The firm also boosted fee-based asset flows by 30 per cent to $42.5 billion. At the end of the year, total client assets stood at $1.6 trillion while assets in fee-based accounts were $496 billion.

New business activity was not as buoyant towards the end of 2011; the firm reported net new business of $6 billion and asset flows of $4.9 billion in the three months to 31 December.

For the financial year as a whole, the global wealth management group reported pre-tax income of $1.3 billion compared with $1.2 billion in 2010. Net revenues of $13.4 billion increased from $12.6 billion a year ago, which reflected higher asset management and net interest revenues, according to the bank.

At the same time, pre-tax income from continuing operations was $244 million in the fourth quarter compared with $390 million over the same period the year before.

In the assets management business, Morgan Stanley said that it managed or supervised $287 billion on 31 December, up from $272 billion a year earlier.