Morgan Stanley CEO James Gorman to Step Down Within a Year

(Source: McKinsey)

James Gorman has announced his plan to step down as Chief Executive Officer at Morgan Stanley within a year, bringing his long tenure to a close.

Gorman, who is 64 years old, revealed that the bank's board has identified "three strong candidates" to succeed him, without naming them. He added that he would take on the role of Executive Chairman once a new CEO is selected.

Gorman has been with Morgan Stanley for over 15 years. He joined the Wall Street firm in February 2006 as President and Chief Operating Officer of Wealth Management and was promoted to Co-President of Morgan Stanley and Co-Head of Corporate Strategy in 2007. Gorman became CEO in January 2010 and Chairman in January 2012.

Prior to Morgan Stanley, Gorman had held several executive roles at Merrill Lynch, including Chief Marketing Officer and Head of Strategy and Research. Previously, He was a senior partner of McKinsey & Co., where he was a member of the firm's financial services practice. Earlier in his career, Gorman was an attorney in Melbourne, Australia.

Some analysts expressed concerns that the succession process may disappoint investors. Veteran bank analyst Dick Bove said Gorman's retirement is a blow to the company, and that "the failure to announce a successor will tear the company apart if it is not done quickly," in a note from his role as an analyst at Odeon.

As of the close of last Friday (May 19), Morgan Stanley's share price had fallen to $82.24 per share, a drop of 8.82%.