Morgan Stanley Quarterly Profit Falls 10%
July 18 2019 - 8:09AM
Dow Jones News
By Liz Hoffman
Quarterly profit fell 10% at Morgan Stanley, the last of the big
U.S. banks to report earnings in a mixed quarter where trading
slowed and Main Street banks carried the day.
The bank reported a profit of $2.2 billion, or $1.23 a share, on
$10.24 billion in revenue, both down from a year ago, when it
earned $2.4 billion on $10.6 billion in revenue. Analysts polled by
FactSet had expected a profit of $1.9 billion, or $1.13 a share, on
$10 billion in revenue.
Morgan Stanley, the smallest of the major American banks, is the
last to report earnings in a tough quarter for high finance. Global
trade tensions quieted securities trading and a decline in
longer-term interest rates, spurred by the Federal Reserve's recent
shift to possibly lower rates, caused some corporate borrowers to
pull back.
Instead, consumer businesses drove higher profits at JPMorgan
Chase & Co., Citigroup Inc., Wells Fargo & Co. and Bank of
America Corp. Morgan Stanley has one of the world's largest retail
brokerages but lacks the big mortgage and credit-card operations
that helped rivals in the quarter.
The bank's return on equity, a measure of profitability, was
11.2% in the quarter. Other banks ranged from 10% at Citigroup to
16% at JPMorgan.
Chief Executive James Gorman has steered Morgan Stanley into
steadier businesses since the financial crisis, doubling down on
wealth and asset management and cutting back on riskier kinds of
trading. Earlier this year Morgan Stanley bought a software firm
that helps corporate employees manage their finances, and plans to
build out Morgan Stanley's retirement-account offerings.
Write to Liz Hoffman at liz.hoffman@wsj.com
(END) Dow Jones Newswires
July 18, 2019 07:54 ET (11:54 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
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