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Morgan Stanley profits fall is less than feared | Morgan Stanley profits fall is less than feared |
(about 6 hours later) | |
The US bank Morgan Stanley reported a 48% drop in profits in the first quarter of this year - much less than had been feared. | The US bank Morgan Stanley reported a 48% drop in profits in the first quarter of this year - much less than had been feared. |
The New York investment bank earned $736m (£449m), compared with $1.4bn in the first three months of last year. | The New York investment bank earned $736m (£449m), compared with $1.4bn in the first three months of last year. |
The fall was largely down to a sharp drop in revenue from bond trading and losses from a Japanese investment. | The fall was largely down to a sharp drop in revenue from bond trading and losses from a Japanese investment. |
But the earnings were almost 20% higher than analysts forecasts and the shares closed 1.7% higher. | |
Revenue from bond trading was 35% down on the same quarter last year, although 2010 was an unusually strong quarter across Wall Street for that business. | Revenue from bond trading was 35% down on the same quarter last year, although 2010 was an unusually strong quarter across Wall Street for that business. |
Most US banks saw income from that quarter drop over the year, including Goldman Sachs and JPMorgan Chase. | Most US banks saw income from that quarter drop over the year, including Goldman Sachs and JPMorgan Chase. |
Morgan Stanley's chief financial officer Ruth Porat said the division performed well in trading currencies and interest rate products such as government debt: "We're making progress." | Morgan Stanley's chief financial officer Ruth Porat said the division performed well in trading currencies and interest rate products such as government debt: "We're making progress." |
Other aspects of its business performed well. The wealth management group, which is a joint venture with Citigroup saw income rise 85% to $183m. | Other aspects of its business performed well. The wealth management group, which is a joint venture with Citigroup saw income rise 85% to $183m. |
Morgan Stanley's client base rose by 7%. | Morgan Stanley's client base rose by 7%. |
The bank's quarterly results included several one-off items, including an after-tax loss from its stake in a Japanese securities joint venture, and a gain of 30 cents per share from the sale of its stake in a casino project in Atlantic City, New Jersey. | The bank's quarterly results included several one-off items, including an after-tax loss from its stake in a Japanese securities joint venture, and a gain of 30 cents per share from the sale of its stake in a casino project in Atlantic City, New Jersey. |
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