Lazard announced on Friday that Peter Orszag, who leads its core financial advisory business, will succeed Ken Jacobs as the company’s chief executive on Oct. 1. Jacobs will remain chief executive and continue to advise clients.
Orszag, a former Obama administration official, will oversee a 175-year-old financial institution with a long history of advising big corporate deals at a time when its core businesses face enormous challenges.
“Throughout his career spanning banking and government, Peter has proven himself to be a strategic, visionary and decisive leader, with deep industry-wide relationships and the ability to effectively lead Lazard through evolving global markets and complex geopolitical dynamics,” Richard Parsons, the company’s chief independent director, said in a statement.
Lazard did not say when its succession planning began, but Orszag, 54, wrote in a memo to employees on Friday that the move followed a “selection process that has been ongoing for some time.”
An economist by training, Orszag appears regularly on CNBC and Bloomberg Television. He’s risen through the ranks in Washington and on Wall Street — he’s worked for Presidents Bill Clinton and Barack Obama, as well as Citigroup — giving him a useful background for running one of the world’s most prominent independent banks.
But he will face a tough time for investment banks.. Trading is down 40 percent this year through Thursday compared with the same period last year, according to Refinitiv. And rising interest rates, tightening antitrust enforcement and a slowing economy make a resurgence of big mergers and acquisitions unlikely any time soon.
The challenging environment has hit Lazard, which said last month it was laying off 10% of its workforce; the bank’s stock has dropped 11% since then. The company is not alone: Rivals such as Goldman Sachs and Morgan Stanley have also cut staff.
In the memo to colleagues this morning, Mr. Orszag said the company’s ambition “should be to become the preeminent independent, global destination in all aspects of complex corporate finance, investment and strategic decision-making.”
One of Orszag’s top priorities is expanding Lazard’s asset management business, which manages more than $200 billion in assets and represents 40% of its business. Asset management has become popular with Wall Street banks as a steady source of revenue that can offset volatility in investment banking; Mr. Orszag told employees that growth could come from acquisitions.
Mr. Orszag also said Lazard’s investment banking business will pursue growth opportunities in private capital markets and through work in the Middle East.
Among its other priorities are “attracting and retaining top talent through a modern workplace, including our technology platform, diversity and work-from-home flexibility,” said Orszag.
The company will announce other changes to its management before October.
