Phil Purcell, Morgan Stanley’s chairman and CEO, has bitten the bullet and finally announced he is stepping down.
“It has become clear that, in light of the continuing personal attacks on me, and the unprecedented level of negative attention our firm – and each of you – has had to endure, this is the best thing I can do for you, our clients and our shareholders,” he said in a letter to staff.
His previous decision to stay and fight the dissident shareholders calling for his removal was damaging the brand, The Banker argued in May.
Mr Purcell said he would remain in the job until a successor was named but would not stay beyond the company’s annual general meeting next March. Analysts believe his replacement must be found much sooner to stem the exodus of talent from the bank.
The board has ruled out a number of possible candidates, including John Mack, the Morgan Stanley boss who shared power with Mr Purcell at the beginning of the Morgan Stanley Dean Witter merger. Bob Diamond, the head of Barclays Capital, who recently became a board member of Barclays Bank, has ruled himself out.
John Studzinski, a former deputy chairman of Morgan Stanley International, who joined HSBC to turn its investment bank into a major player, has been mooted as a possible candidate for the job.
Morgan Stanley posted a 24% drop in second-quarter earnings to $928m on June 22. Only a week earlier, it predicted profits would be 15%-20% down on the previous year.
Despite this, Morgan Stanley’s market share in mergers and acquisitions in the second quarter was 1% up on the previous quarter, according to research firm CreditSights.
