James Gorman was chosen as the future chief executive of Morgan Stanley for his management skills and strategic expertise rather than to signal a shift away from the company's trading business, observers say.

Analysts are worried about his lack of investment banking experience. But Gorman told employees in a town hall meeting Friday, according to one who attended: "The heart, the DNA, the fabric of this place has always been the institutional securities business and, frankly, should always be the institutional securities business."

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