Morgan Stanley's Michael Grimes, the $10.5m salary and the $56m stock bonus

Michael Grimes is back at Morgan Stanley. The Financial Times reported today that Grimes has returned from his long year in the Trump Administration. 

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Instead of simply being a managing director (MD) and co-head of technology investment banking at Morgan Stanley as he was before, Grimes will now be the bank's group chair of investment banking. In this new role, Morgan Stanley says Grimes will apply his expertise to  "the full banking and [institutional securities group] franchise, particularly as technology transforms productivity and impacts global industrial policy." 

Now that Grimes is back in the room, it's worth remembering that he was never a standard investment banker anyway. In the public financial disclosure report that Grimes filed when he joined the government in 2025, he revealed a $10.5m Morgan Stanley salary and $56m of Morgan Stanley bonuses that had been deferred during the previous three years. By comparison, H1B Visa filings suggest the average salary for an MD at Morgan Stanley is closer to $400k. 

As we reported last April, Grimes received other special dispensations during his 30 year career with the bank. He was, for example, permitted to avoid Morgan Stanley's management committees and firmwide strategy sessions, and encouraged to simply originate deals. He did this successfully, working on the IPOs of Facebook and Airbnb and cultivating a strong relationship with Elon Musk.

Musk is coincidentally considering a $1.5 trillion IPO for SpaceX this summer, and the FT notes that Grimes' return leaves Morgan Stanley well-placed to win a leading role. If so, Grimes' next bonus at Morgan Stanley could be far higher than his last one.

Grimes doesn't really need the money. As is always the case when bankers leave for government roles, Grimes benefited from the accelerated vesting of his $56m of Morgan Stanley stock, which became accessible all at once instead of in three year tranches when he left for Trump. He will also have avoided capital gains tax if his deferred stock were reinvested in US treasuries or diversified funds. 

Grimes wasn't really suited to government jobs. When he worked on a purge of the Chips Program Office last year, government employees complained of his manner and said it wasn't a "psychologically healthy place to work." Back at Morgan Stanley, Grimes can now be as brusque as he likes, so long as he delivers the SpaceX IPO.

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