EX-99.1 2 a53881916_ex991.htm EXHIBIT 99.1
Exhibit 99.1



Morgan Stanley Fourth Quarter and Full Year 2023 Earnings Results

Morgan Stanley Reports Fourth Quarter Net Revenues of $12.9 Billion, EPS of $0.85 and ROTCE of 8.4%; Full Year Net Revenues of $54.1 Billion, EPS of $5.18 and ROTCE of 12.8%

NEW YORK, January 16, 2024 – Morgan Stanley (NYSE: MS) today reported net revenues of $12.9 billion for the fourth quarter ended December 31, 2023 compared with $12.7 billion a year ago. Net income applicable to Morgan Stanley was $1.5 billion, or $0.85 per diluted share,1 compared with $2.2 billion, or $1.26 per diluted share,1 for the same period a year ago.

Pre-tax income for the fourth quarter includes $535 million of charges or $0.28 per diluted share1,2: $286 million related to an FDIC special assessment and a $249 million legal charge related to a specific matter.

Full year net revenues were $54.1 billion compared with $53.7 billion a year ago. Net income applicable to Morgan Stanley was $9.1 billion, or $5.18 per diluted share,1 compared with $11.0 billion, or $6.15 per diluted share,1 a year ago.


Ted Pick, Chief Executive Officer, said, “In 2023, the Firm reported a solid ROTCE against a mixed market backdrop and a number of headwinds. We begin 2024 with a clear and consistent business strategy and a unified leadership team. We are focused on achieving our long-term financial goals and continuing to deliver for shareholders.”



Financial Summary3,4
                        
Firm ($MM, except per share data)
  
4Q 2023
    
4Q 2022
    
FY 2023
    
FY 2022
  
                         
Net revenues
  
$
12,896
    
$
12,749
    
$
54,143
    
$
53,668
  
Provision for credit losses
  
$
3
    
$
87
    
$
532
    
$
280
  
Compensation expense
  
$
5,951
    
$
5,615
    
$
24,558
    
$
23,053
  
Non-compensation expenses
  
$
4,846
    
$
4,253
    
$
17,240
    
$
16,246
  
Pre-tax income7
  
$
2,096
    
$
2,794
    
$
11,813
    
$
14,089
  
Net income app. to MS
  
$
1,517
    
$
2,236
    
$
9,087
    
$
11,029
  
Expense efficiency ratio9
    
84
%
    
77
%
    
77
%
    
73
%
Earnings per diluted share1
  
$
0.85
    
$
1.26
    
$
5.18
    
$
6.15
  
Book value per share
  
$
55.50
    
$
54.55
    
$
55.50
    
$
54.55
  
Tangible book value per share
  
$
40.89
    
$
40.06
    
$
40.89
    
$
40.06
  
Return on equity
    
6.2
%
    
9.2
%
    
9.4
%
    
11.2
%
Return on tangible equity5
    
8.4
%
    
12.6
%
    
12.8
%
    
15.3
%
Institutional Securities
                                
Net revenues
  
$
4,940
    
$
4,800
    
$
23,060
    
$
24,393
  
Investment Banking
  
$
1,318
    
$
1,252
    
$
4,578
    
$
5,235
  
Equity
  
$
2,202
    
$
2,176
    
$
9,986
    
$
10,769
  
Fixed Income
  
$
1,434
    
$
1,418
    
$
7,673
    
$
9,022
  
Wealth Management
                                
Net revenues
  
$
6,645
    
$
6,626
    
$
26,268
    
$
24,417
  
Fee-based client assets ($Bn)10
  
$
1,983
    
$
1,678
    
$
1,983
    
$
1,678
  
Fee-based asset flows ($Bn)11
  
$
41.6
    
$
20.4
    
$
109.2
    
$
162.8
  
Net new assets ($Bn)12
  
$
47.5
    
$
51.6
    
$
282.3
    
$
311.3
  
Loans ($Bn)
  
$
146.5
    
$
146.1
    
$
146.5
    
$
146.1
  
Investment Management
                                
Net revenues
  
$
1,464
    
$
1,461
    
$
5,370
    
$
5,375
  
AUM ($Bn)13
  
$
1,459
    
$
1,305
    
$
1,459
    
$
1,305
  
Long-term net flows ($Bn)14
  
$
(7.1
)
  
$
(6.0
)
  
$
(15.2
)
  
$
(25.8
)

Full Year Highlights
 
 
•
The Firm reported full year net revenues of $54.1 billion and net income of $9.1 billion.
 
