Morgan Stanley Fourth Quarter and Full Year 2023 Earnings Results
Morgan Stanley Reports Fourth Quarter Net Revenues of $12.9 Billion, EPS of $0.85 and ROTCE of 8.4%; Full Year Net Revenues of $54.1 Billion, EPS of $5.18 and ROTCE of 12.8%
NEW YORK--(BUSINESS WIRE)--January 16, 2024--
Morgan Stanley (NYSE: MS) today reported net revenues of $12.9 billion for the fourth quarter ended December 31, 2023 compared with $12.7 billion a year ago. Net income applicable to Morgan Stanley was $1.5 billion, or $0.85 per diluted share,(1) compared with $2.2 billion, or $1.26 per diluted share,(1) for the same period a year ago.
Pre-tax income for the fourth quarter includes $535 million of charges or $0.28 per diluted share(1,2) : $286 million related to an FDIC special assessment and a $249 million legal charge related to a specific matter.
Full year net revenues were $54.1 billion compared with $53.7 billion a year ago. Net income applicable to Morgan Stanley was $9.1 billion, or $5.18 per diluted share,(1) compared with $11.0 billion, or $6.15 per diluted share,(1) a year ago.
Ted Pick, Chief Executive Officer, said, “In 2023, the Firm reported a solid ROTCE against a mixed market backdrop and a number of headwinds. We begin 2024 with a clear and consistent business strategy and a unified leadership team. We are focused on achieving our long-term financial goals and continuing to deliver for shareholders.”
Financial Full Year
Summary(3,4) Highlights
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Firm ($MM, except
per share data) 4Q 2023 4Q 2022 FY 2023 FY 2022
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The Firm reported
full year net
revenues of $54.1
billion and net
income of $9.1
billion. The Firm
delivered full year
ROTCE of 12.8%.(5)
The full year Firm
expense efficiency
ratio was 77%.(9)
The full year was
negatively impacted
by expenses related
to severance costs
of $353 million, an
FDIC special
assessment of $286
million, a $249
million legal
charge related to a
specific matter,
and
integration-related
expenses of $293
million.
Standardized Common
Equity Tier 1
capital ratio was
15.2%.(18)
Institutional
Securities reported
full year net
revenues of $23.1
billion reflecting
lower completed
activity in
Investment Banking
and lower results
in Equity and Fixed
Income on reduced
client activity and
a less favorable
market environment
compared to a year
ago. Wealth
Management
delivered full year
net revenues of
$26.3 billion,
reflecting
mark-to-market
gains on
investments
associated with DCP
versus losses a
year ago and higher
net interest
income.(6) The
pre-tax margin was
24.9%.(7,8) The
business added net
new assets of $282
billion,
representing a
full-year 7%
annualized growth
rate from beginning
period assets.(12)
Investment
Management reported
full year net
revenues of $5.4
billion and AUM
increased to $1.5
Net revenues $12,896 $12,749 $54,143 $53,668 trillion.(13)
Provision for
credit losses $3 $87 $532 $280
Compensation
expense $5,951 $5,615 $24,558 $23,053
Non-compensation
expenses $4,846 $4,253 $ 17,240 $16,246
Pre-tax income(7) $2,096 $2,794 $11,813 $14,089
Net income app. to
MS $1,517 $2,236 $9,087 $11,029
Expense efficiency
ratio(9) 84% 77% 77% 73%
Earnings per
diluted share(1) $0.85 $1.26 $5.18 $6.15
Book value per
share $55.50 $54.55 $ 55.50 $54.55
Tangible book
value per share $40.89 $40.06 $ 40.89 $40.06
Return on equity 6.2% 9.2% 9.4% 11.2%
Return on tangible
equity(5) 8.4% 12.6% 12.8% 15.3%
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Institutional
Securities
Net revenues $4,940 $4,800 $23,060 $24,393
Investment Banking $1,318 $1,252 $4,578 $5,235
Equity $2,202 $2,176 $9,986 $10,769
Fixed Income $1,434 $1,418 $7,673 $9,022
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Wealth Management
Net revenues $6,645 $6,626 $26,268 $24,417
Fee-based client
assets ($Bn)(10) $1,983 $1,678 $1,983 $1,678
Fee-based asset
flows ($Bn)(11) $41.6 $20.4 $109.2 $162.8
Net new assets
($Bn)(12) $47.5 $51.6 $282.3 $311.3
Loans ($Bn) $146.5 $146.1 $146.5 $146.1
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Investment
Management
Net revenues $1,464 $1,461 $5,370 $5,375
AUM ($Bn)(13) $1,459 $1,305 $1,459 $1,305
Long-term net
flows ($Bn)(14) $(7.1) $(6.0) $(15.2) $(25.8)
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Fourth Quarter Results