banking and trading
Ted Pick said his promotion represents a change in leadership but not a change in strategy. MORGAN STANLEY, ANGUS MORDANT/BLOOMBERG NEWS
By AnnaMaria Andriotis
Oct. 26, 2023 12:48 pm ET
3 RESPONSES
Explore Audio Center
A group of
Morgan Stanley
executives attending a post-workday dinner in London were ready to call it a night. Ted Pick wanted to play a game.
The veteran banker, who had organized the outing, challenged his colleagues to beat him at math equations. They began throwing out six-figure numbers to be multiplied by other large numbers. Pick nailed every equation before anyone else could. He even beat one executive who was using a calculator.
Although the impromptu math contest was more than a decade ago, it has become part of Pick’s lore within Morgan Stanley.
“I’ve worked for a lot of bosses, but no one quite like Ted,” said a former longtime Morgan Stanley executive. “He’s got a mind like I’ve never seen before.”
Pick, who will turn 55 on Halloween, has spent his entire career at Morgan Stanley. Current and former executives say it is hard to think of someone whose allegiance to the bank—“He bleeds blue,” as they say—is greater.
On Wednesday, Morgan Stanley announced that Pick would succeed James Gorman to become the bank’s next chief executive. Gorman, 65, has held the CEO job for almost 14 years.
Pick said his promotion represents a change in leadership but not a change in strategy. “This is about keeping going a great thing,” he said.
Gorman, on the other hand, took the approach of turning things inside out when he became CEO in 2010. Morgan Stanley had just survived a near-death experience in the 2008-09 financial crisis, and Gorman wanted the bank to be more stable than the typical Wall Street roller coaster. So he doubled down on the steadier business of wealth management. It now makes up about half of the bank’s total revenue, helping to smooth the ups and downs of trading and investment banking.
Longtime Morgan Stanley CEO James Gorman says of the man picked to be his successor: ‘Ted creates a phenomenal following.’ PHOTO: MICHAEL BUCHER/THE WALL STREET JOURNAL
Pick’s background is in that trading and investment banking side of the house and not wealth management. Keeping everyone happy will be a challenge.
In Pick, Gorman sees a fix-it man who turned around the stock-trading arm and then bond trading. “Ted creates a phenomenal following—the fact that the other two candidates will stay on speaks volumes of his leadership,” Gorman said. On Thursday morning, Pick got a standing ovation on the trading floor.
The other executives who were in the running for the top job were Andy Saperstein, co-president and head of wealth management, and Dan Simkowitz, head of investment management and co-head of corporate strategy. Both are being promoted to new jobs.
Tougher times could be ahead. The bank just reported third-quarter results that included a sharp drop in investment-banking revenue, falling short of results at rivals. Net new assets in wealth management slowed substantially, rattling some shareholders. And higher-for-longer interest rates are putting pressure on deal making and wealth management across the industry.
A blemish on Pick’s record that is yet to be resolved is Morgan Stanley’s role in a block-trading scandal. The bank is in the midst of trying to settle a probe into whether bankers shared details about impending share sales with favored clients before they were publicly disclosed.
Finance hasn’t been Pick’s only interest. As an undergrad at Middlebury College, he studied Russian history and politics.
Tom Nides, a former chief operating officer at Morgan Stanley, said Pick and his family visited him earlier this year in Israel while Nides was the U.S. ambassador. “He wanted to make an effort to say, ‘We are not going to Paris or London—I’m going to show you this really beautiful country,’” Nides said. “He wants his kids exposed to the world, not just New York.”
Morgan Stanley is in the midst of trying to settle a probe into whether bankers shared details about impending share sales with favored clients before they were publicly disclosed.
Pick started at Morgan Stanley in 1990 as an investment-banking analyst. He came in not knowing much about finance. He stayed after realizing that the industry would challenge him.
He later left to get an M.B.A. at Harvard and then returned. He spent most of the next 15 years in equity capital markets, which takes companies public and manages their stock sales.
He was later put in charge of the bank’s stock-trading arm, which had been badly damaged in the crisis. One client, Roberto Mignone, founder of Bridger Management, sent Pick a replica of the Titanic. Pick displayed it in his office.
“Keeping the modesty in the middle of the congratulations” is how Mignone described his gift.
“He kept it in the office for years and it was enormous,” he added.
