The bank’s senior executives expect the trend to continue as the expenses fall after the integration of its joint brokerage venture with Citigroup.
It was on 8 July 2012 that Morgan Stanley had completed its three-year integration of Citi’s Smith Barney and Morgan Stanley’s wealth unit to form Morgan Stanley Smith Barney as a fully merged unit and technology platform.
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Morgan Stanley owns a 51% stake in the venture.
Further, pre-tax profit margin for the unit increased 3% points from 2011 to 12%, edging closer to the company’s mid-teen target, which it expects to reach by mid-2013.
Profit in the wealth business rose 66% to US$306 million, although revenue declined 4% to US$3.3 billion as a result of less activity among retail investors, whose confidence has been hurt by continued market volatility.
The total client assets were US$1.7 trillion at the quarter end. And client assets in fee-based accounts were US$531 billion, or 30% of total client assets.
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By GlobalDataGlobal fee based asset flows for the quarter was at US$8.7 billion.
