Morgan Stanley reported adjusted earnings for the second quarter on Thursday that slightly beat analysts’ estimates, driven by a strong performance from its wealth management unit and equity sales and trading.
Including charges, the firm reported second-quarter profit of $802 million, or 41 cents a share, up 42 percent from $564 million, or 29 cents a share, in the period a year earlier.
The results, however, were affected by two big charges, one related to Morgan Stanley’s credit spreads and the other to its recent purchase of the remaining stake of its wealth management business. Excluding those charges, the firm had a profit of 45 cents a share, or $872 million. That beat the estimates of analysts polled by Thomson Reuters, which had estimated a profit of 43 cents a share.
Morgan Stanley’s adjusted revenue came in at $8.3 billion in the second quarter, up from $6.6 billion in the period a year earlier.
Morgan Stanley’s chief executive, James P. Gorman, said in a release that he was looking forward to the full benefits of the recently completed Wealth Management acquisition, which the bank took full control of in the quarter.
The second quarter was a particularly important one for Morgan Stanley, which received approval from regulators last month to buy the remaining stake in the wealth management joint venture it formed with Citigroup in the depths of the financial crisis. Since the crisis, Morgan Stanley has tried to diversify its earnings, moving away from risker business like trading, and into wealth management, which offers steady, albeit lower returns. Its ability to purchase all of that division gives it full control over the operation and the full share of the profits.
Morgan Stanley is the last big bank to report second-quarter earnings, and results have been generally strong as banks seem to be benefiting from a pickup in the United States economy. Goldman Sachs, for instance, reported that its net income doubled, beating analyst expectations handily.
