Morgan Stanley hit by Tarp repayments

Steve Dinneen
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MORGAN Stanley yesterday posted net losses for the year of $907m (£557m).

Income from ongoing operations at the bank reached $1.15bn – up from a $246m loss in 2008 – but Tarp repayments and preferred share dividends to Mitsubishi pushed them back into the red.

Total losses applicable to Morgan Stanley shareholders were $907m, with losses of $0.93 cents a diluted share. This was up from a $731m loss in 2008 with losses of $1.26 per diluted share. The bank repaid around £1.2bn to the US treasury. Net revenues for the year were $23.4bn, compared with $18.2bn in 2008.

The bank posted profits in the fourth quarter but results were lower than many analysts had predicted.

Income from continuing operations was $413m, or $0.14 per diluted share. This was a sharp contrast to the huge losses of $10.5bn, or $10.92 per diluted share, a year earlier.

The bank announced a bumper bonus pool of $14.4bn yesterday – up from £11bn the year before. The amount is equivalent to 62 per cent of the bank’s $23.4bn revenue for the year, compared to a ratio of 60.7 per cent last year.

However, its tie-up with Smith Barney means the bonus will be shared between an extra 16,000 employees.

Morgan Stanley has been involved in a number of key deals this year, including advising Cadbury on the Kraft deal. It was overseen by Simon Robey (right) the firm’s global head of M&A. The bank’s London head is Walid Chammah.