Gorman looks to the up-market advisory world - and makes an interesting choice. Donald Herrema is stepping down as CEO of Loring Ward to lead Morgan Stanley's high-end wealth-management business in the U.S. and Latin America. He replaces Michael McVicker, former head of U.S. private-wealth management, who will become COO of the company's U.S. and Latin American private-client businesses, a role that does not put him under Herrema, however.

Robert Hermann, New York-based Loring Ward's erstwhile number two, has been named president and CEO of the the Canadian wealth manager's New York-based U.S. operations. That takes effect on 1 May, when Herrema starts work at Morgan Stanley.

Just what they need

James Gorman, president of Morgan Stanley's Global Wealth Management Group, seems to view Herrema's appointment as a way to build out business in the $20-million-and-up "high-wealth" market.

"We are committed to building the leading ultra-high-net-worth business within a more fully-integrated Global Wealth Management Group," Gorman writes in a memo emailed to Morgan Stanley staffers yesterday. "This is a critical business for us, and we intend to grow it meaningfully under Don's leadership."

Fine plans for sure, but then Herrema isn't especially noted for his skills in client service or team building, say two very successful New York-based wealth managers who spoke to FWR separately and on the condition of anonymity - and with the clear understanding that neither can be counted among Herrema's admirers.

After thirteen years with Wells Fargo - including stints as head of its mutual-fund and retail-brokerage businesses - and five years with Bessemer Trust, latterly as CEO, Herrema joined AMVESCAP early in 2001 to run the Anglo-U.S. fund company's wealth-management business, soon re-named "Atlantic Trust."

Late in 2003 Herrema led AMVESCAP's acquisition of Boston-based Stein Roe Investment Counsel from Putnam Lovell for $118 million up front plus another $43 million contingent on Stein Roe's management meeting unspecified client retention and revenue goals. Putnam Lovell had paid around $40 million for Stein Roe in 2000.

Despite - or because of - marketplace murmurings about the high price paid for Stein Roe, AMVESCAP took Herrema off the helm of its wealth-management subsidiary within months of the deal's close and put him in charge of "strategic planning for mergers and acquisitions" - an appointment that seems to have yielded little.

Now pull the other one

Late in 2004 Herrema hopped over to Loring Ward, a Canadian wealth manager that was keen to soften its reliance on celebrity management and move its operational headquarters from Winnipeg, Manitoba, to New York.

Loring Ward didn't respond to a request for a comment on Herrema's departure.

Morgan Stanley also declined to comment.

Bessemer couldn't be reached. FWR was dying to ask Bessemer about Gorman's claim in the staff memo that "under [Herrema's] leadership, Bessemer grew from less than $10 billion in assets under management to nearly $40 billion" - a claim FWR views as dubious.

Gorman is new to Morgan Stanley, having arrived in February. Formerly head of Merrill Lynch's retail brokerage business, he now runs Morgan Stanley's retail brokerage and its higher-touch private-client advisory businesses.

But he has lost little time in making his mark, re-naming the business unit he heads (Global Wealth Management used to be the Individual Investor Group), assuming responsibility for sales as well as overall management, putting several of his old Merrill colleagues into leadership slots at Morgan Stanley and seeing off or reassigning more than a few old hands.

In Morgan Stanley's 2005 Annual Report, the company's brass specifies Gorman - who'd been named to his present job last August - as one of its main assets in a bid to turn a lackluster private-client business back to profitability and prestige. -FWR

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