Morgan Stanley has announced that John J. Mack will step down as chairman of the firm and leave the board of directors at the end of this year, and James Gorman will take over that position.

The move was expected and Mack also will retire from a full-time role at Morgan Stanley to become a senior advisor to the firm.

Gorman is currently president and chief executive officer, but Morgan Stanley’s board of directors elected him to the additional role of chairman effective January 1, 2012.

Gorman, who ran wealth management at the firm, succeeded Mack as chief executive officer back on Jan. 1, 2010.

Gorman "is everything shareholders like," said Alois Pirker, research director of Boston-based consulting firm, Aite Group.

And Gorman's wealth management background holds special appeal for the financial advisors who populate the merged Morgan Stanley Smith Barney joint venture.

Gorman joined Morgan Stanley in 2006 as President and Chief Operating Officer of the wealth management group. From 2007 to 2009, he served as co-president, with responsibility for the firm's Global Wealth Management Group, Morgan Stanley Investment Management and operations and technology functions, according to the firm's website. "I think it is very good for the brokerage side of the house," Pirker said. "Brokerage is going to be a top item for the firm."

But will Morgan Stanley's wealth unit pull away from its rivals, especially Bank of America Merrill Lynch? "The way I see Morgan Stanley," Pirker said, "it is really the old Merrill."

Pirker said it is too early to tell who will end up on top but with the changes at Merrill Lynch, including the resignation of global wealth chief Sallie Krawcheck last week and the announcement of layoffs, Morgan Stanley could become the dominant player in the industry. "Morgan Stanley has a great shot," Pirker said, "but don't underestimate Merrill."

In its most recent earnings report in July, Morgan Stanley reported better-than-expected sales and a smaller-than-expected loss in its second quarter, posting a loss of 38 cents a share on sales of $9.3 billion. The revenue number marked a 17% improvement from the year-ago quarter.