CEO Purcell stepping down

Monday, June 13, 2005 | 11:10 a.m.

NEW YORK -- Morgan Stanley CEO Philip J. Purcell, acknowledging that calls for his ouster and a string of top-level defections have hurt the Wall Street investment bank, said today he will retire as soon as a successor can be found.

The announcement came as Morgan Stanley also warned that its second-quarter earnings would fall about 15 percent to 20 percent from the first quarter of 2005.

News of Purcell's planned retirement came three days after nine stock traders left the company, the latest in a series of departures by employees dissatisfied with Purcell's management style. The resignations, which began in late March, had led a group of dissident shareholders and former executives to publicly call for Purcell's firing and a reorganization at Morgan Stanley.

That, Purcell said, led to a "sideshow" that distracted the company from its business goals.

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