John J. Mack
Encyclopedia
John J. Mack is the current Chairman of the Board at Morgan Stanley
, the New York
-based investment bank and brokerage firm. Mack announced his retirement as Chief Executive Officer
on September 10, 2009, which was effective January 1, 2010. Former Co-President James P. Gorman
succeeded him as CEO.
immigrants of Melchite and Greek Orthodox origin. His father, Charles, came to America at the age of 12, following his father who had arrived at Ellis Island
in 1908 and had settled in North Carolina
. Charles ran a wholesale grocery store in Mooresville, N.C.
Mack graduated from Duke University
in 1968, where he attended on a football
scholarship and is now a member of the Board of Trustees.
Mack's first job in finance was as a clerk at a small brokerage house during his junior year at Duke, after a cracked vertebra made it impossible for him to continue on his football scholarship.
, of which Purcell was already CEO. Mack took on the CEO position at Credit Suisse First Boston
(CSFB) six months after that time.
He earned the nickname Mack the Knife for his cost-cutting prowess while managing the fixed income division at Morgan Stanley, and he lived up to his billing at CSFB, where he cut 10,000 jobs and returned the bank to profitability.
Mack returned to Morgan Stanley on June 30, 2005 as chief executive officer and chairman of the board, replacing Purcell. Mack was noted for stabilizing the firm and reenergizing its culture and client franchise.
investigator Gary J. Aguirre
of insider trading
. On October 5, 2006, the SEC recommended no action be taken against Mack. http://www.businessweek.com/ap/financialnews/D8KIOU380.htm In late November 2006, Mack and Pequot were notified that the investigation had been closed and no action would be taken against them.
In 2008, he earned a total compensation of $1,235,097, which included a base salary of $800,000 and other compensation of $435,097. He did not receive any cash, stock, or options.
to sell Morgan Stanley. He has stated that during negotiations he was under considerable pressure from the president of the New York Federal Reserve, Tim Geithner, to sell or merge Morgan Stanley to one of his competitors such as JP Morgan. Mack saw this as being contrary to the interests of Morgan Stanley shareholders and employees, similar to the demise of Bear Stearns
in a forced sale to JP Morgan for $2 per share, (the deal was later revised to $10 a share), and insisted on finding other sources of financing instead.
, the International Business Leaders Advisory Council for the Mayor of Beijing
, the International Advisory Panel of The Monetary Authority of Singapore
, and the executive committee of the Partnership for New York City. In 2005, the C.J. Mack Family Foundation provided an endowment arranged by Mack to the United States Naval Academy Foundation to support the Admiral Frank Bowman
Scholar Program.
Morgan Stanley
Morgan Stanley is a global financial services firm headquartered in New York City serving a diversified group of corporations, governments, financial institutions, and individuals. Morgan Stanley also operates in 36 countries around the world, with over 600 offices and a workforce of over 60,000....
, the New York
New York City
New York is the most populous city in the United States and the center of the New York Metropolitan Area, one of the most populous metropolitan areas in the world. New York exerts a significant impact upon global commerce, finance, media, art, fashion, research, technology, education, and...
-based investment bank and brokerage firm. Mack announced his retirement as Chief Executive Officer
Chief executive officer
A chief executive officer , managing director , Executive Director for non-profit organizations, or chief executive is the highest-ranking corporate officer or administrator in charge of total management of an organization...
on September 10, 2009, which was effective January 1, 2010. Former Co-President James P. Gorman
James P. Gorman
James P. Gorman has been CEO of Morgan Stanley since 1 January 2010. He was formerly Co-President and Co-Head of Strategic Planning at the firm.- Business career :...
succeeded him as CEO.
