Deals & People October 26, 2023

Morgan Stanley Promotes Co-President to Replace Gorman as CEO

Ted Pick will take the role in January, following James Gorman’s 13 year run.

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Morgan Stanley announced Wednesday that Co-President Ted Pick will replace James Gorman as CEO of the global financial services firm, which also runs retirement plan consultancy Graystone Consulting.

Gorman took the CEO role in 2010, replacing John Mack. He had announced his departure at the firm’s May annual shareholder conference, noting three potential successors without naming them.

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Pick, who will take over in January 2024 and also join Morgan Stanley’s board of directors, has been co-president for two years, serving as head of the institutional securities group overseeing investment banking, equities, fixed income, capital markets and research.

With the change, Morgan Stanley also announced that Andy Saperstein will take a role as co-president and head of wealth and investment management. He is currently overseeing all wealth management channels, including Morgan Stanley Financial Advisors, E*Trade and Morgan Stanley at Work.

In addition, Dan Simkowitz will be a co-president and head of institutional securities, taking over Pick’s prior role. Simkowitz is currently head of investment management and co-head of firm strategy and execution.

“The Board has unanimously determined that Ted Pick is the right person to lead Morgan Stanley and build on the success the firm has achieved under James Gorman’s exceptional leadership,” Tom Glocer, the board’s independent lead director, said in a statement. “Ted is a strategic leader with a strong track record of building and growing our client franchise, developing and retaining talent, allocating capital with sound risk management, and carrying forward our culture and values.”

Prior to his current role, Pick served as global head of sales and trading, including leading a turnaround of Morgan Stanley’s fixed-income division, according to the firm. Morgan Stanley also noted that Pick actively raised capital during the financial crisis.

“For several years I have worked with the Board to ensure an orderly succession, and I feel strongly that now is the time to step aside,” Gorman said in a statement. “I have worked side by side with Ted since the financial crisis and have experienced first-hand his values, intellect, passion and commitment to our people and our clients. He is battle-tested, understands complex risk, and works very effectively not just in the U.S., but around the globe.”

Gorman, 64, oversaw a push by the New York-based investment bank into wealth management and investment advice, with the investment management division staffed with 1,300 financial professionals overseeing $1.4 trillion in assets under management as of March 31.

Morgan Stanley’s Graystone Consulting, which provides retirement plan advisement to plan sponsors, is led by Jeremiah France, who was hired in 2020 from a position in wealth management with Mercer.

 

Products October 26, 2023

Candidly Launches Emergency Savings Solution

The education debt management platform expands with ‘more inclusive solution’ available as one of its SECURE 2.0-based retirement options.

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Candidly, an artificial intelligence-driven student debt and savings optimization platform, has launched an emergency savings solution that enables workers to activate automated features, such as setting up payroll deduction and rounding up spare change from everyday transactions to contribute to their emergency fund passively.

Candidly, which has been focused on educational debt management and payments, is making the new offering available to users as a workplace benefit through employers, recordkeepers and financial institutions, alongside the firm’s suite of student debt and SECURE 2.0 retirement savings enablement solutions.

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“Candidly’s emergency savings can be made available as a stand-alone solution directly to plan sponsors or embedded into a retirement plan adviser’s existing digital experience (often in collaboration with their preferred recordkeeper), offering a more inclusive solution that addresses the full wellness spectrum within the workplace,” Laural Taylor, CEO and co-founder of Candidly, says via email.

The idea of tying an easy-access emergency savings account to retirement savings gathered steam during the financial strains of the COVID-19 pandemic. The SECURE 2.0 Act of 2022 allows employers to make an emergency savings account part of a participant’s retirement plan in 2024, up to a maximum of $2,500. However, due to the operational complexity, Candidly found that demand was far greater for out-of-plan solutions and is servicing that out-of-plan demand for now.

Taylor says Candidly already has several partnerships in place with retirement plan advisers, with a “robust pipeline of plan advisers urgently seeking to respond to plan sponsor demand.”

“Similar to its student debt optimization platform, Candidly has developed deep relationships with retirement plan advisers and recordkeepers to bring emergency savings solutions to market that can direct savings into FDIC-insured, partner-preferred destinations,” Taylor says.

Candidly is also allowing current clients and participants to use custodial and/or deposit-based solutions that permit providers to integrate the emergency savings program into their own systems.

“By expanding offerings to include an emergency savings solution, Candidly provides an easy way for employees to redirect those dollars into emergency savings,” Taylor says. “In addition, this new solution is relevant even for those employees who do not have student loan debt and need to build toward a safety net. This enables Candidly to expand its total addressable market within the workplace with a relevant solution for 100% of the workforce.”

According to Taylor, a record number of American workers have taken a loan or hardship withdrawal from their retirement plan in 2022, translating to losses in retirement readiness, while participant debt has exploded to an all-time high.

Earlier this year, a study by the nonprofit Commonwealth and DCIIA, conducted as part of BlackRock’s Emergency Savings Initiative found that low-income households with at least $1,000 in emergency savings were half as likely as other households to withdraw money from workplace retirement savings accounts during the pandemic.

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