Morgan Stanley (MS) Chairman James Gorman expressed concerns regarding the proposed bank capital requirements set by federal regulators. In an interview with Bloomberg TV, Gorman stated that these requirements may undergo modifications before they are implemented. According to him, if the current form of the regulations were to be enforced, it would have detrimental consequences for corporate lending throughout the country, hindering economic growth.
Regulators introduced higher capital requirements for banks as part of the Basel III endgame regime, originally implemented in response to the financial crisis. The Federal Reserve released extensive new regulations over the summer, consisting of a 1,110-page document. The comment period, initially set to end on November 30, was extended until January 16.
Coinciding with these developments, James Gorman also announced his resignation as chief executive after 13 years, as part of a succession plan. Ted Pick is set to take over as the new chief executive of the investment bank. Following these announcements, Morgan Stanley’s stock experienced a 2% decline on Wednesday. However, despite this recent decrease, the company had a positive performance in 2023, with a year-end gain of 9.7%, in comparison to a 24.2% increase in the S&P 500 index (SPX).
