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Company type | Private |
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Industry | Financial services |
Founded | 2009 |
Founder | Henry S. Morgan, Harold Stanley, Charles D. Barney, Edward B. Smith |
Headquarters | , U.S. |
Area served | Worldwide |
Key people | James P. Gorman (chairman) |
Products | Retail brokerage, asset management, investment banking |
Revenue | US$17,242 billion (2018) |
US$4,521 billion (2018) | |
US$3,472 billion (2018) | |
AUM | US$2.05 trillion (2014) |
Number of employees | 17,646 (2011) |
Parent | Morgan Stanley |
Website | www |
Morgan Stanley Wealth Management is an American multinational financial services corporation specializing in retail brokerage. It is the wealth & asset management division of Morgan Stanley. On January 13, 2009, Morgan Stanley and Citigroup announced that Citigroup would sell 51% of Smith Barney to Morgan Stanley, creating Morgan Stanley Smith Barney, which was formerly a division of Citi Global Wealth Management. The combined brokerage house has 17,646 financial advisors and manages $2 trillion in client assets. [1] Clients range from individual investors to small- and mid-sized businesses, as well as large corporations, non-profit organizations and family foundations.
On September 25, 2012, Morgan Stanley announced that its U.S. wealth management business was renamed "Morgan Stanley Wealth Management". The broker-dealer designation for Morgan Stanley Wealth Management will remain "Morgan Stanley Smith Barney LLC". [2]
Smith Barney & Co. was formed in 1938 through the merger of Charles D. Barney & Co. and Edward B. Smith & Co. Charles D. Barney & Co., a New York and Philadelphia based firm, was founded by Charles D. Barney in 1873 following the failure of its predecessor Jay Cooke & Company. Edward B. Smith & Co., founded in 1892 became a significant player in securities underwriting in 1934 when the firm absorbed the professionals from the securities business of Guaranty Trust Company, following the passage of the Glass Steagall Act. [3]
In 1975, Smith Barney merged with Harris, Upham & Co. to form Smith Barney, Harris Upham & Co., which, in 1977, was placed under SBHU Holdings, a holding company. In 1982, SBHU Holdings was renamed Smith Barney Inc. [4] During the 1980s, the company was known for its television commercials featuring actor John Houseman, with the catchphrase, "They make money the old-fashioned way. They earn it." [5] After Houseman stepped down, the campaign continued with various actors, such as Leo McKern, Joel Higgins and George C. Scott.
In the late 1980s, the retail brokerage firm Smith Barney was owned by Sanford I. Weill's Primerica Corporation. Commercial Credit purchased Primerica in 1988, for $1.5 billion ($3,864,378,165 today). In 1992, they paid $722 million ($1,567,614,892 today) to buy a 27% share of Travelers Insurance and in 1993 acquired Shearson (which included the legacy business of E.F. Hutton) from American Express. By the end of 1993, the merged company was known as Travelers Group Inc.[ citation needed ] although the brokerage business continued to operate under the Smith Barney brand.
In 1993, Weill bought stockbroker Shearson back from American Express for $1 billion ($2,109,191,431 today), and merged it into Smith Barney. [6] [7] (Weill had been in charge of Shearson Loeb Rhoades and sold it to American Express in 1981. [8] ) Weill offered Joe Plumeri the presidency of Smith Barney, and he became the President of the merged company that year. [6] [9] [10] He only lasted a year, as he experienced conflicts with existing Smith Barney managers. [6]
In September 1997, Travelers acquired Salomon Inc. (parent company of Salomon Brothers Inc.), for over $9 billion ($17,082,089,552 today) in stock, and merged it with its own investment arm to create Salomon Smith Barney. [11] In April 1998 Travelers Group announced an agreement to undertake a $76 billion ($142,069,416,088 today) merger between Travelers and Citicorp, creating Citigroup, which at the time of the merger was the largest single financial services company in the world.
