Strategy
Gorman Flags Expansion of Morgan Stanley Wealth Business
Morgan Stanley will move onto the “front foot” to expand its wealth management business in the US and overseas following more than a year of restructuring, James Gorman Morgan Stanley GWM head told WealthBriefing.
Morgan Stanley will move onto the “front foot” to expand its wealth management business in the US and overseas following more than a year of restructuring, James Gorman Morgan Stanley GWM head told WealthBriefing.
Mr Gorman said Morgan Stanley had an underrepresented private client and brokerage presence in all the major US markets and in most international markets in wealth management.
“We will grow whether we make acquisitions or not. That said we’re looking at a lot of acquisitions in wealth management, especially high end private wealth management businesses, and I am hopeful we will get some deals done both domestically and internationally,” he said.
Morgan Stanley’s advice business has been retracting as the firm fired some 1,500 advisors in two separate lots within the last two years in an effort to enhance profitability.
At the end of the last quarter Mr Gorman said the business had a net gain of 144 financial advisors, reaching 8,137.
“We’re at the end of a year and a quarter turnaround,” he said.
Mr Gorman pointed to New York, Las Angeles, Chicago and Atlanta as cities he had earmarked for expansion.
Overseas he said the firm was unlikely to add to its existing locations which include Singapore, Hong Kong, Dubai, London, Zurich, Geneva and Milan.
“Internationally we have a lot of areas we’re poised for growth,” he said. “We don’t need more locations, we need more people in the existing locations.”
On the price rival firms have paid for wealth management acquisitions – like Bank of America’s $3.3 billion purchase of the US Trust private banking arm – Mr. Gorman said he believed the deals are expensive but not excessively priced.
“Clearly by historical standards they are expensive but we’re entering a boom period for wealth management services, and I think likely to stay like that for some years,” he said.
