Morgan Stanley To Slash 22 Managing Directors
This article appears courtesy of Institutional Investor
The chief executive of Morgan Stanley is expected to live up to his reputation as "Mack the Knife" as he sharpens his blade to slash up to 22 underperforming managing directors in its investment-banking division, The New York Times reports. Earlier this year Morgan Stanley dismissed about 1,000 poor-performing retail brokers.
Ironically, says The Times, it is the very same unit that was at the forefront of the movement to oust CEO John Mack's predecessor, Phillip Purcell, that is being hit now.
But business is business. Mack ominously told an investor conference that to improve Morgan Stanley's bottom line, "we need to restore premium financial performance."
Chopping out the dead wood is just part of it. Mack reportedly will spend a billion dollars to beef up its direct equity investment, mortgage and derivative businesses.