At the time of the September 11, 2001, attacks, it was the largest tenant in 7 World Trade Center, occupying 1,202,900 sq ft (111,750 m2) (64 percent of the building) which included floors 28–45. [12] [13]
During the major financial crisis beginning in late 2008, Citigroup suffered large losses in its retained collateralized debt obligation exposure (loans that Citi underwrote but was not able to sell), and had to be rescued by the U.S. federal government. They decided to sell or close "non-core" businesses in order to raise money. On January 13, 2009, Morgan Stanley and Citigroup announced the merger of Smith Barney with Morgan Stanley's Global Wealth Management Group, with Morgan Stanley paying $2.7 billion cash upfront to Citigroup for a 51% stake in the joint venture. The joint venture operates as Morgan Stanley Smith Barney. [14] Morgan Stanley itself was in a financially cash-strapped position like Citigroup during that time, but they were helped by the $9 billion that Mitsubishi UFJ Financial Group had paid in 2008 for a 21% stake in Morgan Stanley. [15] [16] [17]
On June 1, 2009, Morgan Stanley and Citigroup announced they closed early on the launch of their joint venture that combines Morgan Stanley's wealth management unit (including many former Dean Witter assets) with Citi's Smith Barney brokerage division. The new venture, called Morgan Stanley Smith Barney, was supposed to launch during the third quarter. The combined entity generates about $14 billion in net revenue, has 18,500 financial advisors, 1,000 locations worldwide and serves about 6.8 million households. [18]
Citigroup disclosed on September 17, 2009, they would sell their remaining shares in the group to partner Morgan Stanley. [19]
The following is an illustration of the company's major mergers and acquisitions and historical predecessors (this is not a comprehensive list): [20]
Morgan Stanley Smith Barney (merged 2009) |
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Morgan Stanley is an American multinational investment bank and financial services company headquartered at 1585 Broadway in Midtown Manhattan, New York City. With offices in 41 countries and more than 75,000 employees, the firm's clients include corporations, governments, institutions, and individuals. Morgan Stanley ranked No. 61 in the 2023 Fortune 500 list of the largest United States corporations by total revenue and in the same year ranked #30 in Forbes Global 2000.
EF Hutton was an American stock brokerage firm founded in 1904 by Edward Francis Hutton and his brother, Franklyn Laws Hutton. Later, it was led by well known Wall Street trader Gerald M. Loeb. Under their leadership, EF Hutton became one of the most respected financial firms in the United States and for several decades was the second largest brokerage firm in the country.
Citigroup Inc. or Citi is an American multinational investment bank and financial services company in New York City. The company was formed by the merger of Citicorp, the bank holding company for Citibank, and Travelers in 1998; Travelers was spun off from the company in 2002.
Sanford I. "Sandy" Weill is an American banker, financier and philanthropist. He is a former chief executive and chairman of Citigroup. He served in those positions from 1998 until October 1, 2003, and April 18, 2006, respectively.
James Dimon is an American banker and businessman who has been the chairman and chief executive officer (CEO) of JPMorgan Chase since 2006.
Salomon Brothers, Inc., was an American multinational bulge bracket investment bank headquartered in New York City. It was one of the five largest investment banking enterprises in the United States and a very profitable firm on Wall Street during the 1980s and 1990s. Its CEO and chairman at that time, John Gutfreund, was nicknamed "the King of Wall Street".
Kuhn, Loeb & Co. was an American multinational investment bank founded in 1867 by Abraham Kuhn and his brother-in-law Solomon Loeb. Headed from 1885 onwards by Jacob H. Schiff, Loeb's son-in-law, it grew to be one of the most influential investment banks in the late-19th and early-20th centuries, financing America's expanding railways and growth companies, including Western Union and Westinghouse, and thereby becoming the principal rival of J.P. Morgan & Co.
Sallie L. Krawcheck is the former head of Bank of America's Global Wealth and Investment Management division and is currently the CEO and co-founder of Ellevest, a digital financial advisor for women launched in 2016. She has been called "the most powerful woman on Wall Street."
