In its first quarter results released today, investment bank Morgan Stanley reported income of $1.8 billion, compared with a loss of $17 million in the first quarter the previous year. Net revenues were $9.1 billion, compared with $2.9 billion a year earlier. The increase in revenues were aided by the Morgan Stanley Smith Barney joint venture that closed in mid-2009.
Morgan Stanley said its brokerage and Global Wealth Management divisions delivered revenues of $3.1 billion, remaining flat from the fourth quarter but up from $1.3 billion a year earlier, thanks to the joint venture. Net new assets for the quarter were $5.8 billion, keeping clients assets flat at $1.6 trillion.
Morgan Stanley Smith Barney’s fee-based assets now make up 26% of its client assets, up from 24% in the fourth quarter.
Morgan Stanley Smith Barney boasts 18,140 representatives (a gain of five advisers from the fourth quarter of 2009), making it the largest wirehouse firm. However, its adviser production falls below Bank of America Merrill Lynch. At Morgan Stanley Smith Barney, average annualized revenue per adviser is $685,000 and total client assets per adviser of $88 million. Revenue per adviser at BofA Merrill is $807,000 (see “Merrill Profits Fall as Assets Shift to BofA Retail Division”).
James P. Gorman, president and CEO of Morgan Stanley said in a statement: “We are driving forward key strategic initiatives, including the integration of the Morgan Stanley Smith Barney joint venture, where we saw the highest levels of net new assets since the fall of 2008 and historic lows in financial adviser turnover.”