A new generation is taking over the top jobs on Wall Street.
When the 54-year-old Ted Pick becomes Morgan Stanley’s (MS) new CEO on Jan. 1, replacing the 65-year-old James Gorman, four of the biggest banks in the US will be run by people who were not in charge during the 2008 financial crisis — or its aftermath.
Three of them — Pick, Citigroup (C) CEO Jane Fraser, and Wells Fargo’s (WFC) Charlie Scharf — are in their 50s. Another new CEO of a smaller investment bank, Lazard’s (LAZ) Peter Orszag, is also in his 50s. Goldman Sachs’ (GS) David Solomon, who took over in 2018, is 61.
Morgan Stanley’s succession announcement on Wednesday leaves just two CEOs of giant national banks with sharp memories of what it was like to be the boss during the worst financial crisis since the Great Depression: JPMorgan Chase's (JPM) Jamie Dimon and Bank of America’s (BAC) Brian Moynihan.
And only Dimon, who became CEO in 2005, was there when the crisis started. Moynihan was selected in late 2009 — as the Charlotte, N.C.-based bank struggled to put the housing meltdown behind it — and took over in January 2010.
Dimon, 67, and Moynihan, 64, are both now of retirement age. It is not clear when either will leave, but both have dropped some hints.
"I can’t do this forever, I know that," Dimon told analysts on May 22. "But my intensity is the same. I think when I don't have that kind of intensity, I should leave."
The list of candidates, according to a person familiar with the bank's succession planning, includes longtime JPMorgan executive Daniel Pinto, who could step in if something went wrong suddenly.
If Dimon stays another three to five years, two consumer-banking bosses are considered frontrunners to succeed him: Marianne Lake and Jennifer Piepszak. Other executives could get consideration if Dimon stays longer.
It is possible Dimon could stay several more years. The board has made it clear it wants him running the bank that much longer.
The clue is a special retention bonus of 1.5 million options the board awarded Dimon in 2021. He can't exercise those options until 2026, and he has to stay at the bank the entire time while meeting certain performance targets unless he is elected to public office.
Moynihan, at Bank of America, has said little about his plans. He is already older than his predecessor Ken Lewis was (62) when Lewis announced in September 2009 that he would be stepping down, setting off a scramble to replace him.
After Moynihan got the job his early years at Bank of America were rocky as the bank struggled to recover from the aftershocks of 2008.
It took a $5 billion injection from Omaha billionaire Warren Buffett in 2011 and an implicit endorsement from the "Oracle of Omaha" — Buffett called Bank of America a "well-led" company — to quiet Moynihan's early critics and stabilize the company's stock.
A decade later, when Bank of America promoted several executives to new jobs, Moynihan made it sound like any race to take his place could still be drawn out.
In a 2021 letter to employees that explained the promotions, the CEO said the bank’s new leadership would be there alongside him to execute on a strategy he started in 2010 "through its second decade, with me and with all of you." That implied he might be in the job for many more years.
When asked about that during a television interview on Bloomberg in December 2022, Moynihan said, "I expect to run this company as long as the board will let me, but they have a day-to-day contract. They can let me go tomorrow. That's the way it works."
He added: "I expect I'll do this job, it's the best job in the world, for as long as they have me."
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