Finn has his hands full. If bare wrists help him move ever so slightly faster, it’s worth it. The bank is about $3 trillion away from its target of $10 trillion in client assets combined with wealth and asset management. Reaching this goal requires multiple tacks: to name a few, pooling the resources of the two divisions to create a one-stop shop for clients, developing AI tools to help advisors work faster, and getting E*Trade and stock plan customers to become financial advisory clients, too. To top it all off, the wealth unit is facing probes from multiple regulators into how it vets clients, as reported by The Wall Street Journal.

The investigations are “not a new matter,” Finn said. “We work closely with our regulators to make sure that our client onboarding processes are consistent with the standards of the industry.”

He described the $10 trillion target as the bank’s “North Star” and said his second target, a 30% pretax profit margin, will come in time.

“Everything else comes out of that goal,” he said, “meaning anything we talk about as it relates to margins will necessarily happen as a result of our organic growth.”

How to get 1 plus 1 to equal 3

With wealth and investment management both under Saperstein, Finn spends much of his time working with the new co-heads of the asset management arm, Jacques Chappuis and Ben Huneke. Saperstein is undergoing cancer treatment but is still working and has “a lot of energy,” Finn said. By partnering, the divisions are worth more than the sum of their parts, or as he describes it, “one plus one equals three.”

The units are combining their outsourced investment services for ultra-high-net-worth wealth clients and institutional customers. They are now working to make it easier for wealth clients to get tax-efficient portfolios through Parametric, a direct indexing provider acquired by the asset management arm in 2021.

Every bank wants to be a one-stop shop for wealth management. While Finn is careful not to be complacent, previously describing himself as “paranoid,” he is bullish about the bank’s ability to serve clients from Main Street to the ultrawealthy.

“We can actually do it,” he said of the competition.

From the workplace side, the bank can manage clients from humble beginnings as startup founders working in a garage to leaders of multibillion publicly traded companies, he said. They can use Morgan Stanley’s stock plan manager, Shareworks, as they raise capital and sell shares. The $7 billion (revenue) investment bank is ready for them once they go public. The wealth management arm is there to help them pay less taxes on their windfall and manage their fortune. Morgan Stanley can manage employees’ equity plans and 401ks.

Customers with at least $250,000 in investible assets can pair with a financial advisor. Clients with at least $5 million work with private wealth advisors, and those with $100 million or more qualify for family office services.

While Finn isn’t looking to introduce more products through acquisitions, the wealth unit has rolled out some new offerings, such as private-company stock trading on the secondary market last month. That said, Morgan Stanley has drawn the line in the past at some offerings like health savings accounts.

“We’re not trying to be a broader human resources outsourcing department,” he said.

Getting more customers to pair up with financial advisors

Hitting that $10 trillion asset target hinges on getting existing customers to park more of their money with Morgan Stanley. The wealth unit has some 18.5 million customers that hold about $10 trillion in assets at other banks, according to Finn. Further, many of these customers do not work with Morgan Stanley financial advisors and are only clients through the bank’s discount brokerage E-Trade or a participating stock plan.

For Finn, those offerings are a means to an end: converting as many of these clients as possible to become fee-paying wealth management clients. The revenue and margins of the workplace channel and E-Trade, which Morgan Stanley acquired for $13 billion in 2020, are “irrelevant,” he said.

“The reason why we’re in those businesses is to build relationships with clients early and then make introductions to financial advisors,” he added.

He is making more products accessible to lure non-advisory clients in the future. Morgan Stanley has introduced fractional shares and low-to-no-cost prebuilt portfolios of mutual funds and ETFs.

Using AI to make advisors faster — and actually getting employees to use it

Finn is betting on AI to help advisors spend more time with clients and less time on administrative tasks. In September, Morgan Stanley rolled out a chatbot developed with OpenAI, the marker of ChatGPT, to its financial advisor workforce.

Morgan Stanley plans to expand AI projects firmwide, promoting Jeff McMillan, the head of wealth-management analytics, data, and innovation, in March to lead the effort. As for the wealth unit, two more AI product releases are in the works. AIMS Debrief, already in pilot mode, summarizes Zoom conversations with clients and generates emails with the next steps for the client and the advisor. AIMS Plus, not yet in pilot mode, helps advisors send emails, conduct research, create newsletters, and more.

Developing tools like the chatbot AIMS Assistant is just half the battle. The other half is getting thousands of financial advisors to use them.

The bank said 98.5% of the small teams that make up the advisor workforce have at least one member who uses the product once a week or more. While uptake has been quick on the team level, there are stragglers. Morgan Stanley declined to specify how many advisors do not use AIMS but acknowledged that older ones are slower to adopt new technology. (Financial advisors are 55 years old on average per JD Power).

Finn acknowledged that training is required to get more advisors to use it. Part of this is reminding advisors to use it through instructional videos and sending tech trainers to meet with advisors in the field. But the most effective strategy is getting advisors to teach each other.

He said that over time, more efficient advisors will lead to better margins. While the bank will have to proceed carefully to comply, these AI tools will eventually reduce the number of administrative staff needed.

The ultimate goal is a voice-activated bot that can execute complex tasks like drafting proposals, rebalancing portfolios, transferring money, and creating performance reports. This is several years away, Finn said, but the bank is putting the architecture in place.

“We think the firm that gets that right first is going to create significantly more efficient advisors, and we are committed to delivering that,” he said.