 
•
The Firm delivered full year ROTCE of 12.8%.5
 
 
•
The full year Firm expense efficiency ratio was 77%.9 The full year was negatively impacted by expenses related to severance costs of $353 million, an FDIC special assessment of $286 million, a $249 million legal charge related to a specific matter, and integration-related expenses of $293 million.
   
•
Standardized Common Equity Tier 1 capital ratio was 15.2%.18
 
 
•
Institutional Securities reported full year net revenues of $23.1 billion reflecting lower completed activity in Investment Banking and lower results in Equity and Fixed Income on reduced client activity and a less favorable market environment compared to a year ago.
 
 
•
Wealth Management delivered full year net revenues of $26.3 billion, reflecting mark-to-market gains on investments associated with DCP versus losses a year ago and higher net interest income.6 The pre-tax margin was 24.9%.7,8 The business added net new assets of $282 billion, representing a full-year 7% annualized growth rate from beginning period assets.12
 
 
•
Investment Management reported full year net revenues of $5.4 billion and AUM increased to $1.5 trillion.13
 


Media Relations: Wesley McDade   212-761-2430
Investor Relations: Leslie Bazos   212-761-5352

 
Fourth Quarter Results

Institutional Securities

Institutional Securities reported net revenues for the current quarter of $4.9 billion compared with $4.8 billion a year ago. Pre-tax income was $408 million compared with $748 million a year ago.7

Investment Banking revenues up 5% from a year ago:

•
Advisory revenues were essentially unchanged from a year ago reflecting completed M&A activity in the current quarter.

•
Equity underwriting revenues were essentially unchanged  from a year ago.

•
Fixed income underwriting revenues increased 25% from a year ago on higher investment grade issuances.

Equity net revenues:

•
Equity net revenues were essentially unchanged from a year ago. The absence of markdowns on certain strategic investments versus a year ago were offset by increased funding and liquidity costs.

Fixed Income net revenues:

•
Fixed Income net revenues were essentially unchanged versus a year ago reflecting higher revenues in commodities driven by improved market conditions and increased client activity partially offset by lower results in credit products.

Other:

•
Other revenues for the quarter reflect mark-to-market losses on corporate loans, inclusive of loan hedges, of $405 million. These losses were partially offset by net interest income and fees on corporate loans of $248 million, mark-to-market gains on DCP and revenues from our Japanese securities joint venture.

($ millions)
  
4Q 2023
    
4Q 2022
  
             
Net Revenues
  
$
4,940
    
$
4,800
  
                 
Investment Banking
  
$
1,318
    
$
1,252
  
Advisory
  
$
702
    
$
711
  
Equity underwriting
  
$
225
    
$
227
  
Fixed income underwriting
  
$
391
    
$
314
  
                 
Equity
  
$
2,202
    
$
2,176
  
Fixed Income
  
$
1,434
    
$
1,418
  
Other
  
$
(14
)
  
$
(46
)
                 
Provision for credit losses
  
$
22
    
$
61
  
                 
Total Expenses
  
$
4,510
    
$
3,991
  
Compensation
  
$
1,732
    
$
1,644
  
Non-compensation
  
$
2,778
    
$
2,347
  
 
Total Expenses:

•
Compensation expense increased from a year ago reflecting higher discretionary compensation, partially offset by lower expenses related to outstanding deferred equity compensation and significantly lower severance costs due to an employee action a year ago.

•
Non-compensation expenses increased from a year ago primarily driven by higher legal expenses including a specific matter of $249 million and an FDIC special assessment of $121 million.15

2

Wealth Management

Wealth Management net revenues of $6.6 billion in the current quarter were essentially unchanged from a year ago. Pre-tax income of $1.4 billion7 in the current quarter resulted in a pre-tax margin of 21.5%.8

Net revenues:

•
Asset management revenues increased from a year ago reflecting higher asset levels and the impact of positive fee-based flows.

