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Morgan Stanley names managers for Smith Barney joint venture

Andy Saperstein, Morgan Stanley’s national sales head, will run U.S. wealth management at MSSB

By Staff report

April 13, 2009 5:14 pm ET

Morgan Stanley will have majority control of the retail brokerage joint venture it is establishing with Citigroup’s Smith Barney, and the management lineup it announced Monday makes it clear that it will be running the show.

Andy Saperstein, Morgan Stanley’s national sales head, will run U.S. wealth management for the combined firm, overseeing branch office sales, recruiting and professional development, according to a internal memo issued today by James Gorman and Charles Johnston of Morgan Stanley Smith Barney of New York.

The deal is expected to close in the third quarter.

Michael Armstrong, Morgan Stanley’s global head of private wealth management, will have a similar international role at the combined unit and will also be in charge of integrating Citigroup Inc.’s family office business into the larger combined brokerage.

The firms previously announced that Morgan Stanley co-president James Gorman will be chairman of the joint venture, which will be the world’s largest retail broker with about 20,000 financial advisers, and that Smith Barney president and chief operating officer Charles Johnston will serve in the same role at the joint venture.

Mr. Saperstein is a valued lieutenant of Mr. Gorman; both worked together at Merrill Lynch & Co. Inc. of New York when Mr. Gorman was head of its retail brokerage.

Raymond Harris, a longtime Morgan Stanley executive who preceded Mr. Gorman, will be a vice chairman of the company, coordinating recognition clubs for top brokers and other functions.

Smith Barney, to be sure, hasn’t been shut out of the management structure.

Besides Mr. Johnston, who will be chief operating officer, Paul Hatch will run investment products and markets, including the investment advisory services arm at Smith Barney and the consulting services group at Morgan Stanley, the memo said.

He has a similar role today at the Citigroup unit.

Smith Barney’s James Tracy will report to Mr. Hatch as day-to-day head of investment advisory services, similar to his current role.

Craig Pfeiffer, currently head of high-net-worth clients at Smith Barney will be in charge of marketing and “client experience,” according to the e-newsletter FundFire.

Morgan Stanley’s product group head, Doug Ketterer, will be chief operating officer of the U.S. wealth management organization, it reported.

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