01—Abstract
Summary
Summary of the 10-Q filed November 4, 2024. Cited figures are marked; the original filing is the authoritative source.
Morgan Stanley reported a strong third quarter of 2024, with net revenues increasing by 16% year-over-year to $15.4 billiona and net income applicable to Morgan Stanley common shareholders rising by 32% to $3.2 billion.
Diluted earnings per common share saw a 36% increase to $1.88b. These results reflect robust performance across all key business segments: Institutional Securities, Wealth Management, and Investment Management. The Institutional Securities segment benefited from higher client activity in Equity and Fixed Income, along with increased underwriting revenues in Investment Banking.
Wealth Management demonstrated strong net revenue growth, driven by higher asset management and transactional revenues, and continued to grow client assets to $6 trillionc. Investment Management also saw increased net revenues, primarily due to higher average Assets Under Management (AUM). The firm maintained a solid capital position, with a Standardized Common Equity Tier 1 capital ratio of 15.1%.
The reported Return on Equity (ROE) was 13.1%d and Return on Tangible Common Equity (ROTCE) was 17.5% for the quarter. Expenses were managed effectively, with an expense efficiency ratio of 72%. The provision for credit losses decreased significantly compared to the prior year quarter, indicating improved credit conditions.
02—Key points
Key Highlights
- Net revenues increased 16% year-over-year to $15.4 billion.
- Net income applicable to Morgan Stanley common shareholders increased 32% year-over-year to $3.2 billion.
- Diluted earnings per common share rose 36% year-over-year to $1.88.
- Institutional Securities net revenues grew 20% year-over-year, driven by strong Equity and Fixed Income performance.
- Wealth Management net revenues increased 14% year-over-year, with total client assets reaching $6 trillion.
- Investment Management net revenues increased 9% year-over-year, with AUM reaching $1.6 trillion.
- The Standardized Common Equity Tier 1 capital ratio remained strong at 15.1%.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-QQ3 FY2024filed November 4, 2024Financial Statements
Q3 FY2024 against Q3 FY2023
| Line item | Q3 FY2024Q3 FY2023 | Change |
|---|---|---|
| Net Income | $3.19B$2.41B | +32.4% |
| EPS (Basic) | $1.91$1.39 | +37.4% |
| EPS (Diluted) | $1.88$1.38 | +36.2% |
| Shares Outstanding (Basic) | 1.59B1.62B | −2.2% |
| Shares Outstanding (Diluted) | 1.61B1.64B | −2.1% |
05—Questions
Frequently Asked Questions
How did Morgan Stanley's net revenues and net income perform in Q3 2024 compared to Q3 2023?
Morgan Stanley reported a 16% increase in net revenues to $15.4 billion and a 32% increase in net income applicable to Morgan Stanley common shareholders to $3.2 billion in the third quarter of 2024 compared to the same period in 2023.
What were the key drivers for the performance in the Institutional Securities segment?
The Institutional Securities segment saw a 20% increase in net revenues year-over-year, primarily driven by strong performance in the Equity and Fixed Income businesses due to higher client activity, and by increased underwriting revenues within Investment Banking.
How has the Wealth Management business performed, particularly regarding client assets?
Wealth Management delivered a 14% increase in net revenues year-over-year. The business added $64 billion in net new assets in the quarter, bringing total client assets to $6 trillion as of September 30, 2024. Fee-based assets also grew to $2.3 trillion.
What is Morgan Stanley's capital position as indicated by its CET1 ratio?
Morgan Stanley maintained a strong capital position, reporting a Standardized Common Equity Tier 1 (CET1) capital ratio of 15.1% as of September 30, 2024.
Did the provision for credit losses increase or decrease this quarter?
The provision for credit losses decreased to $79 million in the current quarter from $134 million in the prior year quarter, primarily offset by improvements in the macroeconomic outlook, suggesting a healthier credit environment for the firm.
06—Continue