Morgan Stanley has seen growth in its investment banking business in 2015, though its fixed income and commodities sales have suffered.
In its full-year results statement today, Morgan Stanley announced revenue of $7.74 billion in Q4 2015, down from $7.76 billion in the previous year. But net income increased from a loss of $1.63 billion in Q4 2014 to $908 million in the final three months of 2015.
For 2015 as a whole, revenue increased slightly from $34.27 billion in 2014 to $35.15 billion last year. However, as a result of legal costs incurred in 2014, pre-tax profits in 2015 almost doubled to $6.13 billion.
The firm’s institutional securities business reported a slight decrease in net revenue in Q4 2015 of $3.42 billion, down from $3.43 billion in the same quarter of 2014. However, while the final quarter of 2014 saw huge losses of $3.6 billion, largely on the back of litigation costs of $3.1 billion, Q4 2015 was profitable with pre-tax income of $584 million.
Equity sales were healthy with net revenues of $1.8 billion, up from $1.6 billion a year earlier. Its advisory business also benefited from increased M&A activity, increasing revenue from $516 million to $488 million over the period. However equity underwriting revenues were static and fixed income underwriting fell substantially from $462 million in Q4 2014 to $346 million in Q4 2015.
The bank’s Fixed Income & Commodities division – which hit the news at the beginning of this year after several senior figures departed the department as part of major job cuts set to total 1,200 worldwide – saw an expected drop in performance. Sales fell from $599 million to $550 million, which the bank said reflected challenging market conditions.