Morgan Stanley's chairman John Mack will step down as chairman and leave the bank's board of directors at the end of 2011.
The widely expected move brings an end to a storied Wall Street career. Mack, a North Carolina native, was CEO of Morgan Stanley from 2005 to 2009. Chief Executive James Gorman will take over the chairman's role.
Mack's career at Morgan Stanley was marked with boardroom intrigue. He was involved in a bitter power struggle with then CEO Philip Purcell in 2001 and was forced to leave after 29 years at Morgan Stanley. Mack joined Credit Suisse First Boston, where he was CEO from 2001 to 2004.
When Mack returned to Morgan Stanley in 2005 as CEO he was greeted with cheers at an employee meeting and a standing ovation from the trading floor.
Mack is largely credited with saving the investment bank during the financial crisis by negotiating a $9 billion investment from the Japanese bank Mitsubishi UFJ Financial Group. However, Mack was criticized for the firm's poor performance during and after the crisis before handing over the CEO spot to Gorman in 2010.
Morgan Stanley stock jumped 7 percent to $16.56 as of 3 p.m.