•
Transactional revenues were essentially unchanged excluding the impact of mark-to-market on investments associated with DCP.6,16

•
Net interest income decreased from a year ago driven by changes in deposit mix, partially offset by higher interest rates.

Total Expenses:

•
Compensation expense increased from a year ago driven by higher compensable revenues and higher expenses related to DCP.6

•
Non-compensation expenses increased from a year ago primarily driven by an FDIC special assessment of $165 million, partially offset by lower marketing and business development costs.15

($ millions)
  
4Q 2023
    
4Q 2022
  
Net Revenues
  
$
6,645
    
$
6,626
  
Asset management
  
$
3,556
    
$
3,347
  
Transactional
  
$
1,088
    
$
931
  
Net interest
  
$
1,852
    
$
2,138
  
Other
  
$
149
    
$
210
  
Provision for credit losses
  
$
(19
)
  
$
26
  
Total Expenses
  
$
5,236
    
$
4,760
  
Compensation
  
$
3,640
    
$
3,343
  
Non-compensation
  
$
1,596
    
$
1,417
  
                 
 
Investment Management

Investment Management net revenues of $1.5 billion were essentially unchanged from a year ago. Pre-tax income was $265 million compared with $214 million a year ago.7

Net revenues:

•
Asset management and related fees increased from a year ago on higher average AUM driven by increased asset values.

•
Performance-based income and other revenues decreased from a year ago primarily due to lower accrued carried interest in our private funds partially offset by mark-to-market gains on public investments compared to losses a year ago.

Total Expenses:

•
Compensation expense decreased from a year ago, primarily driven by lower compensation associated with carried interest.
 
($ millions)
  
4Q 2023
    
4Q 2022
  
Net Revenues
  
$
1,464
    
$
1,461
  
Asset management and related fees
  
$
1,403
    
$
1,371
  
Performance-based income and other
  
$
61
    
$
90
  
Total Expenses
  
$
1,199
    
$
1,247
  
Compensation
  
$
579
    
$
628
  
Non-compensation
  
$
620
    
$
619
  
                 
 

3

Full Year Results

Institutional Securities

Institutional Securities reported net revenues of $23.1 billion compared with $24.4 billion a year ago. Pre-tax income was $4.5 billion compared with $6.7 billion a year ago.7

Investment Banking revenues down 13%:

•
Advisory revenues decreased driven by fewer completed M&A transactions on lower market volumes.

•
Equity underwriting revenues were essentially unchanged. Higher secondary and convertible offerings were offset by lower IPOs.

•
Fixed income underwriting revenues were essentially unchanged from a year ago as higher investment grade issuances were offset by lower non-investment grade issuances.

Equity net revenues down 7%:

•
Equity net revenues decreased across businesses primarily on lower client activity and increased funding and liquidity costs compared to a year ago.

Fixed Income net revenues down 15%:

•
Fixed Income net revenues decreased from a strong prior year, primarily driven by declines in foreign exchange and commodities on less favorable market conditions and lower client activity.

Other:

•
Other revenues for the year reflect net interest income and fees on corporate loans of $1 billion and revenues from our Japanese securities joint venture, partially offset by mark-to-market losses on corporate loans, inclusive of loan hedges, of $577 million.
 
($ millions)
  
FY 2023
    
FY 2022
  
Net Revenues
  
$
23,060
    
$
24,393
  
                 
Investment Banking
  
$
4,578
    
$
5,235
  
Advisory
  
$
2,244
    
$
2,946
  
Equity underwriting
  
$
889
    
$
851
  
Fixed income underwriting
  
$
1,445
    
$
1,438
  
                 
Equity
  
$
9,986
    
$
10,769
  
Fixed Income
  
$
7,673
    
$
9,022
  
Other
  
$
823
    
$
(633
)
                 
Provision for credit losses
  
$
401
    
$
211
  
                 
Total Expenses
  
$
18,183
    
$
17,467
  
Compensation
  
$
8,369
    
$
8,246
  
Non-compensation
  
$
9,814
    
$
9,221
  
                 
 
Provision for credit losses:

•
Provision for credit losses increased from a year ago primarily driven by deteriorating conditions in the commercial real estate sector, including provisions for certain specific commercial real estate loans.

