Morgan Stanley named Michael Levy head of traditional asset management, replacing Arthur Lev, who will become chairman of the investment-management division.
Levy, a 17-year veteran of the firm, was previously head of merchant banking and real estate investing capital markets, according to an internal memo obtained by Bloomberg News. Alternative Investment Partners, the fund of funds business that Lev also oversaw, will now report to Ed Moriarty, head of merchant banking and real estate investing.
Revenue from traditional asset management climbed 6 percent last year to $1.8 billion, while revenue from merchant-banking and real estate investing each dropped by a third as new rules limited the bank’s ability to invest its own money in those areas. The division produced about 8 percent of Morgan Stanley’s total revenue.
“Our business is central to Morgan Stanley’s strategy to diversify revenues and produce stable and predictable results over the long term,” Greg Fleming, who oversees the division as well as the firm’s brokerage unit, wrote in the memo. “As we pursue these opportunities, we continue to pay careful attention to leadership succession planning.”
Fleming has set a goal of increasing total assets under management to $500 billion by 2016. The unit had $403 billion at the end of 2014, up from $377 billion a year earlier.
Morgan Stanley has hired portfolio managers from buy-side firms to support that push. In November, the company added Jens Nystedt from Moore Capital Management LLC as a portfolio manager for emerging-market debt, and hired Greg Finck from Fortress Investment Group LLC for securitized products in January.
Lev previously held roles as chief strategy officer of the traditional asset-management unit and general counsel of Morgan Stanley Investment Management. He left Morgan Stanley in 2002 to join Greenwich, Connecticut-based FrontPoint Partners LLC, returning in 2006 when the bank bought the hedge fund.