Fox Business Network’s (FBN) Senior Correspondent Charlie Gasparino reports Morgan Stanley (NYSE:MS) spokesperson Michele Davis is not denying brokerage chief Greg Fleming as “heir apparent to chief executive James Gorman.” Gasparino went on to report that “people inside Morgan say [CEO James] Gorman may offer [Morgan Stanley Institutional Securities President Colm] Kelleher a spot on the firm’s board as a consolation prize.”
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On whether Greg Fleming is in line to be the next CEO of Morgan Stanley:
“Morgan Stanley is denying that its brokerage chief Greg Fleming has been told that he is the firm’s de facto No. 2 and heir apparent to CEO James Gorman. Or is it? A spokeswoman for the big Wall Street firm Michele Davis offered contradictory statements Thursday on firm-wide speculation that Fleming has been guaranteed the top spot after the Gorman era is over. According to Davis, Gorman himself has not promised Fleming the top spot, but she wouldn’t deny that in the firm’s current succession plan, Fleming would be named CEO if Gorman somehow left. “I have no comment,” Davis said when asked if Fleming has been chosen to lead Morgan Stanley under succession circumstances. “The rumor that James Gorman has informed Fleming he is the de facto No. 2 is false.” But Davis wouldn’t deny that Fleming is already the de facto No. 2 at the firm, refusing to comment on that.”
On whether Morgan Stanley President of Institutional Securities Colm Kelleher will be offered a board seat as consolation:
“Another factor in favor of Fleming is his age; he is six years younger than Colm Kelleher, another potential replacement for Gorman. Both Kelleher and Fleming are presidents, running Morgan’s institutional and wealth management businesses, respectively. People inside Morgan say Gorman may offer Kelleher a spot on the firm’s board as a consolation prize. Davis declined to deny that possibility. Since late 2009, when Gorman was named to replace former Morgan Stanley chief John Mack, shares of the firm have risen 20%, compared to 14% for rival Goldman Sachs. Analysts attribute much of this success to Gorman’s vision of building out Morgan Stanley’s brokerage division that he cobbled together in large part by purchasing the Smith Barney unit from Citigroup following the banking crisis.”