Veteran analyst Paul Mazzilli, two weeks short of his 60th birthday, is apparently leaving his post overseeing Morgan Stanley's analyst team covering exchange-traded funds, according to people familiar with the matter.

Mazzilli is one of the best-known names in ETF research, and his team's reports are widely read by industry participants. Remaining members on the acclaimed team he built include Dominic Maister, David Perlman and Mitchell Schorr.

Although Mazzilli wasn't available on Wednesday to discuss his employment situation in public, he has relayed to others that plans are being made to announce he'll be leaving Morgan Stanley.

Mazzilli also is said to have relinquished his full-time daily responsibilities with the firm, IndexUniverse has confirmed, although he remains on Morgan Stanley's payroll for the time being and is available to do part-time work for its research staff.

Mazzilli also is believed to have retained many of his retirement benefits with the company. Whether he agreed to take an early retirement from the struggling financial services firm wasn't clear to those familiar with the situation. 

"But it's safe to say that Morgan Stanley is struggling for its life and is making cutbacks in many different areas," said one source.

Maister declined to comment on the situation late Wednesday.

According to at least one source, Mazzilli is considering joining the boards of several fund companies and contemplating outside consulting offers. 

Mazzilli joined Morgan Stanley in 1975 and has worked in planning and analysis, capital markets, pensions and equity derivatives. As an executive director at the firm and its director of ETF research, Mazzilli oversaw analysis of actively managed closed-end funds as well as passively managed index-linked exchange-traded products.

He also guided the management of Morgan Stanley's Strategic Equity Portfolios (STEP) products and asset allocation models using ETFs.

Mazzilli was trained as an engineer in college. He also holds an M.B.A. from Columbia University.

Whether downsized or offered early retirement, the loss of Mazzilli comes on the heels of the loss of Deborah Fuhr in May. She headed Morgan Stanley's influential investments strategy group, which helped advise and supplied research to some of the world's biggest institutional money managers. 

As head of the London-based team, Fuhr was one of the first researchers to dig into global ETF markets. Along with Mazzilli's more retail-minded approach in the States, for years Morgan Stanley provided cutting-edge analysis and data on exchange-traded products across institutional and retail channels in nearly every major market around the world.

Although probably too soon to tell yet, early speculation in the industry centers on whether Barclays Global Investors might be interested in Mazzilli's services. The San Francisco-based firm is the dominant player in ETFs and has aggressively moved to enhance its institutional research operations both domestically and internationally.

That's where Fuhr ended up, agreeing in September to become its global head of ETF research and implementation strategy. (See related story here.)