Vikram Pandit quits Morgan Stanley

Vikram S. Pandit, president of institutional securities business at Morgan Stanley, and John P. Havens who ran the institutional equity business, resigned yesterday after two other executives were appointed co-presidents above them.

According to a report on the website of New York Times, the two executives come from the blue-chip institutional business, which is responsible for trading and investment banking and generates 60% of Morgan's profits.

Philip J. Purcell, chief executive of Morgan Stanley, who secured his position at the top of Morgan Stanley by ousting a rival in a bitter power struggle, now faces a revolt of his own, the report added.

"While Wall Street is no stranger to palace intrigue, the infighting at one of the biggest investment houses in the world is remarkable for an industry that puts a premium on discretion and loyalty. Eight former Morgan Stanley executives have now spoken out to urge the board that Mr. Purcell be replaced immediately as chief executive," the report said.

The turmoil reflects the long-standing divisions that have riven the firm since the 1997 merger of the investment banking half of Morgan and financial retailer Dean Witter.

The conflict comes at a time when Morgan Stanley's areas of expertise in the market - equity underwriting and mergers and acquisitions - are experiencing lulls, relative to the boom years in the late 1990's, the report added.