Morgan Stanley (MS) reported a loss from continuing operations of $227 million, or $0.14 per share, vs. net income of $871 million, or $0.44 per share, for the same period a year ago–topping analysts' forecasts. The loss was tied to a $1.7 billion legal settlement and issues related to MBIA and credit-default swaps.
The company, led by James Gorman, said its revenue for the period fell to $5.7 billion from $9.9 billion in the previous quarter and $7.7 billion a year ago. Much of the decline was reported by the institutional-securities unit.
Its wealth-management unit saw its flows of net new assets drop about 60% from both the third quarter and the year-ago period to $6 billion. Flows in fee-based asset accounts were down 51% sequentially and 61% year over year to $4.9 billion.
Rival Bank of America (BAC) reported a similar amount of net new assets in the fourth quarter, roughly $5.5 billion, for its global-wealth operations, which include Merrill Lynch.
Morgan Stanley, which says it moved to streamline the job descriptions of advisors and staff at its legacy Morgan Stanley and Smith Barney channels, had a pre-adjusted total of 17,156 financial advisors as of Dec. 30.–and 17,649 advisors after accounting for the adjustment.
Overall, its advisor force shrunk about 1% for the quarter (or by some 140 FAs) and declined roughly 5% for the full year (a drop of about 800 FAs).
Morgan Stanley has instituted a series of job cuts in the past few years, which included the firing of low-producing reps.
