Morgan Stanley Reports Fourth Quarter and Full Yea
Morgan Stanley Reports Fourth Quarter and Full Year 2012:
Fourth Quarter Net Revenues of $7.0 Billion Included the Negative Impact of $511 Million from the Tightening of Morgan Stanley's Debt-Related Credit Spreads (DVA);1 Income from Continuing Operations of $0.28 per Diluted Share
Excluding DVA, Fourth Quarter Net Revenues were $7.5 Billion and Income from Continuing Operations was $0.45 per Diluted Share2, 3
Fourth Quarter Global Wealth Management Pre-Tax Margin of 17%, Highest Since the Inception of the Joint Venture; Investment Banking Ranked #1 in Global IPOs and #2 in Global Announced M&A and Global Equity;4 Solid Results in Equity Sales and Trading
Full Year Net Revenues of $26.1 Billion Included the Negative Impact of $4.4 Billion from DVA; Loss from Continuing Operations of $0.03 per Diluted Share; Excluding DVA, Net Revenues were $30.5 Billion and Income from Continuing Operations was $1.59 per Diluted Share2, 3
For a printable copy, click here.
Introduction
Institutional Securities
Global Wealth Management Group
Asset Management
Full Year Results
Full Year Segments Results
Capital
Other Matters
Safe Harbor
Financial Supplement
INTRODUCTION
NEW YORK, January 18, 2013 – Morgan Stanley (NYSE: MS) today reported net revenues of $7.0 billion for the fourth quarter ended December 31, 2012 compared with $5.7 billion a year ago. For the current quarter, income from continuing operations applicable to Morgan Stanley was $573 million, or $0.28 per diluted share,5 which included a net tax benefit of approximately $155 million,6 or $0.08 per diluted share, compared with a loss of $222 million, or a loss of $0.13 per diluted share,5 for the same period a year ago. The prior year fourth quarter included a pre-tax loss of approximately $1.7 billion, or a loss of $0.58 per diluted share, related to the comprehensive settlement with MBIA Insurance Corporation (MBIA).
Results for the current quarter included negative revenue of $511 million compared with positive revenue of $216 million a year ago related to changes in Morgan Stanley's debt-related credit spreads and other credit factors (Debt Valuation Adjustment, DVA).1
Excluding DVA, net revenues for the current quarter were $7.5 billion compared with $5.5 billion a year ago and income from continuing operations applicable to Morgan Stanley was $894 million, or $0.45 per diluted share, compared with a loss of $349 million, or $0.20 loss per diluted share a year ago.3, 5, 7
Compensation expense of $3.6 billion in the current quarter declined from $3.8 billion a year ago. Non-compensation expenses of $2.5 billion increased from $2.3 billion a year ago.
For the current quarter, net income applicable to Morgan Stanley, including discontinued operations, was $0.25 per diluted share, compared with a net loss of $0.15 per diluted share in the fourth quarter of 2011. Discontinued operations in the current quarter includes a provision of approximately $115 million related to a settlement with the Federal Reserve Board concerning the independent foreclosure review related to Saxon.8