Parent Company (Tables) - Parent Company

12 Months Ended

Dec. 31, 2018

Condensed Income Statements and Comprehensive Income Statements

Parent Company Only—Condensed Income Statements and Comprehensive Income Statements

$ in millions	2018		2017		2016
Revenues
Dividends from subsidiaries¹	$	4,973	$	2,567	$	2,448
Trading		54		(260)		96
Other		(5)		64		38
Total non-interest revenues		5,022		2,371		2,582
Interest income		5,172		3,783		3,008
Interest expense		4,816		4,079		4,036
Net interest		356		(296)		(1,028)
Net revenues		5,378		2,075		1,554
Non-interest expenses		225		240		126
Income before income taxes		5,153		1,835		1,428
Provision for (benefit from) income taxes		22		(206)		(383)
Net income before undistributed gain
of subsidiaries		5,131		2,041		1,811
Undistributed gain of subsidiaries		3,617		4,070		4,168
Net income		8,748		6,111		5,979
OCI, net of tax:
Foreign currency translation adjustments		(114)		219		(23)
Change in net unrealized gains (losses)
on AFS securities		(272)		41		(269)
Pensions, postretirement and other		137		(117)		(100)
Change in net DVA		1,454		(560)		(283)
Comprehensive income	$	9,953	$	5,694	$	5,304
Net income	$	8,748	$	6,111	$	5,979
Preferred stock dividends and other		526		523		471
Earnings applicable to Morgan Stanley
common shareholders	$	8,222	$	5,588	$	5,508

In 2018, we recorded approximately $3 billion of dividends from bank subsidiaries.

Condensed Balance Sheets

Parent Company Only—Condensed Balance Sheets

	AtDecember 31,		AtDecember 31,
$ in millions, except share data	2018		2017
Assets
Cash and cash equivalents:
Cash and due from banks	$	6	$	11
Deposits with bank subsidiaries		7,476		8,120
Restricted cash		—		1
Trading assets at fair value		10,039		5,752
Investment Securities (includes $15,500 and
$13,219 at fair value)		22,588		19,268
Securities purchased under agreement to
resell with affiliates		25,535		38,592
Advances to subsidiaries:
Bank and BHC		30,954		30,145
Non-bank		97,405		112,557
Equity investments in subsidiaries:
Bank and BHC		42,848		35,971
Non-bank		32,418		31,856
Other assets		1,244		2,704
Total assets	$	270,513	$	284,977
Liabilities
Trading liabilities at fair value	$	276	$	148
Securities sold under agreements
to repurchase with affiliates		—		8,753
Payables to and advances from subsidiaries		30,861		28,781
Other liabilities and accrued expenses		2,548		2,421
Borrowings (includes $18,599 and $22,603
at fair value)		156,582		167,483
Total liabilities		190,267		207,586

Commitments and contingent liabilities (see Note 12)				-

Equity
Preferred stock		8,520		8,520
Common stock, $0.01 par value:
Shares authorized: 3,500,000,000; Shares issued: 2,038,893,979; Shares outstanding: 1,699,828,943 and 1,788,086,805 shares

		20		20
Additional paid-in capital		23,794		23,545
Retained earnings		64,175		57,577
Employee stock trusts		2,836		2,907
AOCI		(2,292)		(3,060)
Common stock held in treasury at cost, $0.01 par
value (339,065,036 and 250,807,174 shares)		(13,971)		(9,211)
Common stock issued to employee stock trusts		(2,836)		(2,907)
Total shareholders' equity		80,246		77,391
Total liabilities and equity	$	270,513	$	284,977

Condensed Cash Flow Statements

Parent Company Only—Condensed Cash Flow Statements

$ in millions	2018		2017		2016
Cash flows from operating activities
Net income	$	8,748	$	6,111	$	5,979
Adjustments to reconcile net income to net cash
provided by (used for) operating activities:
Undistributed gain of subsidiaries		(3,617)		(4,070)		(4,168)
Other operating activities		964		1,087		1,367
Changes in assets and liabilities		(7,231)		619		(151)
Net cash provided by (used for)
operating activities		(1,136)		3,747		3,027

Cash flows from investing activities
Proceeds from (payments for):
Investment securities:
Purchases		(8,155)		(5,263)		—
Proceeds from sales		1,252		3,620		—
Proceeds from paydowns and maturities		3,729		1,038		—
Securities purchased under agreements
to resell with affiliates		13,057		19,314		(10,846)
Securities sold under agreements
to repurchase with affiliates		(8,753)		8,753		—
Advances to and investments in subsidiaries¹		11,841		(35,686)		(141)
Net cash provided by (used for)
investing activities		12,971		(8,224)		(10,987)

Cash flows from financing activities
Proceeds from:
Issuance of preferred stock, net of
issuance costs		—		994		—
Issuance of Borrowings		14,918		36,833		32,795
Payments for:
Borrowings		(21,418)		(24,668)		(24,793)
Repurchases of common stock and
employee tax withholdings		(5,566)		(4,292)		(3,933)
Cash dividends		(2,375)		(2,085)		(1,746)
Net change in advances from subsidiaries¹		2,122		1,861		(2,361)
Other financing activities		—		26		66
Net cash provided by (used for)
financing activities		(12,319)		8,669		28
Effect of exchange rate changes on cash
and cash equivalents		(166)		221		(250)
Net increase (decrease) in cash and cash
equivalents		(650)		4,413		(8,182)
Cash and cash equivalents, at beginning of period		8,132		3,719		11,901
Cash and cash equivalents, at end of period	$	7,482	$	8,132	$	3,719

Cash and cash equivalents:
Cash and due from banks	$	6	$	11	$	116
Deposits with bank subsidiaries		7,476		8,120		3,600
Restricted cash		—		1		3
Cash and cash equivalents, at end of period	$	7,482	$	8,132	$	3,719

Supplemental Disclosure of Cash Flow Information

Cash payments for:
Interest	$	4,798	$	3,570	$	3,650
Income taxes, net of refunds		437		201		201

Reclassifications have been made to prior periods to conform to the current presentation.

Borrowings with Original Maturities Greater than One Year

Parent Company’s Borrowings with Original Maturities Greater than One Year

	At		At
	December 31,		December 31,
$ in millions	2018		2017
Senior	$	146,492	$	157,255
Subordinated		10,090		10,228
Total	$	156,582	$	167,483

Obligations under Guarantee Arrangements

Guarantees of Debt Instruments and Warrants Issued by
Subsidiaries
	At		At
	December 31,		December 31,
$ in millions	2018		2017
Aggregate balance	$	24,286	$	19,392

Guarantees under Subsidiary Lease Obligations

	At		At
	December 31,		December 31,
$ in millions	2018		2017
Aggregate balance¹	$	1,003	$	1,082

1. Amounts primarily relate to the U.K.