New Guard at Morgan Stanley Marks End of an Era

John Mack and Morgan Stanley have shared a few near-death experiences over the years. Mack, who will leave his post as CEO at the end of the year, is hailed by his fans as a hero for saving the investment bank from the brink of extinction in the financial crisis. Others bestow high marks for resurrection of the bank and morale after the troubled 1997 merger with Dean Witter that threatened the firm’s success.

But it was Mack’s penchant for amping up risk and increasing the firm’s appetite for trading and risky mortgages that nearly ruined his legacy. No surprise then that his successor James P. Gorman is cut from a different cloth. The bank Gorman inherits is still in flux and is morphing into a tamer version of its former self. The bank is no longer one that would even consider hiring someone of John Mack’s ilk to run it as CEO.