Morgan Stanley’s funding bankers scored their finest quarter ever, boosted by a torrid tempo of dealmaking.
The division hauled in $2.85 billion within the third quarter, a 67% soar that topped analysts’ estimates and helped drive firmwide profitability greater. Fairness-trading income surged 24% to $2.9 billion.
“We had standout efficiency of our built-in funding financial institution and report internet new property of $135 billion in wealth administration,” Chief Government Officer James Gorman mentioned in an announcement Thursday.
Wall Avenue’s prime corporations have been capitalizing on a golden period for dealmaking and buying and selling because the begin of the pandemic. Now, as a buying and selling slowdown takes maintain, funding bankers have been choosing up the slack, with booming capital markets and merger-advisory companies producing report charges.
Financial institution of America Corp. mentioned earlier Thursday that its third-quarter outcomes received a lift from greater charges on the dealmaking unit. JPMorgan Chase & Co. mentioned Tuesday its mergers-and-acquisitions enterprise posted its finest quarter ever.
Shares of Morgan Stanley, which have superior 44% this 12 months, climbed 1.6% to $100.10 at 7:55 a.m. in early New York buying and selling. The New York-based agency’s positive aspects all through the pandemic have been outpacing rivals with shopper operations, which suffered in the course of the disaster.
Morgan Stanley’s investment-banking income surpassed the common estimate of $2.1 billion. Advisory charges greater than tripled to $1.27 billion and fairness underwriting climbed 16% to $1 billion.
The financial institution’s advisory enterprise had a much less stellar first half of 2021, when it gave up floor to a number of the agency’s closest rivals and received off to its weakest begin in no less than a decade.
Morgan Stanley boosted pay for its junior bankers for a second time in August, an indication of its resolve to battle for expertise amid extra intense competitors.
Buying and selling income surpassed final 12 months’s figures, with the division pulling in $4.52 billion, greater than final 12 months’s third quarter determine of $4.27 billion.
Wealth-management income totaled $5.94 billion, an more and more rising share of the financial institution’s general income pool that’s much less risky than its institutional-securities enterprise, which homes merchants and dealmakers.
The financial institution’s solely main hiccup was in its investment-management enterprise, the place it had asset outflows tied to an asset supervisor’s redemption. It additionally had a $17 million loss on performance-based earnings tied to an funding in Asia, in line with the assertion.
This story has been revealed from a wire company feed with out modifications to the textual content.
Supply: Live Mint