Mignone, a Morgan Stanley shareholder, said he knew all along that Pick’s ship wouldn’t sink. He helped rebuild relationships frayed by the firm’s near-collapse. In the office, Pick insisted on keeping an armchair once used by a predecessor, John Havens. The chair had been in storage; Pick had it brought out in honor of his mentor.
Havens said he thought often that Pick had what it took to be CEO.
When Pick was later asked to grow the fixed-income business, he called the equities team into a room. “Make sure you guys continue to be No. 1!” he yelled. Some were angry. Others thought it was Pick’s way of making sure they didn’t drop the ball.
A dark moment for Morgan Stanley came when Archegos Capital Management imploded in 2021. Morgan Stanley lost $911 million. Pick laid out for the board where his team had gone wrong and what he would do differently.
Ted Pick studied Russian history and politics. in college. PHOTO: JEENAH MOON/BLOOMBERG NEWS
Even supporters say Pick can be a hothead, and it isn’t rare for him to go off on subordinates. But friends say he has also mellowed with age. He can make an effort to try to work things out afterward, sometimes circling the block around the bank’s offices in Midtown Manhattan with a colleague he has just yelled at.
He can also be harsh with employees who show even a whiff of disloyalty to the bank or to his direct reports. Those who criticize his close circle of key executives can eventually find themselves out of a job, according to people familiar with the matter.
Current and former executives say Pick is both feared—they know to be on their game when they meet with him—and respected. He holds regular meetings with managing directors where he gets into the weeds on deals they are working on.
Supporters say he likes to help deputies work out problems for themselves. Sometimes, if a deputy mentions an idea that he dislikes, Pick is known to lie on the couch in his office, look at the ceiling and say, “Wait, I don’t understand how this would pan out.”
The idea is to get the colleague to think through different scenarios and then conclude on their own that the idea doesn’t make sense. Colleagues say he would rather run through every scenario before a decision than deal with a post mortem.
On his coffee table, among an array of books, is former CEO John Mack’s memoir. In the depths of the financial crisis, Pick regularly rode the elevator up to the 40th floor to update Mack on how the bank’s shares were doing.
In years past, deputies often avoided his office in the evening hours when they were trying to head home, walking a longer way to the elevator instead. Those who didn’t often heard Pick ask them to come into his office to talk about the day—only to emerge an hour or more later.
Ted Pick said his promotion represents a change in leadership but not a change in strategy. MORGAN STANLEY, ANGUS MORDANT/BLOOMBERG NEWS
By AnnaMaria Andriotis
Oct. 26, 2023 12:48 pm ET
3 RESPONSES
Explore Audio Center
A group of
Morgan Stanley
executives attending a post-workday dinner in London were ready to call it a night. Ted Pick wanted to play a game.
The veteran banker, who had organized the outing, challenged his colleagues to beat him at math equations. They began throwing out six-figure numbers to be multiplied by other large numbers. Pick nailed every equation before anyone else could. He even beat one executive who was using a calculator.
Although the impromptu math contest was more than a decade ago, it has become part of Pick’s lore within Morgan Stanley.
“I’ve worked for a lot of bosses, but no one quite like Ted,” said a former longtime Morgan Stanley executive. “He’s got a mind like I’ve never seen before.”
Pick, who will turn 55 on Halloween, has spent his entire career at Morgan Stanley. Current and former executives say it is hard to think of someone whose allegiance to the bank—“He bleeds blue,” as they say—is greater.
On Wednesday, Morgan Stanley announced that Pick would succeed James Gorman to become the bank’s next chief executive. Gorman, 65, has held the CEO job for almost 14 years.
Pick said his promotion represents a change in leadership but not a change in strategy. “This is about keeping going a great thing,” he said.
Gorman, on the other hand, took the approach of turning things inside out when he became CEO in 2010. Morgan Stanley had just survived a near-death experience in the 2008-09 financial crisis, and Gorman wanted the bank to be more stable than the typical Wall Street roller coaster. So he doubled down on the steadier business of wealth management. It now makes up about half of the bank’s total revenue, helping to smooth the ups and downs of trading and investment banking.
Longtime Morgan Stanley CEO James Gorman says of the man picked to be his successor: ‘Ted creates a phenomenal following.’ PHOTO: MICHAEL BUCHER/THE WALL STREET JOURNAL
Pick’s background is in that trading and investment banking side of the house and not wealth management. Keeping everyone happy will be a challenge.
