April 29 (Bloomberg) -- Morgan Stanley, owner of the world’s largest brokerage, hired Michele Davis, who held communications roles at George W. Bush’s White House and Henry Paulson’s Treasury Department.
Davis will join as a managing director and global head of corporate affairs, Chief Executive Officer James Gorman and Vice Chairman Tom Nides wrote in a memo to employees today. In her last government position, Davis helped Paulson’s team as they crafted the $700 billion Troubled Asset Relief Program, which used taxpayers’ money to rescue lenders from collapse during the credit crisis.
Wall Street firms have hired executives with political experience since the crisis as they seek to navigate new regulations that may crimp profit while fending off probes from watchdog agencies. Goldman Sachs Group Inc. and Credit Suisse Group AG hired former Treasury officials Richard L. “Jake” Siewert Jr. and Calvin Mitchell III, respectively, for senior communications roles last year.
“Michele’s extensive experience will serve the firm well,” they wrote. “Michele has worked at the nexus of political and financial media throughout her career.”
Gorman has positioned New York-based Morgan Stanley to rely more on wealth-management fees and less on the risky trading and real-estate deals that forced Morgan Stanley to borrow $10 billion from the TARP program in 2008. He has sought to convince investors that the firm is more stable and laid out a plan to double return on equity without an improvement in markets.
Davis joins Morgan Stanley from the Brunswick Group, a New York-based public relations firm. She was among the executives used by BP Plc to help manage the fall-out from the 2010 Gulf of Mexico oil spill. She acted as a spokeswoman for Republican Mitt Romney in his failed presidential bid last year.
Her last job under Paulson in Treasury was assistant secretary for public affairs and director of policy planning, according to today’s memo. She was a “senior member” of the team that faced the credit crisis in 2008, Morgan Stanley said. Davis was played by the actress Cynthia Nixon in the HBO version of Andrew Ross Sorkin’s book “Too Big to Fail.”
Morgan Stanley was among Wall Street banks including Citigroup Inc. and Goldman Sachs grappling with losses tied to subprime mortgages as defaults on home loans mounted.
To avoid collapse after Lehman Brothers Holdings Inc. went bankrupt, Morgan Stanley converted to a bank, arranged to sell a stake of the company to Japan’s Mitsubishi-UFJ Financial Group Inc. and took the Treasury bailout. The firm later repaid the rescue with interest.
Morgan Stanley also borrowed $107.3 billion from the Federal Reserve, the most of any bank, according to data compiled by Bloomberg News.
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