NEW YORK - Morgan Stanley plans to rename its retail-brokerage joint venture - now called Morgan Stanley Smith Barney - as soon as early next year, according to two financial advisers who heard remarks made by a top executive earlier this month.
Morgan Stanley Smith Barney President Gregory Fleming told a few hundred brokers and money managers about the timetable for a brokerage name change at the Association of Professional Investment Consultants conference, an intra-organizational meeting, in Salt Lake City, Utah, on June 7, said the advisers, who attended the event.
Once the name change is finalized, Morgan Stanley will ramp up its marketing of the brokerage's brand, which has been somewhat limited in recent months, according to advisers who heard Fleming's comments at the dinner.
"They realized they are falling behind on advertising, but are waiting for the name change to go through," said another broker, in the northeast U.S., who recently attended a meeting with top management.
A Morgan Stanley spokesman declined to comment for this story. Citigroup Inc., which owns a minority stake in the venture, also declined to comment.
A new identifier for Morgan Stanley Smith Barney is a key priority for the investment bank, which needs to keep pace with rivals including Bank of America Corp.'s Merrill Lynch Wealth Management in promoting itself to existing and potential clients.
With Wall Street looking to boost profits by cutting costs, it also doesn't make sense for Morgan Stanley to spend excessively on a brand name whose days could be numbered. The firm, like many big banks facing tepid revenue, is in the midst of cutting costs, down to the level of keeping a close watch on employees' usage of their Research In Motion Ltd. BlackBerry devices. Overall, Morgan Stanley is targeting roughly $500 million in annual cost savings beginning in 2012, which could jump to $1 billion over the next three years.
A name change for the 17,800-member advisory force likely means the end of the road for the 73-year old Smith Barney name, which survived the financial crisis and several corporate marriages in the last 30 years alone.
Morgan Stanley, which owns a 51% stake in Morgan Stanley Smith Barney, purchased a controlling stake in the joint venture nearly two years ago, as Morgan Stanley and Citigroup limped out of the financial crisis.
In March, Dow Jones Newswires reported that some brokerage clients were asked for their preference among six potential names for the business, none of which included Smith Barney.
Those new names for the unit, which is essentially Morgan Stanley's entire wealth-management unit, include Morgan Stanley Advisors, Morgan Stanley Private Wealth Advisors, Morgan Stanley Global Wealth Advisors, Morgan Stanley Wealth Advisors, Morgan Stanley Wealth Management and the familiar Morgan Stanley Global Wealth Management - its name before the deal with Smith Barney closed on June 1, 2009.
The investment bank can begin buying the rest of Citigroup's 49% stake in the brokerage in three installments starting in May 2012.