Friday, November 30, 2007

zoe cruz

NEW YORK (Reuters) - Morgan Stanley (MS.N: Quote, Profile , Research) Co-President Zoe Cruz is retiring, the investment bank said on Thursday, as the subprime mortgage crisis ends a 25-year tenure for a woman who had been seen as the front-runner to succeed Chief Executive John Mack.

The resignation was part of a broad management shake-up at the second-largest U.S. investment bank. Walid Chammah and James Gorman were named co-presidents. Robert Scully, co-president with Cruz, is joining a new Office of the Chairman. Morgan Stanley's co-trading head, Neal Shear, is now chairman of the company's commodities business.

Cruz resigned three weeks after Morgan Stanley said it suffered $3.7 billion of subprime mortgage-related losses in September and October.

"Zoe clearly is accepting responsibility for the trading disappointment in the fourth quarter," said Brad Hintz, analyst at Sanford C. Bernstein & Co. Morgan Stanley's shares are down 23 percent this year, a worse performance than its peers.

Cruz, 52, joined Morgan Stanley in 1982 as a foreign exchange trader and rose to become head of fixed income trading by 2000.

A source said on Nov. 9 that Mack had tapped Cruz as the leading candidate to succeed him, despite the write-downs that had been disclosed two days before.

Mack, 63, has a five-year contract that extends to 2010. He is not expected to leave Morgan Stanley any time soon, but his close links to Hillary Clinton, front-runner for the Democratic presidential nomination, have fueled speculation that he could become the next U.S. Treasury Secretary
Zoe Cruz
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Zoe Cruz (born February 2, 1955) was appointed Co-President of Morgan Stanley on February 9, 2006. The announcement was made by John J. Mack, the chairman and chief executive of Morgan Stanley.

Cruz has a 24-year history with Morgan Stanley. She graduated from Harvard University with a bachelor's degree in Literature in 1977. She received an MBA from Harvard Business School in 1982. She began her career at Morgan Stanley in 1982, becoming a Vice President in 1986, a Principal in 1988 and a Managing Director in 1990. From 2000 to 2005, she held the position of global Head of Fixed Income, Commodities and Foreign Exchange.

Cruz was a long time supporter of former CEO, Phil Purcell. She became an integral part of the leadership controversy at Morgan Stanley on March 29, 2005 when Purcell replaced then President Stephan Newhouse. Zoe Cruz and Stephen S. Crawford were named Co-Presidents. This controversial move led to a full-page advertisement in the Wall Street Journal on March 31, 2005. The advertisement featured opposition to the company leadership by a group of dissidents known as the "Group of Eight". Several distinguished executives later left the firm amid speculation that they disagreed with the new management structure.

Phil Purcell announced his retirement on June 13, 2005 and John J. Mack was named successor. On July 11, 2005, Stephen S. Crawford resigned his position of Co-President "to pursue other interests". Cruz was subsequently appointed acting president. Her lengthy position as acting president led to much speculation about the future direction of the company. This appointment may silence rumors that the position was left open as a potential merger negotiation item.

Cruz is married to Ernesto Cruz, head of equity capital markets at the investment banking unit of Credit Suisse Group (CSR). Morgan Stanley and Credit Suisse First Boston (CSFB) were principal underwriters of the 2004 Google IPO.

On November 29, 2007 Morgan Stanley announced that Zoe Cruz was resignig as co-president of the firm and that she would retire immediately.[1]


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