Gorman on McColgon – The New Guard at Morgan Stanley GWM

Matt Smith

1 February 2008

The incoming head of Global Wealth Management at Morgan Stanley, Ellyn McColgon, will use her experience in the registered investment advice and retirement industry to change the trajectory of the Wall Street brokerage firm – so elucidated Morgan Stanley co-president James Gorman at an investor conference this week. Ms McColgon, formerly president of distribution and operations for US fund management giant Fidelity Investments, will officially start as GWM head at Morgan Stanley in April. She replaced Mr Gorman, who was promoted to co-president late last year. “She is a very accomplished executive who brings a level of capability and experience we don’t have in the business,” Mr Gorman said at Citigroup's 2008 Financial Services Conference in New York. “She is one of the former top three executives at Fidelity… with a particular strong background in operations technology, the retirement space and the RIA space – all of the things I hope she will bring to the team,” he said. Mr Gorman, who will continue to oversee the Wealth Management and Asset Management division of Morgan Stanley, said GWM would focus its growth efforts in particular on Latin America, India, China and the Middle East in 2008. Recent results indicated the firm intended to grow its advisor numbers, despite having cut advisor numbers in recent years because of poor productivity. From employing a peak of 14,000 advisors in 2001, Morgan Stanley cut the bottom 20-25 per cent producers in an effort to increase margins on the business. The forth quarter results showed a 6 per cent increase in adviser head count from 7,900 at the end of 2006, to 8,400 at the end of 2007. In addition to growing the business in developing countries as mentioned, Mr Gorman said there was a lot of potential to bring on new advisors in the US this year as well. “Morgan Stanley, through its Dean Witter roots, actually has a low presence in the major metropolitan markets … We aspire to be the firm of choice for million dollar producers,” he said. Ms McColgan, 53, was announced as GWM head at Morgan Stanley after a 17-year career at Fidelity Investments. In her most recent position she was responsible for the firm’s retail and institutional distribution channels as well as core processing operations in the US and India, representing 21,000 employees and more than $1.5 trillion in client assets under administration. Prior to her most recent position at Fidelity she served as president of the firm’s brokerage company, the largest such company in the US based on client assets and accounts. Ms McColgan is currently on a sabbatical from Fidelity and is due to start with Morgan Stanley on 1 April.