Mack Should Leave Morgan Stanley for Good: Bove

The change in the Morgan Stanley management will benefit the bank, but CEO John Mack should leave for good, Rochdale Securities Banking analyst Richard Bove told CNBC Friday.

Mack, 64 years old, will be replaced as CEO by James Gorman, one of the investment bank's co-presidents, but will remain chairman of Morgan Stanley.

The bank's management drew criticism from some quarters lately after a string of recent losses. These management changes will take effect January 1, 2010.

"Once the CEO leaves … he should leave the company," Bove told "Squawk Box."

The bank has two strong people at his helm, Gorman and chief financial officer Colm Kelleher, he said.

"Good things should happen. But this company, for 10 years, has been a mess," Bove added.

John Mack testifying before House Financial Services Committee
John Mack testifying before House Financial Services Committee

Investors have made no money in Morgan Stanley's stock for a decade because the bank has never had a coherent strategy, and this will probably change now, according to Bove.

"You cannot change your strategy every couple of years based on any new fad in the market," he said, adding that managing risk is another thing Morgan Stanley has to get right.

"That's why Goldman is effective and that's why everybody else is ineffective."