UPDATE 1-Morgan Stanley names 212 managing directors

* Firm's promotions top '08 class of 133

* Appointments still below '07, '06 and '05 levels

NEW YORK Dec 23 (Reuters) - Morgan Stanley (MS.N) promoted 212 employees to managing director status on Wednesday, a 60 percent increase from 2008.

The increase signals the bank is recovering from the 2008 banking crisis that crippled the industry, downed some of Morgan Stanley's competitors and forced the bank to scale back promotions.

Morgan Stanley reported a third quarter profit in October, the bank's first quarterly earnings since the third quarter of 2008.

The 212 promotions for 2009 top the 133 in 2008, but still fall below the 241 in 2007, 228 in 2006 and 220 in 2005.

Morgan Stanley is in the midst of changing its leadership.

James Gorman will take over from John Mack as chief executive on Jan 1. Morgan Stanley announced a reshuffling of top managers earlier this month, naming Ruth Porat as chief financial officer.

Last week, Greg Fleming, a former Merrill Lynch president and chief operating officer, was hired to run Morgan Stanley's investment management group. He will also be responsible for global research. (Reporting by Steve Eder; editing by Andre Grenon)