Early life and education
Born in 1944, Mack was the sixth son to LebaneseLebanon
Lebanon , officially the Republic of LebanonRepublic of Lebanon is the most common term used by Lebanese government agencies. The term Lebanese Republic, a literal translation of the official Arabic and French names that is not used in today's world. Arabic is the most common language spoken among...
immigrants of Melchite and Greek Orthodox origin. His father, Charles, came to America at the age of 12, following his father who had arrived at Ellis Island
Ellis Island
Ellis Island in New York Harbor was the gateway for millions of immigrants to the United States. It was the nation's busiest immigrant inspection station from 1892 until 1954. The island was greatly expanded with landfill between 1892 and 1934. Before that, the much smaller original island was the...
in 1908 and had settled in North Carolina
North Carolina
North Carolina is a state located in the southeastern United States. The state borders South Carolina and Georgia to the south, Tennessee to the west and Virginia to the north. North Carolina contains 100 counties. Its capital is Raleigh, and its largest city is Charlotte...
. Charles ran a wholesale grocery store in Mooresville, N.C.
Mooresville, North Carolina
Mooresville is a large suburban town in southern Iredell County, North Carolina, USA. It is in the Metrolina metro area. The population was 32,133 at the 2010 United States Census...
Mack graduated from Duke University
Duke University
Duke University is a private research university located in Durham, North Carolina, United States. Founded by Methodists and Quakers in the present day town of Trinity in 1838, the school moved to Durham in 1892. In 1924, tobacco industrialist James B...
in 1968, where he attended on a football
American football
American football is a sport played between two teams of eleven with the objective of scoring points by advancing the ball into the opposing team's end zone. Known in the United States simply as football, it may also be referred to informally as gridiron football. The ball can be advanced by...
scholarship and is now a member of the Board of Trustees.
Mack's first job in finance was as a clerk at a small brokerage house during his junior year at Duke, after a cracked vertebra made it impossible for him to continue on his football scholarship.
Career
Mack worked at several firms around Wall Street before starting his career at Morgan Stanley in 1972 as a salesman, and has since worked for the company for nearly thirty years. Rising steadily to positions of increasing responsibility, Mack eventually headed the firm's Worldwide Taxable Fixed Income Division from 1985 to 1992. In 1987, he became a member of the board of directors. In March 1992, he assumed responsibility for Morgan Stanley's day-to-day operations as chairman of the operating committee. He was named President of Morgan Stanley in June 1993. Mack served as president, chief operating officer and a director of Morgan Stanley Dean Witter & Co. from May 1997 when the firm was created by the merger of Morgan Stanley and Dean Witter, two of the world's leading financial services companies. He left in 2001 after a power struggle with Phil Purcell; Purcell became CEO of Morgan Stanley after the 1997 merger of Morgan Stanley and Dean WitterDean Witter Reynolds
Dean Witter Reynolds was an American stock brokerage and securities firm catering to retail clients. Prior to its acquisition, it was among the largest retail firms in the securities industry with over 9,000 account executives and was among the largest members of the New York Stock Exchange...
, of which Purcell was already CEO. Mack took on the CEO position at Credit Suisse First Boston
Credit Suisse First Boston
Credit Suisse First Boston was the former name of the banking firm Credit Suisse.-History:In 1978, Credit Suisse and First Boston Corporation formed a London-based 50-50 investment banking joint venture called the Financière Crédit Suisse-First Boston...
(CSFB) six months after that time.
He earned the nickname Mack the Knife for his cost-cutting prowess while managing the fixed income division at Morgan Stanley, and he lived up to his billing at CSFB, where he cut 10,000 jobs and returned the bank to profitability.
Mack returned to Morgan Stanley on June 30, 2005 as chief executive officer and chairman of the board, replacing Purcell. Mack was noted for stabilizing the firm and reenergizing its culture and client franchise.
Insider trading accusations
Mack was accused by former SECUnited States Securities and Exchange Commission
The U.S. Securities and Exchange Commission is a federal agency which holds primary responsibility for enforcing the federal securities laws and regulating the securities industry, the nation's stock and options exchanges, and other electronic securities markets in the United States...
investigator Gary J. Aguirre
Gary J. Aguirre
Gary J. Aguirre is an American lawyer, former investigator with the United States Securities and Exchange Commission and whistleblower. After working in a law firm briefly, he became a public defender, then worked as a trial lawyer in California. Having reached his professional and financial...
of insider trading
Insider trading
Insider trading is the trading of a corporation's stock or other securities by individuals with potential access to non-public information about the company...
