Financial Results

Wealth Management Net Revenues Rise At Morgan Stanley

Editorial Staff January 17, 2024

Wealth Management Net Revenues Rise At Morgan Stanley

Full-year figures showed that fee-based asset flows declined for the full year, although the trend shifted in the final quarter.

Morgan Stanley reported yesterday that it had delivered a rise in full-year and fourth-quarter 2023 net revenues for its wealth management business, while fee-based asset flows rose.

The Wall Street firm said Q4 2023 net revenues in wealth management were $6.645 billion, up from $6.626 billion in the same quarter a year earlier. In 2023, net revenue rose to $26.268 billion from $24.417 billion in 2022.

Fee-based client assets stood at $1.983 trillion at the end of December 2023. Fee-based asset flows were $41.6 billion in Q4, doubling from $20.4 billion a year earlier. However, full-year figures showed that these asset flows decelerated to $109.2 billion from $162.8 billion in 2022. Net new assets dipped to $47.5 billion in Q4 2023 from $51.6 billion, the firm said.

The wealth business had a pre-tax margin of 24.9 per cent.

For the Morgan Stanley business across all divisions, net new assets in Q4 were $12.9 billion, up from $12.7 billion a year before. Net income applicable to the firm was $1.5 billion, down from $2.2 billion. Pre-tax income included $535 million of charges. Non-compensation costs rose to $4.846 billion in Q4 from $4.253 billion. The cost efficiency ratio rose to 84 per cent in Q4 from 77 per cent. Costs rose as a result of higher discretionary compensation, partly offset by other factors.

During the reporting period Morgan Stanley announced that its co-president, Edward Pick, was to become its new CEO from the start of 2024, taking over from long-serving predecessor James Gorman. In November it named Jed Finn as the head of its wealth business.

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