In Pick, Gorman sees a fix-it man who turned around the stock-trading arm and then bond trading. “Ted creates a phenomenal following—the fact that the other two candidates will stay on speaks volumes of his leadership,” Gorman said. On Thursday morning, Pick got a standing ovation on the trading floor.
The other executives who were in the running for the top job were Andy Saperstein, co-president and head of wealth management, and Dan Simkowitz, head of investment management and co-head of corporate strategy. Both are being promoted to new jobs.
Tougher times could be ahead. The bank just reported third-quarter results that included a sharp drop in investment-banking revenue, falling short of results at rivals. Net new assets in wealth management slowed substantially, rattling some shareholders. And higher-for-longer interest rates are putting pressure on deal making and wealth management across the industry.
A blemish on Pick’s record that is yet to be resolved is Morgan Stanley’s role in a block-trading scandal. The bank is in the midst of trying to settle a probe into whether bankers shared details about impending share sales with favored clients before they were publicly disclosed.
Finance hasn’t been Pick’s only interest. As an undergrad at Middlebury College, he studied Russian history and politics.
Tom Nides, a former chief operating officer at Morgan Stanley, said Pick and his family visited him earlier this year in Israel while Nides was the U.S. ambassador. “He wanted to make an effort to say, ‘We are not going to Paris or London—I’m going to show you this really beautiful country,’” Nides said. “He wants his kids exposed to the world, not just New York.”
Morgan Stanley is in the midst of trying to settle a probe into whether bankers shared details about impending share sales with favored clients before they were publicly disclosed.
Pick started at Morgan Stanley in 1990 as an investment-banking analyst. He came in not knowing much about finance. He stayed after realizing that the industry would challenge him.
He later left to get an M.B.A. at Harvard and then returned. He spent most of the next 15 years in equity capital markets, which takes companies public and manages their stock sales.
He was later put in charge of the bank’s stock-trading arm, which had been badly damaged in the crisis. One client, Roberto Mignone, founder of Bridger Management, sent Pick a replica of the Titanic. Pick displayed it in his office.
“Keeping the modesty in the middle of the congratulations” is how Mignone described his gift.
“He kept it in the office for years and it was enormous,” he added.
Mignone, a Morgan Stanley shareholder, said he knew all along that Pick’s ship wouldn’t sink. He helped rebuild relationships frayed by the firm’s near-collapse. In the office, Pick insisted on keeping an armchair once used by a predecessor, John Havens. The chair had been in storage; Pick had it brought out in honor of his mentor.
Havens said he thought often that Pick had what it took to be CEO.
When Pick was later asked to grow the fixed-income business, he called the equities team into a room. “Make sure you guys continue to be No. 1!” he yelled. Some were angry. Others thought it was Pick’s way of making sure they didn’t drop the ball.
A dark moment for Morgan Stanley came when Archegos Capital Management imploded in 2021. Morgan Stanley lost $911 million. Pick laid out for the board where his team had gone wrong and what he would do differently.
Ted Pick studied Russian history and politics. in college. PHOTO: JEENAH MOON/BLOOMBERG NEWS
Even supporters say Pick can be a hothead, and it isn’t rare for him to go off on subordinates. But friends say he has also mellowed with age. He can make an effort to try to work things out afterward, sometimes circling the block around the bank’s offices in Midtown Manhattan with a colleague he has just yelled at.
He can also be harsh with employees who show even a whiff of disloyalty to the bank or to his direct reports. Those who criticize his close circle of key executives can eventually find themselves out of a job, according to people familiar with the matter.
Current and former executives say Pick is both feared—they know to be on their game when they meet with him—and respected. He holds regular meetings with managing directors where he gets into the weeds on deals they are working on.
Supporters say he likes to help deputies work out problems for themselves. Sometimes, if a deputy mentions an idea that he dislikes, Pick is known to lie on the couch in his office, look at the ceiling and say, “Wait, I don’t understand how this would pan out.”
The idea is to get the colleague to think through different scenarios and then conclude on their own that the idea doesn’t make sense. Colleagues say he would rather run through every scenario before a decision than deal with a post mortem.
On his coffee table, among an array of books, is former CEO John Mack’s memoir. In the depths of the financial crisis, Pick regularly rode the elevator up to the 40th floor to update Mack on how the bank’s shares were doing.
In years past, deputies often avoided his office in the evening hours when they were trying to head home, walking a longer way to the elevator instead. Those who didn’t often heard Pick ask them to come into his office to talk about the day—only to emerge an hour or more later.