. On October 5, 2006, the SEC recommended no action be taken against Mack. http://www.businessweek.com/ap/financialnews/D8KIOU380.htm In late November 2006, Mack and Pequot were notified that the investigation had been closed and no action would be taken against them.
Compensation
While CEO of Morgan Stanley in 2006, John J. Mack earned a total compensation of $41,399,010, which included a base salary of $800,000, stocks granted of $36,179,923, and options granted of $4,019,934.In 2008, he earned a total compensation of $1,235,097, which included a base salary of $800,000 and other compensation of $435,097. He did not receive any cash, stock, or options.
Financial crisis of 2007–2009
Mack guided the firm through the financial crisis of 2008, building its capital position and overseeing the firm's conversion to a bank holding company. To stabilize the firm, he forged strategic alliances with China Investment Corporation and Mitsubishi UFJ Group and entered into a joint venture with Smith Barney, forming at the time the world's largest wealth management firm. During the crisis, Mack was advised by U.S. Treasury Secretary Hank Paulson and the head of the Federal Reserve Bank Ben BernankeBen Bernanke
Ben Shalom Bernanke is an American economist, and the current Chairman of the Federal Reserve, the central bank of the United States. During his tenure as Chairman, Bernanke has overseen the response of the Federal Reserve to late-2000s financial crisis....
to sell Morgan Stanley. He has stated that during negotiations he was under considerable pressure from the president of the New York Federal Reserve, Tim Geithner, to sell or merge Morgan Stanley to one of his competitors such as JP Morgan. Mack saw this as being contrary to the interests of Morgan Stanley shareholders and employees, similar to the demise of Bear Stearns
Bear Stearns
The Bear Stearns Companies, Inc. based in New York City, was a global investment bank and securities trading and brokerage, until its sale to JPMorgan Chase in 2008 during the global financial crisis and recession...
in a forced sale to JP Morgan for $2 per share, (the deal was later revised to $10 a share), and insisted on finding other sources of financing instead.
Other
Mack is a chairman of the board of trustees of New York-Presbyterian Hospital, the University Hospital of both Columbia and Cornell Universities. He is also a director of IMG, a board member of the Bloomberg Family Foundation, and a member of the Business Council and the Business Roundtable. In addition, Mack serves on the International Advisory Council for China Investment CorporationChina Investment Corporation
China Investment Corporation is a sovereign wealth fund responsible for managing part of the People's Republic of China's foreign exchange reserves. CIC was established in 2007 with approximately US$200 billion of assets under management, making it one of the largest sovereign wealth funds...
, the International Business Leaders Advisory Council for the Mayor of Beijing
Beijing
Beijing , also known as Peking , is the capital of the People's Republic of China and one of the most populous cities in the world, with a population of 19,612,368 as of 2010. The city is the country's political, cultural, and educational center, and home to the headquarters for most of China's...
, the International Advisory Panel of The Monetary Authority of Singapore
Monetary Authority of Singapore
The Monetary Authority of Singapore is Singapore's central bank and financial regulatory authority...
, and the executive committee of the Partnership for New York City. In 2005, the C.J. Mack Family Foundation provided an endowment arranged by Mack to the United States Naval Academy Foundation to support the Admiral Frank Bowman
Frank Bowman
Frank "Skip" Bowman a retired four-star Admiral, is the former Chief of Naval Personnel and former Director of Naval Nuclear Propulsion. In 2006, Admiral Bowman was made an Honorary Knight Commander of the Most Excellent Order of the British Empire .-Education:Admiral Bowman graduated from Duke...
Scholar Program.
External links
- John Mack Elected Chairman and CEO of Morgan Stanley (press release)
- "SEC Wants Mack" (Forbes)
- "No SEC action vs. hedge fund, John Mack" (Business Week)
- "Report Says S.E.C. Erred on Pequot (New York Times)"
- The Firing of an SEC Attorney and the Investigation of Pequot Capital Management (Senate Finance and Judiciary Committees, Joint Staff Report)
- http://www.businessweek.com/investor/content/jun2006/pi20060621_288903.htm