Rosenthal, 57, has been responsible for merging Morgan Stanley and Citigroup's
As COO, he succeeds Thomas Nides, who held the post for less than a year. Nides left Morgan Stanley late last year to join the U.S. State Department as deputy secretary for management and resources.
In his new role, Rosenthal will continue to oversee the integration of Morgan Stanley Smith Barney, in which the company holds a 51 percent stake.
According to the memo, Rosenthal will also oversee human resources, corporate communications, marketing, community affairs and corporate services.
Rosenthal joined Morgan Stanley in 2008 from commercial real estate firm Tishman Speyer, where he had been chief financial officer since 2006.
He currently is on the bank's management committee.
(Reporting by Joe Rauch; Editing by Lisa Von Ahn and John Wallace)