REVENUES slumped in the second quarter, Morgan Stanley revealed yesterday, with falling market confidence hitting business levels hard.
But the bank reported a profit of $564m (£358.7m), compared with a loss of $558m in the same quarter of 2011 – when underlying figures were distorted by the conversion of a preferred stock investment made in support of the bank at the height of the financial crisis.
Revenues from ongoing operations plummeted 52 per cent on the year from $1.97bn to $940m.
Investment banking revenues fell 35 per cent on the year from $1.7bn to $1.1bn, while revenue from merger advisory fell 51 per cent to $263m.
Underwriting revenues dropped 34 per cent to $621m and equity trading revenue fell 34 per cent to $1.22bn, both on lower market volumes.
“Global economic uncertainty remains a headwind,” explained chief executive James Goreman.
However, the bank did succeed in cutting overall costs, joining the industry-wide trend of cutting back to bolster profits.
Total non-interest expenses fell 17 per cent from $7.24bn to $6.01bn, led by falling employment and pay.
Global headcount fell six per cent on the year from 62,577 to 58,627, while compensation and benefits dropped 21 per cent from $4.62bn to $3.63bn.
That takes expected compensation per employee down 16 per cent from $73,861 to $62,034.
Stocks slumped on the report, falling 5.65 per cent over the day to $13.25.