Morgan Stanley, one of Wall Street’s most prestigious banks, said on Wednesday that it had chosen Ted Pick, a three-decade veteran of the firm, to be its next chief executive, ending an unusually public three-way race that James Gorman, the chief executive since 2010, once jokingly compared to the television series “Succession.”
Mr. Pick will begin his new role in January. His rivals for the job, Andy Saperstein and Dan Simkowitz, will take on bigger roles as co-presidents, overseeing Morgan Stanley’s wealth management and sales and trading businesses.
Mr. Gorman, 65, said he hoped and expected that Mr. Saperstein and Mr. Simkowitz would stay for the long term. The bank did not make either man available to be interviewed.
“We were lucky that we had three really talented internal candidates,” Mr. Gorman said after the announcement. “Everyone told me that would lead to some major tribal wars — that didn’t happen.” The bank had publicly identified those internal candidates, a departure from the typically hush-hush process favored by much of corporate America for top jobs.
Mr. Pick, 54, joined Morgan Stanley in 1990 and rose through the ranks in its investment banking and trading businesses, most recently serving as a co-president overseeing those units. In an interview, he said he hadn’t found out that he would be named chief executive until around 4:30 p.m. Wednesday, when the bank’s board of directors called him into a meeting and welcomed him with a standing ovation.
He stands to inherit a very different bank from the one Mr. Gorman took over after the 2008 financial crisis. Morgan Stanley’s big bets on subprime loans soured during the mortgage meltdown, leaving it reeling from enormous losses and forcing it, like many of its peers, to search for outside investors and seek a government bailout.
Even before the financial crisis, Morgan Stanley had been the site of plenty of Wall Street theater; in 2005, John J. Mack, a longtime leader of the bank who had left to take the top job at Credit Suisse, returned in a boardroom coup, ousting Philip J. Purcell as chief executive. The power struggle was captured in “Blue Blood and Mutiny: The Fight for the Soul of Morgan Stanley,” by the journalist Patricia Beard.
But just four years later, Mr. Mack said he would step down as chief executive, after a tumultuous period of both high profits and losses left the publicly traded bank’s stock price reeling. Mr. Gorman steadied the bank by focusing on building its brokerage business, including the Smith Barney franchise it acquired in 2009, which caters to wealthy individuals. Big acquisitions in wealth management, such as the $13 billion purchase of E-Trade in 2020, have further buttressed Morgan Stanley’s business, reducing its reliance on banking and trading units that can be more volatile.
The bank also caters to “blue blood” clients like Elon Musk. With a strong technology banking practice, Morgan Stanley played a central role last year in Mr. Musk’s takeover of Twitter, now known as X. The bank was among those that lent Mr. Musk money to do the deal, a decision that may lead to losses given the social media platform’s struggles.
In recent years, Morgan Stanley has kept a lower profile than many of its peers, at least compared with the drama at its downtown rival, Goldman Sachs. David M. Solomon, the chief executive of Goldman, has been trying to reorient its business toward its traditional mainstays after an ill-fated push into consumer banking, even as rumors swirl about how long he will remain in the job.
Morgan Stanley has hit some speed bumps of late. In its latest quarterly earnings report last week, investment banking revenue plunged, wealth management inflows slowed and profit was down nearly 10 percent from a year earlier.
The bank’s stock has fallen 17 percent this year. Shares were little changed in after-hours trading after Mr. Pick’s appointment was announced.
Neither Mr. Gorman nor Mr. Pick said he was bothered by the stock slide. Both said Mr. Pick’s selection should not be interpreted as a sign that the bank will favor any of its particular business arms.
“There will be a change in leadership, but there will not be a change in strategy,” Mr. Pick said.
Added Mr. Gorman: “You pick a C.E.O. based on their instincts.”
One thing that has changed, Mr. Pick said, is his vocabulary. The Wall Street Journal reported in 2017 that his penchant for profanity had earned the attention of Morgan Stanley’s top brass.
Asked about his current practices, Mr. Pick said he had adopted “the King’s English” and was “very much fond of the entirety of the lexicon.” He added, “There’s a whole panoply of places to go beyond the four letters.”