Total Expenses:

•
Compensation expense was essentially unchanged from a year ago as higher expenses related to DCP and stock-based compensation plans were offset by lower expenses related to outstanding deferred equity compensation.6

•
Non-compensation expenses increased from a year ago on investments in technology, an FDIC special assessment of $121 million, and higher legal costs inclusive of $249 million related to a specific matter.15

4

Wealth Management

Wealth Management reported net revenues of $26.3 billion compared with $24.4 billion a year ago. Pre-tax income of $6.5 billion7 in the current year resulted in a pre-tax margin of 24.9%.8

Net revenues up 8%:

•
Asset management revenues increased from a year ago on positive fee-based flows, partially offset by a reduction driven by lower average asset levels due to declines in the markets and changes in the mix of existing client portfolios.

•
Transactional revenues were essentially unchanged excluding the impact of mark-to-market gains of $282 million in the current year versus mark-to-market losses of $858 million a year ago on investments associated with DCP.6,16

•
Net interest income increased from a year ago on higher interest rates, partially offset by changes in deposit mix.

Provision for Credit Losses:

•
Provision for credit losses increased from a year ago primarily driven by deteriorating conditions in the commercial real estate sector, including provisions for specific commercial real estate loans.

($ millions)
  
FY 2023
    
FY 2022
  
Net Revenues
  
$
26,268
    
$
24,417
  
Asset management
  
$
14,019
    
$
13,872
  
Transactional
  
$
3,556
    
$
2,473
  
Net interest
  
$
8,118
    
$
7,429
  
Other
  
$
575
    
$
643
  
Provision for credit losses
  
$
131
    
$
69
  
Total Expenses
  
$
19,607
    
$
17,765
  
Compensation
  
$
13,972
    
$
12,534
  
Non-compensation
  
$
5,635
    
$
5,231
  
                 
 
Total Expenses:

•
Compensation expense increased driven by higher expenses related to DCP versus a year ago.6

•
Non-compensation expenses increased primarily driven by an FDIC special assessment of $165 million and higher technology expenses and costs related to exits of real estate.15

Investment Management

Investment Management net revenues of $5.4 billion were essentially unchanged from a year ago. Pre-tax income was $842 million compared with $807 million a year ago.7

Net revenues:

•
Asset management and related fees decreased due to a shift in the mix of average AUM, driven by the cumulative effect of net flows.13

•
Performance-based income and other revenues increased from a year ago on mark-to-market gains compared to losses a year ago on investments associated with DCP and on public investments, partially offset by lower accrued carried interest in our private funds.6
 
($ millions)
  
FY 2023
    
FY 2022
  
Net Revenues
  
$
5,370
    
$
5,375
  
Asset management and related fees
  
$
5,231
    
$
5,332
  
Performance-based income and other
  
$
139
    
$
43
  
                 
Total Expenses
  
$
4,528
    
$
4,568
  
Compensation
  
$
2,217
    
$
2,273
  
Non-compensation
  
$
2,311
    
$
2,295
  
                 
 
Total Expenses:

•
Compensation expense decreased from a year ago driven by lower compensation associated with carried interest, partially offset by gains related to DCP compared with losses a year ago.6

5

Other Matters
 
•
The Firm repurchased $1.3 billion of its outstanding common stock during the quarter, and $5.3 billion during the year as part of its Share Repurchase Program.

•
The Board of Directors declared a $0.85 quarterly dividend per share, payable on February 15, 2024 to common shareholders of record on January 31, 2024.

•
The effective tax rate for the current quarter was 26.5% and for the full year was 21.9%. The higher current quarter rate primarily reflects the non-deductibility of a specific legal matter.


