Morgan Stanley just posed its worst bond trading results in 3 years

james gormanJames Gorman, Morgan Stanley CEOAP Photo

  • Morgan Stanley said net income rose to $1.5 billion from the prior year, but that missed analysts' $1.6 billion estimate.
  • The Wall Street bank said fixed-income trading revenue had fallen 30% to $564 million, the worst performance for that unit in three years.

Morgan Stanley announced fourth-quarter results Thursday morning that missed analyst estimates. The bank posted earnings of 80 cents a share, lower than the 89 cents expected by analysts.

Here are the key numbers:

  • Revenue: $8.5 billion, a 10% decline from last year and a miss to Wall Street's prediction of $9.4 billion.
  • Adjusted net income: $1.5 billion, up 138% from the prior year when a change to the tax code battered earnings. Analysts had predicted $1.6 billion.
  • Institutional securities: $3.8 billion, down 15% from the prior year. Fixed income trading slumped 30% to $564 million. KBW analysts had predicted $4.1 billion for the division, and $646 million for fixed-income trading.
  • Wealth management: $4.1 billion, down 6% from the prior year. KBW analysts thought the bank's biggest division may bring in $4.3 billion in revenue.
  • Investment management: Revenue of $684 million, up 7%. KBW analysts predicted $676 million.
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