Morgan Stanley Gives Saperstein Sole Control of Wealth, Moves O’Connor to Bank
Morgan Stanley said on Tuesday that it is breaking up co-management of its wealth management division, consolidating management control under Andy Saperstein and moving 34-year veteran Shelley O’Connor to chairman and chief executive of the company’s two banks.
The pair had been coheads of wealth management, which fueled 40% of Morgan Stanley’s first-quarter profit and 43% of its revenue, since January 2016, following the surprise departure of Greg Fleming.
“Given the criticality of the banks to the future growth of our business, I have asked Shelley to dedicate her full-time efforts to leading them,” Morgan Stanley Chairman and Chief Executive James Gorman wrote in a memo reviewed by AdvisorHub. “Shelley was instrumental in creating the banks, and her extensive Wealth Management experience and leadership make her uniquely suited for this important role.”
The shift comes as Morgan Stanley and major bank-owned rivals such as Merrill Lynch Wealth Management and UBS Wealth Management U.S.A. have been spurring their brokers to sell more mortgages, securities-backed loans and other bank services to their wealthy clients to increase interest revenue and lock customers more strongly to the company.
O’Connor, who had been CEO of Morgan Stanley Private Bank before her elevation to co-head of wealth management, will return to the unit as CEO and retain her title as its chairman. She replaces Eric Heaton as CEO of the private bank, which provides traditional trust services to the wealthy.
O’Connor also is assuming the titles of chairman and CEO of Morgan Stanley Bank NA, the institutional deposit-taking and lending part of the company. Morgan Stanley Vice Chairman Colm Kelleher, who is retiring, had those titles.
Heaton will continue as president of the institutional bank and of the private bank, according to the memo.
“Andy and Shelley have driven our Wealth Management function to its #1 market position, and Andy will continue leading that legacy,” Gorman wrote. “Andy will focus specifically on digital capabilities, enhancing client and advisor experiences, finding areas of growth, and partnering with Institutional Securities and Investment Management.”
O’Connor has worked at Morgan Stanley since 1984, rising through the wealth management division in various branch and regional head positions prior to being named its chief administrative officer in 2006. In 2010, she took the private banking CEO reins, but returned to head sales management for the wealth unit in 2014.
Saperstein, who like Gorman was a former McKinsey consultant and Merrill Lynch manager, joined Morgan Stanley in 2006 from Merrill as chief operating officer of national sales. He briefly ran wealth management prior to Fleming’s arrival, and also served in senior management roles in the company’s institutional securities group.
Gorman also named Rob Rooney, head of the company’s technology and international businesses, to a new position in charge of Technology, Operations and Firm Resiliency. The role recognizes the growing operational risks in areas relating to data management, vendor management and cybersecurity, the memo said.
“Aggregating these functions under a single leader will enable increased efficiency and accountability,” Gorman wrote.
Under the new alignment, global operations head Phil Davies will report to Rooney and have responsibilities as well for “business continuity,” the memo said.
Christopher Randazzo, who played a key technology role as chief information officer for global wealth management and investment management, left Morgan Stanley a year ago to become head of private banking and wealth management at Rockefeller Capital, the recapitalized venture now run by Fleming.