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Morgan Stanley Chief Executive Officer Ted Pick said after Morgan Stanley's first-quarter profit rose 14%, the company is looking to boost Wall Street's long-awaited investment banking recovery. He insisted that closing the deal was „real.“
The bank reported net income of $3.4 billion for the first three months of the year, up from $3 billion a year earlier and comfortably beating analysts' estimates of $2.7 billion compiled by Bloomberg.
Investment banking fees were a bright spot, rising more than expected by 16% as the initial public offering market began to reopen after two years of weakness.
morgan stanleyAlthough the recovery in investment banking at Goldman Sachs hasn't been as dramatic as that of many of its competitors (Goldman Sachs' fees rose 32%), Mr. Pick offered a bullish outlook.
„We like that this is early to mid-cycle for traditional investment banking and capital markets businesses around the world,“ Pick said. It took over That's what longtime chief James Gorman said in January.
![Fee line chart showing first quarter investment banking fee increases at large U.S. banks (in billions)](https://www.ft.com/__origami/service/image/v2/images/raw/https%3A%2F%2Fd6c748xw2pzm8.cloudfront.net%2Fprod%2Fa7ef9410-fbe6-11ee-b9b9-434e70f762bf-standard.png?source=next-article&fit=scale-down&quality=highest&width=700&dpr=1)
![Fee line chart showing first quarter investment banking fee increases at large U.S. banks (in billions)](https://www.ft.com/__origami/service/image/v2/images/raw/https%3A%2F%2Fd6c748xw2pzm8.cloudfront.net%2Fprod%2Fa7ef9410-fbe6-11ee-b9b9-434e70f762bf-standard.png?source=next-article&fit=scale-down&quality=highest&width=700&dpr=1)
Pick said there is pressure on private equity firms to sell existing assets and inject new capital, and that large companies are overhauling their supply chains as a driver for investment banking expansion. It was pointed out that there was a need to reconsider.
“The need to conduct cross-border M&A is here. For many companies, it is an existential reality. Their supply chains have been disrupted by two major global conflicts,” Pick said. Ta.
Revenue from equity trading, which analysts had expected to decline, rose 4% to $2.8 billion, but revenue from fixed income trading fell 4%.
![Line chart of trading revenue (in billions) showing strong first quarter performance for bond and equity traders at U.S. banks.](https://www.ft.com/__origami/service/image/v2/images/raw/https%3A%2F%2Fd6c748xw2pzm8.cloudfront.net%2Fprod%2Fb642bc50-fbea-11ee-902b-271131fb688c-standard.png?source=next-article&fit=scale-down&quality=highest&width=700&dpr=1)
![Line chart of trading revenue (in billions) showing strong first quarter performance for bond and equity traders at U.S. banks.](https://www.ft.com/__origami/service/image/v2/images/raw/https%3A%2F%2Fd6c748xw2pzm8.cloudfront.net%2Fprod%2Fb642bc50-fbea-11ee-902b-271131fb688c-standard.png?source=next-article&fit=scale-down&quality=highest&width=700&dpr=1)
The quarter was Pick's first. His background in investment banking and trading contrasts with his predecessor, James Gorman's years of experience in wealth management. This result highlights Morgan Stanley's capabilities. wealth management The business of adding new customer assets on a large scale has been the driving force behind banks' growth in recent years.
The division raised billions of dollars in the quarter, more than investors expected. Net new assets were approximately $95 billion, significantly higher than the $62 billion expected. Morgan Stanley has set a long-term goal of amassing more than $10 trillion in client assets.
Morgan Stanley stock ended Tuesday up 2.5%.
Mr. Pick downplayed recent reports that Morgan Stanley had committed fraud. being searched Multiple U.S. regulators have criticized the company's wealth management division for how it handles potentially risky clients, saying the wealth management division's results this quarter „speak for themselves.“ ” he said.
“We have long focused on client onboarding and process oversight,” Pick said. “Like all major banks, we are in ongoing communication with regulators.”