Morgan Stanley CEO says major threat to banks are ‘stupidity of own management,’ AI
NY Post
Outgoing Morgan Stanley CEO James Gorman ripped banks’ “stupidity of their own management” as one of the top threats facing Wall Street — right alongside artificial intelligence.
When reflecting on his nearly 14-year tenure at Morgan Stanley to the Financial Times, Gorman — who has less than two weeks left at the firm — said that the banking system has become much safer, though the industry is still facing operational risks including its own top staffers.
This year, there were three high-profile bank collapses in the US — Silicon Valley Bank, Signature Bank and First Republic — all of which Gorman told FT were “entirely their own doing.”
The trio of banks had over $531 billion in combined assets under management — more than all 25 federally insured lenders that failed in 2008 at the onset of the Great Recession.
Gorman, 65, also pointed to Credit Suisse, which collapsed in early March but was scooped up by Switzerland’s UBS by the end of the month for more than $3 billion in an emergency deal.
He referred to the fiasco another example of operational risk management gone awry, according to FT.
