HEAD OF GLOBAL
MANAGING DIRECTOR, HEAD OF RETAIL
BANKING, MORGAN STANLEY
Favorite pastimes: Riding my horses
and showing in dressage competitions
Children: Two (ages 24 & 29)
Last book read: House of Cards
Last movie seen: “Mama Mia”
Charity most active in: The United Way
One thing on “bucket” list: Earn my
Gold Medal in Dressage
Top non-business concern: Health care
Few women in banking draw as much attention as Sallie Krawcheck.
A mainstay on lists of powerful women,
Krawcheck joined Bank of America Corp. in
August to take over its brokerage and wealth
management operations. She will play a critical role in maximizing profits from BofA’s purchase of Merrill Lynch, which in turn could
raise her stature within the company.
Krawcheck is widely perceived to be in the
running to succeed Kenneth Lewis as the $2.3
trillion-asset Charlotte company’s chief executive.
Krawcheck, 44, has long possessed a certain celebrity aura, gaining prominence and
respect first as the chairman and CEO at Alliance Capital Management’s Sanford C. Bernstein & Co. and later running the global wealth
management division at Citigroup Inc.
Her meteoric rise seemed to end after Citi
CEO Charles Prince was forced out in 2007;
she left a year later after a reported rift with
Prince’s successor, Vikram Pandit.
Frank Barkocy, the director of research at
Mendon Capital Advisors, says the independ-ent-minded Krawcheck has a chance to firmly
re-establish herself within the industry in a
new, though familiar, role. “She is starting
back at the same level, if not a higher, than the
one she left,” he says.
Krawcheck manages 14,000 brokers and
oversees a division with more than $700 million in assets under management, and she will
have to strike a balance between the divergent
cultures at Merrill Lynch and Bank of America
while keeping defections to a minimum.
A day after she walked into the New York
office, Dan Sontag announced his retirement
as the head of the company’s wealth management unit.
“She has a huge job ahead of her to restore
morale at Merrill and stem the bleeding of key
sales people,” says Marshall Front, the chairman of Front Barnett Associates, a Chicago investment firm.
Krawcheck clearly sees herself as a bridge
between the two cultures, making that point
clear in a video issued to the brokers soon after
“I’m a southerner by birth, but a northerner for some number of years,” she says.
“What I’m not going to do is turn this into a
place I’ve been before. Those are great institutions but this is a fantastic business.”
In September 2008, the Federal Reserve Board
approved Morgan Stanley’s application to become a bank holding company. The investment
bank highlighted its new access to the Fed’s discount window “and other funding opportunities.” Morgan Stanley’s Utah-based industrial
bank became a national bank. The company
vowed to expand the retail banking services offered to its retail customers and build its core
deposits from an Aug. 31, 2008 base of $36 billion.
Then in November of last year, it announced
the appointment of Cece Sutton as president of
the new retail banking group. Bank deposits
grew to $46.8 billion by the end of the first
quarter of 2009. By the end of June deposits
had more than doubled to $105.7 million.
A lot of that growth was the result of the
completion of the Morgan Stanley Smith Barney joint venture, but Sutton had already been
building Morgan’s retail banking business organically, and plans to both hire staff in New
York and Charlotte and use Morgan Stanley
Smith Barney offices as touch points from
which to market an array of existing and new
retail products to the joint venture’s clients.
“Cece is a natural leader who digs into the
details and really understands the products,”
says James Gorman, the chairman of Morgan
Stanley Smith Barney. “She has an operations
mentality and doesn’t mind getting dirty under
Her area of oversight reflects the breadth of
responsibilities Gorman’s comment suggests.
Sutton is responsible for building all aspects of
retail banking for the firm’s customers, including deposits, loans, the credit and debit card
business, and mortgages. She was recently
handed responsibility for managing Morgan
Stanley’s trust company, as well. The retail
banking arm is about to introduce jumbo mortgages, home equity loans, and tailored lending,
Sutton notes. It’s also delving into middle-mar-ket and small-business lending.
Analysts speculate that a deal would be the
logical next step but for now Sutton is talking
about a focus on the existing customer base.
“We’re building business with these customers,”
she says. “We started with some very fundamental products, creating a retail operation from
scratch, adding all the infrastructure and IT. After a great early start, now we’re working toward
a full banking product line-up for one of the
largest wealth management bases in the business.” —Joseph Rosta
SURE IT WAS PAINFUL, BUT THE
TUMULT OF THE LAST 12 MONTHS
HASN’T SLOWED DOWN THESE 25
WOMEN. WHETHER IN NEW POSI-
TIONS OR OLD ONES, THEY ARE
POISED TO PLAY LEADING ROLES
IN THE INDUSTRY’S RECOVERY.