny Sarch, president of Leitner Sarch Consultants, “Gorman’s leaving will solely influence the advisors if the brand new CEO has a special imaginative and prescient. It’s too early to inform. I don’t assume the announcement may have any impact on recruiting.”

Louis Diamond, president of Diamond Consultants, instructed ThinkAdvisor in a telephone interview: “Gorman has been one of the revered CEOs throughout the monetary providers business as an entire. The technique that Morgan Stanley has employed of shopping for Solium and E-Commerce, and actually making a much bigger play throughout the office, has been very properly obtained.”

Diamond predicted: “So long as Morgan continues its technique and focuses on persevering with to develop its assets and platforms for advisors, it seemingly shouldn’t have a serious influence on advisors as a result of I feel he’s already sort of laid the groundwork and basis for a really profitable run for whoever the successor is.”

Diamond additionally predicted Gorman’s leaving gained’t have an effect on the agency’s wealth enterprise as a result of the agency “already derives a lot of its income from wealth and funding administration, and that technique is properly in place.”