  4Q 2023
   
4Q 2022
    
FY 2023
    
FY 2022
  
Common Stock Repurchases
  
Repurchases ($MM)
  
$
1,300
    
$
1,700
    
$
5,300
    
$
9,865
  
Number of Shares (MM)
    
17
      
20
      
62
      
113
  
Average Price
  
$
75.23
    
$
86.07
    
$
85.35
    
$
87.25
  
Period End Shares (MM)
    
1,627
      
1,675
      
1,627
      
1,675
  
Tax Rate
    
26.5
%
    
18.9
%
    
21.9
%
    
20.7
%
Capital17
                                
Standardized Approach
                                
CET1 capital18
    
15.2
%
    
15.3
%
                
Tier 1 capital18
    
17.1
%
    
17.2
%
                
Advanced Approach
                                
CET1 capital18
    
15.4
%
    
15.6
%
                
Tier 1 capital18
    
17.4
%
    
17.6
%
                
Leveraged-based capital
                                
Tier 1 leverage19
    
6.7
%
    
6.7
%
                
SLR20
    
5.5
%
    
5.5
%
                
                                 


6

Morgan Stanley is a leading global financial services firm providing a wide range of investment banking, securities, wealth management and investment management services. With offices in 42 countries, the Firm’s employees serve clients worldwide including corporations, governments, institutions and individuals. For further information about Morgan Stanley, please visit www.morganstanley.com.

A financial summary follows. Financial, statistical and business-related information, as well as information regarding business and segment trends, is included in the financial supplement. Both the earnings release and the financial supplement are available online in the Investor Relations section at www.morganstanley.com.

NOTICE:

The information provided herein and in the financial supplement, including information provided on the Firm’s earnings conference calls, may include certain non-GAAP financial measures. The definition of such measures or reconciliation of such measures to the comparable U.S. GAAP figures are included in this earnings release and the financial supplement, both of which are available on www.morganstanley.com.

This earnings release may contain forward-looking statements, including the attainment of certain financial and other targets, objectives and goals. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date on which they are made, which reflect management’s current estimates, projections, expectations, assumptions, interpretations or beliefs and which are subject to risks and uncertainties that may cause actual results to differ materially. For a discussion of risks and uncertainties that may affect the future results of the Firm, please see “Forward-Looking Statements” preceding Part I, Item 1, “Competition” and “Supervision and Regulation” in Part I, Item 1, “Risk Factors” in Part I, Item 1A, “Legal Proceedings” in Part I, Item 3, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 and “Quantitative and Qualitative Disclosures about Risk” in Part II, Item 7A in the Firm’s Annual Report on Form 10-K for the year ended December 31, 2022 and other items throughout the Form 10-K, the Firm’s Quarterly Reports on Form 10-Q and the Firm’s Current Reports on Form 8-K, including any amendments thereto.

7

1 Includes preferred dividends related to the calculation of earnings per share for the fourth quarter of 2023 and 2022 of approximately $134 million and $123 million, respectively. Includes preferred dividends related to the calculation of earnings per share for the years ended 2023 and 2022 of approximately $557 million and $489 million, respectively.
2 The Firm recorded a one-time FDIC Special Assessment of $286 million pre-tax ($218 million post-tax) and a legal charge related to a specific matter of $249 million pre-tax ($234 million post-tax) which negatively impacted earnings per diluted shares by $0.28.

