Morgan Stanley (NYSE:MS) today posted a set of robust results for the first quarter of 2021.
Institutional Securities reported net revenues for the current quarter of $8.6 billion compared with $5.2 billion a year ago. The result was also stronger than the $7.0 billion in revenues reported for the final quarter of 2020.
Pre-tax income was $3.4 billion compared with $950 million a year ago.
Equity net revenues increased from a year ago reflecting strong performance across products and geographies, with notable strength in derivatives, driven by continued client engagement and elevated volumes. The current quarter includes a loss of $644 million related to a credit event for a single prime brokerage client, and $267 million of subsequent trading losses through the end of the quarter related to the same event.
Wealth Management reported net revenues for the current quarter of $6.0 billion compared with $4.1 billion from a year ago. Pre-tax income of $1.6 billion in the current quarter resulted in a reported pre-tax margin of 26.9% or 27.9% excluding the impact of integration-related expenses.
The comparisons of current year results to prior periods were impacted by the acquisition of E*TRADE. The Firm’s first quarter results include $75 million of integration-related expenses on a pre-tax basis ($58 million after-tax) as a result of the E*TRADE and Eaton Vance acquisitions. The integration-related expenses include $33 million in compensation expense and $42 million in non-compensation expense.
Across all segments, net revenues for the first quarter of 2021 amounted to $15.7 billion compared with $9.8 billion a year ago. Net income applicable to Morgan Stanley was $4.1 billion, or $2.19 per diluted share, compared with net income of $1.7 billion, or $1.01 per diluted share, for the same period a year ago.