In April, Morgan Stanley chief executive James Gorman announced that Shelley O’Connor, who has co-headed the wealth management business since 2016, is taking over the private bank and the institutional banking unit, leaving Andy Saperstein to run wealth management solo.
In some ways, it looks like a move to replace Colm Kelleher, who currently runs the institutional banking business and who retires in June. But there is a sense that by putting O’Connor in to oversee the two banking parts of the business (with Eric Heaton becoming president of the two), Gorman is setting his sights on building out Morgan Stanley as a full-blown bank – selling mortgages and deposit accounts and credit. Indeed, in his memo to the firm, Gorman referred to the “criticality of the banks to the future growth of our business”.
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Shelley O’Connor, |
Morgan Stanley Private Bank was created after the financial crisis to increase deposits and lend more to customers. O’Connor helped create the banking business and ran the private bank: she’s the right person to oversee their expansion.
It’s not necessarily new news – Gorman has expressed for many years that Morgan Stanley has had its eye on the steadier, lucrative plain-vanilla banking business.