3 The Firm prepares its Consolidated Financial Statements using accounting principles generally accepted in the United States (U.S. GAAP). From time to time, Morgan Stanley may disclose certain “non-GAAP financial measures” in the course of its earnings releases, earnings conference calls, financial presentations and otherwise. The Securities and Exchange Commission defines a “non-GAAP financial measure” as a numerical measure of historical or future financial performance, financial position, or cash flows that is subject to adjustments that effectively exclude, or include amounts from the most directly comparable measure calculated and presented in accordance with U.S. GAAP. Non-GAAP financial measures disclosed by Morgan Stanley are provided as additional information to analysts, investors and other stakeholders in order to provide them with greater transparency about, or an alternative method for assessing our financial condition, operating results, or capital adequacy. These measures are not in accordance with, or a substitute for U.S. GAAP, and may be different from or inconsistent with non-GAAP financial measures used by other companies. Whenever we refer to a non-GAAP financial measure, we will also generally define it or present the most directly comparable financial measure calculated and presented in accordance with U.S. GAAP, along with a reconciliation of the differences between the non-GAAP financial measure we reference and such comparable U.S. GAAP financial measure.
4 Our earnings releases, earnings conference calls, financial presentations and other communications may also include certain metrics which we believe to be useful to us, analysts, investors, and other stakeholders by providing further transparency about, or an additional means of assessing, our financial condition and operating results.
5 Return on average tangible common equity is a non-GAAP financial measure that the Firm considers useful for analysts, investors and other stakeholders to allow comparability of period-to-period operating performance and capital adequacy. The calculation of return on average tangible common equity represents full year or annualized net income applicable to Morgan Stanley less preferred dividends as a percentage of average tangible common equity. Tangible common equity, also a non-GAAP financial measure, represents common equity less goodwill and intangible assets net of allowable mortgage servicing rights deduction.
6 “DCP” refers to certain employee deferred cash-based compensation programs. Please refer to "Management’s Discussion and Analysis of Financial Condition and Results of Operations – Other Matters – Deferred Cash-Based Compensation” in the Firm’s Annual Report on Form 10-K for the year ended December 31, 2022.
7 Pre-tax income represents income before provision for income taxes.
8 Pre-tax margin represents income before provision for income taxes divided by net revenues.
9 The expense efficiency ratio represents total non-interest expenses as a percentage of net revenues.
10 Wealth Management fee-based client assets represent the amount of assets in client accounts where the basis of payment for services is a fee calculated on those assets.
11 Wealth Management fee-based asset flows include net new fee-based assets (including asset acquisitions), net account transfers, dividends, interest, and client fees, and exclude institutional cash management related activity.
12 Wealth Management net new assets represent client inflows, including dividends and interest, and asset acquisitions, less client outflows, and exclude activity from business combinations/divestitures and the impact of fees and commissions.
13 AUM is defined as assets under management or supervision.
14 Long-term net flows include the Equity, Fixed Income and Alternative and Solutions asset classes and excludes the Liquidity and Overlay Services asset class.
15 Following the failures of certain banks and resulting losses to the FDIC’s Deposit Insurance Fund in the first half of 2023, the FDIC adopted a final rule on November, 16 2023 to implement a special assessment to recover the cost associated with protecting uninsured depositors. We recorded the cost of the entire special assessment of $286 million in the fourth quarter of 2023. Of the $286 million, $121 million was recorded in the Institutional Securities segment and $165 million was recorded in the Wealth Management segment.

8

16 Transactional revenues include investment banking, trading, and commissions and fee revenues.
17 Capital ratios are estimates as of the press release date, January 16, 2024.
18 CET1 capital is defined as Common Equity Tier 1 capital. The Firm’s risk-based capital ratios are computed under each of the (i) standardized approaches for calculating credit risk and market risk risk‐weighted assets (RWAs) (the “Standardized Approach”) and (ii) applicable advanced approaches for calculating credit risk, market risk and operational risk RWAs (the “Advanced Approach”). For information on the calculation of regulatory capital and ratios, and associated regulatory requirements, please refer to "Management’s Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resources – Regulatory Requirements" in the Firm’s Annual Report on Form 10-K for the year ended December 31, 2022.

19 The Tier 1 leverage ratio is a leverage-based capital requirement that measures the Firm’s leverage. Tier 1 leverage ratio utilizes Tier 1 capital as the numerator and average adjusted assets as the denominator.
20 The Firm’s supplementary leverage ratio (SLR) utilizes a Tier 1 capital numerator of approximately $78.2 billion and $77.2 billion, and supplementary leverage exposure denominator of approximately $1.43 trillion and $1.40 trillion, for the fourth quarter of 2023 and 2022, respectively.

