Morgan Stanley hands new leaders tens of millions in restricted stock

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Morgan Stanley’s soon-to-be chief executive Ted Pick and his two top lieutenants were granted restricted stock units that could net them tens of millions of dollars each in connection with their new roles.

Morgan Stanley said the units, announced in an SEC filing on Friday afternoon, were awarded in equal amounts to the three executives: Pick, Andy Saperstein and Dan Simkowitz. Each package was worth $20mn at the time of the grant, but the final value will be determined by the performance of Morgan Stanley’s stock price over the next three years. The one-time grants will not fully vest until 2027.

Earlier this week, Morgan Stanley announced that Pick will take over as the firm’s chief executive next year, replacing James Gorman, who had held the top job at the bank for nearly 14 years. Gorman will then become executive chair.

Gorman’s announcement at the Morgan Stanley annual meeting earlier this year that he would retire kicked off a rare public run-off for one of the most coveted jobs on Wall Street. Saperstein and Simkowitz were also in the running for the top job but were instead given other senior roles.

It is standard pay practice for a newly named CEO of a Wall Street firm to get a large stock grant as they step into the role. It is less typical, however, to see similar awards to other executives. In 2021, for instance, David Solomon, who became CEO of Goldman Sachs in 2018, got a $30mn stock grant. Goldman’s second-highest ranking executive, John Waldron, received $20mn at the same time.

That same year, JPMorgan Chase granted its chief executive Jamie Dimon a “special award” of 1.5mn share options that were at the time projected to be worth $49.5mn after 10 years. On Friday, JPMorgan announced that Dimon would cash in as many as 1mn shares in the next year, which at the bank’s current stock price would be worth $140mn.

Gorman, Morgan Stanley’s outgoing chief executive, has sought to hand over the firm to its next generation of executives without the back-stabbing that executive transitions often entail. Before this week’s announcement, Gorman had praised all three executives and expressed hopes that they all would stay with the firm, no matter who was named as his successor.

This story has been amended to clarify that the executives were granted restricted stock units rather than options