In the final and maybe most difficult step of CEO James Gorman's drive to cut staffing costs across Morgan Stanley (MS), the bank is considering reductions in pay to its wealth managers, reports Reuters.
At the moment, writes reported Lauren Tara LaCapra, changes at the margin are being looked at like cutting pay for those brokers generating the smallest amount of revenue, and slashing the amount of money used to lure experienced rainmakers.
Cutting pay to brokers is more easily said than done because even mid-level advisers are in high demand and can jump ship, usually taking loyal customers with them.
Gorman has previously stated his goal of paying 55% or less of wealth management revenues to brokers vs. 60% today. A move that large would save $884M in costs next year.