9
Consolidated Income Statement Information
  
(unaudited, dollars in millions)
  
                                                 
   
Quarter Ended
    
Percentage Change From:
    
Twelve Months Ended
    
Percentage
  
   
Dec 31, 2023
    
Sep 30, 2023
    
Dec 31, 2022
    
Sep 30, 2023
    
Dec 31, 2022
    
Dec 31, 2023
    
Dec 31, 2022
    
Change
  
Revenues:
                                                
Investment banking
  
$
1,415
    
$
1,048
    
$
1,318
      
35
%
    
7
%
  
$
4,948
    
$
5,599
      
(12
%)
Trading
    
3,305
      
3,679
      
3,017
      
(10
%)
    
10
%
    
15,263
      
13,928
      
10
%
Investments
    
189
      
144
      
85
      
31
%
    
122
%
    
573
      
15
      
*
  
Commissions and fees
    
1,110
      
1,098
      
1,169
      
1
%
    
(5
%)
    
4,537
      
4,938
      
(8
%)
Asset management
    
5,041
      
5,031
      
4,803
      
--
      
5
%
    
19,617
      
19,578
      
--
  
Other
    
(61
)
    
296
      
38
      
*
      
*
      
975
      
283
      
*
  
Total non-interest revenues
    
10,999
      
11,296
      
10,430
      
(3
%)
    
5
%
    
45,913
      
44,341
      
4
%
                                                                 
Interest income
    
14,058
      
13,305
      
9,232
      
6
%
    
52
%
    
50,281
      
21,595
      
133
%
Interest expense
    
12,161
      
11,328
      
6,913
      
7
%
    
76
%
    
42,051
      
12,268
      
*
  
Net interest
    
1,897
      
1,977
      
2,319
      
(4
%)
    
(18
%)
    
8,230
      
9,327
      
(12
%)
Net revenues
    
12,896
      
13,273
      
12,749
      
(3
%)
    
1
%
    
54,143
      
53,668
      
1
%
                                                                 
Provision for credit losses
    
3
      
134
      
87
      
(98
%)
    
(97
%)
    
532
      
280
      
90
%
                                                                 
Non-interest expenses:
                                                                
Compensation and benefits
    
5,951
      
5,935
      
5,615
      
--
      
6
%
    
24,558
      
23,053
      
7
%
                                                                 
Non-compensation expenses:
                                                                
Brokerage, clearing and exchange fees
    
865
      
855
      
851
      
1
%
    
2
%
    
3,476
      
3,458
      
1
%
Information processing and communications
    
987
      
947
      
933
      
4
%
    
6
%
    
3,775
      
3,493
      
8
%
Professional services
    
822
      
759
      
853
      
8
%
    
(4
%)
    
3,058
      
3,070
      
--
  
Occupancy and equipment
    
528
      
456
      
443
      
16
%
    
19
%
    
1,895
      
1,729
      
10
%
Marketing and business development
    
224
      
191
      
295
      
17
%
    
(24
%)
    
898
      
905
      
(1
%)
Other
    
1,420
      
851
      
878
      
67
%
    
62
%
    
4,138
      
3,591
      
15
%
Total non-compensation expenses
    
4,846
      
4,059
      
4,253
      
19
%
    
14
%
    
17,240
      
16,246
      
6
%
                                                                 
Total non-interest expenses
    
10,797
      
9,994
      
9,868
      
8
%
    
9
%
    
41,798
      
39,299
      
6
%
                                                                 
Income before provision for income taxes
    
2,096
      
3,145
      
2,794
      
(33
%)
    
(25
%)
    
11,813
      
14,089
      
(16
%)
Provision for income taxes
    
555
      
710
      
528
      
(22
%)
    
5
%
    
2,583
      
2,910
      
(11
%)
Net income
  
$
1,541
    
$
2,435
    
$
2,266
      
(37
%)
    
(32
%)
  
$
9,230
    
$
11,179
      
(17
%)
Net income applicable to nonredeemable noncontrolling interests
    
24
      
27
      
30
      
(11
%)
    
(20
%)
    
143
      
150
      
(5
%)
Net income applicable to Morgan Stanley
    
1,517
      
2,408
      
2,236
      
(37
%)
    
(32
%)
    
9,087
      
11,029
      
(18
%)
Preferred stock dividend
    
134
      
146
      
123
      
(8
%)
    
