Morgan Stanley hit by the slump in corporate and investment banking

Morgan Stanley has announced a 9% drop in profits in the first quarter of the year, with the last major US banks to have announced these profits being haunted by the same decline in trading revenue that has plagued rivals and a sharp decline investment banking fees.

The bank's net profit for the first quarter was $ 2.47 billion compared to $ 2.7 billion in the first quarter of 2018, while earnings per share of $ 1.39 were lower than the first quarter. $ 1.45 in the first quarter of 2018, but higher than the $ 1.17 expected by badysts. .

Group revenues decreased 7% to $ 10.3 billion, including a nearly 15% decline in Institutional Securities' revenue, Morgan Stanley's investment banking and trading business. .

However, Morgan Stanley's shares grew by more than 2% in pre-market transactions as investors took advantage of better-than-expected wealth management margins and investment gains.

"We have achieved solid results despite the slow start to the year following the market turmoil in the fourth quarter," said General Manager James Gorman. "While the risks to the global environment remain, markets have recovered and we are well positioned to serve our customers and invest in our business."

Morgan Stanley's investment banking revenues fell 24%, which is lower than the 6.5% average increase recorded by its four major rivals in the same quarter. The largest decrease was in Morgan Stanley's consulting services revenue, down nearly 30%, which the bank says reflects "the impact of lower merger and acquisition costs." acquisition".

Trading revenue decreased by approximately 15%, while Wealth Management division, which accounts for approximately 45% of Morgan Stanley's business, was approximately equal. The bank said the drop in spending reflected its "controlled concentration and discipline" on costs.

The results put the curtain on a mixed season for US bank profits.

The results of JPMorgan Chase sparked the strongest reaction from shareholders. The bank's shares climbed 4.5%, with investors rewarding the highest quarterly profit ever for a US bank and bolstering leaders' forecasts of continued revenue growth, even though the Fed is keeping rates down. Interest at a lower level.

Goldman Sachs' results fell nearly 4% on the announcement of its results, in part because the bank missed the interest-based retail banking boom that helped groups like Citi and JPMorgan, and after the bank has postponed its long-awaited strategic update next year.