By Peter Rudegeair

Morgan Stanley on Thursday set up a four-way race to one day succeed Chief Executive James Gorman, elevating a number of senior executives into new roles as part of a broader management reshuffle.

Ted Pick, 52 years old, who leads the firm's investment-banking and trading businesses, and Andy Saperstein, 54, the head of wealth management, were named co-presidents of the bank.

Chief Financial Officer Jonathan Pruzan, 52, is moving into the role of operations chief, and Dan Simkowitz, 56, was given responsibility to help set Morgan Stanley's strategy and execution alongside his job as head of investment management.

All appointments are effective as of June 1.

Mr. Gorman, 62, is one of the longest-serving CEOs on Wall Street, getting the top job at Morgan Stanley in 2010. He recently told Morgan Stanley's board that he planned to stay in his post for at least three more years, according to a person familiar with the matter.

At the bank's annual shareholder meeting Thursday, Mr. Gorman said the management changes "reflect the next generation of leadership at Morgan Stanley."

Other banks have recently placed women in the top role or signaled that they will in the near future. At Citigroup Inc., Jane Fraser took over the CEO job this year, the first woman to run a major U.S. bank. At JPMorgan Chase & Co., two front-runners to succeed CEO Jamie Dimon are women. This week, the bank promoted them to jointly run the consumer and community bank.

In an interview, Mr. Gorman said the bank has "tremendous diversity on our team," particularly among executives in the ranks below the C-suite. Morgan Stanley on Thursday also promoted two female executives to top jobs: Sharon Yeshaya, head of investor relations, will replace Mr. Pruzan as finance chief. Shelley O'Connor, a longtime Morgan Stanley executive, will become a vice chairman and head of external affairs.

Over his 11-year tenure as CEO, Mr. Gorman oversaw Morgan Stanley's recovery from a near-death experience during the 2008 financial crisis. He spent much of the past decade raising capital levels, slashing pay, exiting risky businesses and shrinking the trading operation.

Mr. Gorman also refashioned the bank into a steadier institution through a number of strategic deals. Morgan Stanley completed its acquisition of Smith Barney from Citigroup Inc. under Mr. Gorman, turning it into a powerhouse in wealth management. Last year, he struck deals to acquire E*Trade Financial Corp. and Eaton Vance Corp., expanding Morgan Stanley's footprint in retail investing and fund management, respectively.

Many of those new businesses, combined with strong activity in its Wall Street arms, helped Morgan Stanley generate record revenue of $48.2 billion last year. In response, Morgan Stanley's board of directors made Mr. Gorman the highest-paid big-bank boss earlier this year when it awarded him a $33 million pay package for 2020, up 22% from what he received for 2019.

At the start of 2021, Morgan Stanley was at an inflection point, Mr. Gorman told analysts at the time. After years of retrenchment and stabilization, it would now get more aggressive about gaining market share, expanding its client base and returning excess capital. Three months later, Morgan Stanley reported record revenue and profit but also revealed $911 million in trading losses tied to the implosion of Archegos Capital Management.

Mr. Gorman said in the interview that it was exciting to be in growth mode after years of retrenching. "You're getting to do almost a different job," he said. "It's very energizing."

Morgan Stanley shares have roughly tripled since Mr. Gorman took over, roughly in line with the increase in the KBW Nasdaq Bank Index. That is behind the stock rise of JPMorgan Chase & Co. over the same period, but better than Goldman Sachs Group Inc. All three banks have traded at or near records recently.

Mr. Gorman didn't hint at any favorites in the CEO race. ""Best practice is make changes from positions of strength, groom people internally and give the board choices," he said in the interview. "If you do that, let the chips fall where they fall."

But he also signaled that he isn't ready to leave yet. At the shareholder meeting, he said he looked forward to working with each of them "in the coming years."

Write to Peter Rudegeair at Peter.Rudegeair@wsj.com

(END) Dow Jones Newswires

05-20-21 1716ET