9
%
    
557
      
489
      
14
%
Earnings applicable to Morgan Stanley common shareholders
  
$
1,383
    
$
2,262
    
$
2,113
      
(39
%)
    
(35
%)
  
$
8,530
    
$
10,540
      
(19
%)
   

Notes:
-
Firm net revenues excluding mark-to-market gains and losses on deferred cash-based compensation plans (DCP) were: 4Q23: $12,527 million, 3Q23: $13,475 million, 4Q22: $12,555 million, 4Q23 YTD: $53,709 million, 4Q22 YTD: $54,866 million.
-
Firm compensation expenses excluding DCP were: 4Q23: $5,597 million, 3Q23: $5,992 million, 4Q22: $5,426 million, 4Q23 YTD: $23,890 million, 4Q22 YTD: $23,769 million.
-
The End Notes are an integral part of this presentation. Refer to pages 12 - 17 of the Financial Supplement for Definition of U.S. GAAP to Non-GAAP Measures, Definition of Performance Metrics and Terms, Supplemental Quantitative Details and Calculations, and Legal Notice.

10
Consolidated Financial Metrics, Ratios and Statistical Data
  
(unaudited)
  
   
Quarter Ended
    
Percentage Change From:
    
Twelve Months Ended
    
Percentage
  
   
Dec 31, 2023
    
Sep 30, 2023
    
Dec 31, 2022
    
Sep 30, 2023
    
Dec 31, 2022
    
Dec 31, 2023
    
Dec 31, 2022
    
Change
  
                                                 
Financial Metrics:
                                                
                                                 
Earnings per basic share
  
$
0.86
    
$
1.39
    
$
1.28
      
(38
%)
    
(33
%)
  
$
5.24
    
$
6.23
      
(16
%)
Earnings per diluted share
  
$
0.85
    
$
1.38
    
$
1.26
      
(38
%)
    
(33
%)
  
$
5.18
    
$
6.15
      
(16
%)
                                                                 
Return on average common equity
    
6.2
%
    
10.0
%
    
9.2
%
                    
9.4
%
    
11.2
%
        
Return on average tangible common equity
    
8.4
%
    
13.5
%
    
12.6
%
                    
12.8
%
    
15.3
%
        
                                                                 
Book value per common share
  
$
55.50
    
$
55.08
    
$
54.55
                    
$
55.50
    
$
54.55
          
Tangible book value per common share
  
$
40.89
    
$
40.53
    
$
40.06
                    
$
40.89
    
$
40.06
          
                                                                 
Financial Ratios:
                                                                
                                                                 
Pre-tax profit margin
    
16
%
    
24
%
    
22
%
                    
22
%
    
26
%
        
Compensation and benefits as a % of net revenues
    
46
%
    
45
%
    
44
%
                    
45
%
    
43
%
        
Non-compensation expenses as a % of net revenues
    
38
%
    
31
%
    
33
%
                    
32
%
    
30
%
        
Firm expense efficiency ratio
    
84
%
    
75
%
    
77
%
                    
77
%
    
73
%
        
Effective tax rate
    
26.5
%
    
22.6
%
    
18.9
%
                    
21.9
%
    
20.7
%
        
                                                                 
Statistical Data:
                                                                
                                                                 
Period end common shares outstanding (millions)
    
1,627
      
1,642
      
1,675
      
(1
%)
    
(3
%)
                        
Average common shares outstanding (millions)
                                                          
Basic
    
1,606
      
1,624
      
1,652
      
(1
%)
    
(3
%)
    
1,628
      
1,691
      
(4
%)
Diluted
    
1,627
      
1,643
      
1,679
      
(1
%)
    
(3
%)
    
1,646
      
1,713
      
(4
%)
                                                                 
Worldwide employees
    
80,006
      
80,710
      
82,427
      
(1
%)
    
(3
%)
                        

   

The End Notes are an integral part of this presentation. Refer to pages 12 - 17 of the Financial Supplement for Definition of U.S. GAAP to Non-GAAP Measures, Definition of Performance Metrics and Terms, Supplemental Quantitative Details and Calculations, and Legal Notice.


11