Dean Witter Reynolds was an American stock brokerage and securities firm catering to a variety of clients. Prior to the company's acquisition, it was among the largest firms in the securities industry with over 9,000 account executives and was among the largest members of the New York Stock Exchange. The company served over 3.2 million clients primarily in the U.S. Dean Witter provided debt and equity underwriting and brokerage as mutual funds and other saving and investment products for individual investors. The company's asset management arm, Dean Witter InterCapital, with total assets of $90.0 billion prior to the acquisition, was one of the largest asset management operations in the U.S.
The Travelers Companies, Inc., commonly known as Travelers, is an American insurance company. It is the second-largest writer of U.S. commercial property casualty insurance, and the sixth-largest writer of U.S. personal insurance through independent agents. Travelers is incorporated in Minnesota, with headquarters in New York City, and its largest office in Hartford, Connecticut. It has been a component of the Dow Jones Industrial Average since June 8, 2009.
Primerica, Inc. is a multi-level marketing company that provides insurance, investment and financial services to middle-income families in the United States and Canada.
Hayden, Stone & Co. was a major American securities firm founded in 1892 by Charles Hayden and Galen L. Stone. The firm was acquired by Cogan, Berlind, Weill & Levitt in 1972 and, after its name disappeared in 1979, was part of what would become Shearson/American Express in 1981.
Thomas (Tom) G. Maheras is an American finance executive that is currently a managing partner of Tegean Capital Management, LLC, a New York-based hedge fund.
Shearson was the name of a series of investment banking and retail brokerage firms from 1902 until 1994, named for Edward Shearson and the firm he founded, Shearson Hammill & Co. Among Shearson's most notable incarnations were Shearson / American Express, Shearson Lehman / American Express, Shearson Lehman Brothers, Shearson Lehman Hutton and finally Smith Barney Shearson.
Shearson, Hammill & Co. was a Wall Street brokerage and investment banking firm founded in 1902 by Edward Shearson and Caleb Wild Hammill. The firm originally built its business as a stock broker as well as a broker of various commodities, particularly grain and cotton. The firm was a member of the New York Stock Exchange, the Chicago Stock Exchange and the Chicago Mercantile Exchange.
Loeb, Rhoades & Co. was a Wall Street brokerage firm founded in 1931 and acquired in 1979 by Sanford I. Weill's Shearson Hayden Stone. Although the firm would operate as Shearson Loeb Rhoades for two years, the firm would ultimately be acquired in 1981 by American Express to form Shearson/American Express and three years later Shearson Lehman/American Express.
Cogan, Berlind, Weill & Levitt, originally Carter, Berlind, Potoma & Weill, was an American investment banking and brokerage firm founded in 1960 and acquired by American Express in 1981. In its two decades as an independent firm, Cogan, Berlind, Weill & Levitt served as a vehicle for the rollup of more than a dozen brokerage and securities firms led by Sanford I. Weill that culminated in the formation of Shearson Loeb Rhoades.
Joseph J. Plumeri II is vice chairman of the First Data Board of Directors. He was the chairman and CEO of Willis Group Holdings (Willis), a New York Stock Exchange-listed insurance broker, until July 2013. The company has 17,000 employees in 400 offices, located in 120 countries. As of June 2010, Willis had the third-highest insurance brokerage revenues in the world.
OneMain Holdings, Inc. is an American financial services holding company headquartered in Evansville, Indiana, with central offices throughout the United States. The company wholly owns OneMain Finance Corporation and its subsidiaries, through which it operates in the consumer finance and insurance industries as OneMain Financial. Its business primarily focuses on providing personal loans and optional insurance products to customers with limited access to traditional lenders, such as banks and credit card companies.
ClearBridge Investments (ClearBridge) is an equities focused asset management firm headquartered in New York City. It was previously the asset management unit of Citigroup until 2005 when it was rebranded as ClearBridge Investments. Currently it is a subsidiary of Franklin Templeton Investments.