Morgan Stanley’s wealth management unit has posted a pre-tax income from continuing operations of $786m for the first quarter of 2016, down 8% compared to $855m in the year-ago quarter.
The division’s net revenues decreased to $3.7bn from $3.8bn in the prior year, while pre-tax margin was 21%.
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For the quarter ended 31 March 2016, the unit reported asset management fee revenues of $2.1bn, a slight decrease from the prior year due to the impact of lower market levels, partially offset by positive flows.
Transactional revenues dropped to $727m from $950m in the corresponding quarter of 2015, reflecting lower commissions and fees and investment banking revenues on reduced levels of underwriting activity.
The wealth management arm’s net interest income surged 20.6% year-on-year to $831m from $689m, driven by higher deposit and loan balances.
At the end of the quarter, total client assets reached $2 trillion, while client assets in fee based accounts stood at $798bn.
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By GlobalDataThe unit’s 15,888wealth management representatives generated average annualised revenue of $923,000, the bank said in its earnings statement.
According to the bank, wealth management client liabilities were $66bn, a rise of $12bn from a year ago.
Overall, the banking giant has posted net revenues of $7.8bn for the first quarter, compared to $9.9bn in the year-ago quarter.
Morgan Stanley chairman and CEO James Gorman said: "The first quarter was characterized by challenging market conditions and muted client activity. Against that backdrop, our businesses delivered stable results. While we see some signs of market recovery, global uncertainties continue to weigh on investor activity.
"We remain focused on executing against our priorities, helping clients navigate difficult markets while controlling our expenses and managing risk prudently."
