On Wednesday, Morgan Stanley
Morgan Stanley Beats Estimates On Strong Trading, Dealmaking
The U.S. bank reported revenue of $20.58 billion, up 16% year over year, beating the consensus of $19.724 billion.
Provision for credit losses in the quarter was driven by individual assessments for certain commercial real estate loans in addition to increased macroeconomic uncertainty.
The firm's expense efficiency ratio was 65% compared to 68% a year ago.
Morgan Stanley's first-quarter return on tangible common equity was 27.1%, compared to 23.0% a year ago.
Revenue Growth Driven By Market Activity
Institutional Securities reported record net revenues of $10.7 billion, reflecting strong performance in Markets businesses driven by robust client engagement on increased market volatility, and strength in Investment Banking led by advisory.
Wealth Management Shows Strong Asset Growth
Wealth Management delivered revenues of $8.5 billion with a pre-tax margin of 30.4%, reflecting strong asset management revenues, robust levels of client activity and higher net interest income.
The business demonstrated strong momentum with net new assets of $118 billion and fee-based asset flows of $54 billion for the quarter.
Investment Management results reflect net revenues of $1.5 billion, primarily driven by asset management fees on higher average AUM. The quarter included positive long-term net flows of $3.3 billion.
Equity net revenues increased 25% to $5.15 billion from a year ago, with outperformance across businesses and regions, particularly in prime brokerage and derivatives, driven by strong client activity.
Fixed Income net revenues increased 29% to $3.36 billion from a year ago, reflecting strong results across businesses on strong client activity with increases in commodities benefiting from volatility in the energy markets.
Morgan Stanley's investment banking revenue jumped 36% to $2.12 billion, on higher fees from completed M&A transactions as well as underwriting.
Morgan Stanley CFO Highlights Role Of Volatility
In an interview with Bloomberg, Morgan Stanley CFO Sharon Yeshaya said, "We get a lot of questions often around good vol and bad vol, referring to volatility. "What it did for us is it really provided an opportunity for us to showcase advice."
MS Price Action: Morgan Stanley shares were up 5.27% at $193.00 at the time of publication on Wednesday. The stock is trading at a new 52-week high, according to Benzinga Pro data.
