The New York-based company reported a profit of US$888 million, or 44 cents a share in the three-month period, compared with a loss of US$1 billion, or 55 cents a share, for the same period a year ago. On an adjusted basis, Morgan Stanley's profit was 50 cents a share, a dime higher than the mean analyst estimate.
Morgan Stanley's revenue jumped nearly 50% to US$7.9 billion from US$5.3 billion in last year's third quarter. Excluding a debt valuation adjustment of US$171 million, revenue was US$8.1 billion, compared with US$7.5 billion in the same prior-year period.
“Our results point to the increased consistency, strength and balance we are deriving from our business model," said chairman and chief executive officer James Gorman. "Overall, our stronger year-over-year revenues and net income reflect the progress we have made to position the Firm well for the future."
The bank said wealth management net revenues came to US$3.5 billion and pre-tax margin was 19%. Fee-based asset flows for the quarter were US$15.0 billion and total client assets were US$1.8 trillion at quarter end.
The investment management unit recorded US$828 million in revenue, with US$360 billion in assets under management. Revenue from institutional securities excluding DVA was US$3.9 billion.
Shares are trading 1.2% higher to $29.28 on Friday morning. Morgan Stanley's market value has grown about two-thirds so far this year.