Morgan Stanley has reported net income applicable to the firm of $5.5bn for the first quarter of 2026, up 29% from $4.3bn in the same period last year.
Net revenue for the quarter increased by 16% to $20.58bn from a year-ago level.
The bank reported a return on tangible common equity of 27.1%, while its expense efficiency ratio stood at 65% in the first quarter.
Its wealth management arm generated $8.5bn in revenue, against $7.3bn a year earlier.
The increase was linked to asset management income, client activity and net interest income.
During the quarter, the unit recorded $118bn in net new assets and $54bn in fee-based asset flows.
Total client assets in wealth management were $7.35tn as of 31 March 2026, up 22% year over year.
Revenue in investment management came to $1.5bn, versus $1.6bn a year earlier.
The result was mainly attributed to asset management fees on higher average assets under management. Long-term net flows were positive at $3.3bn in the quarter.
In the investment management arm, total assets under management or supervision were $1.87tn, up 13% year over year as of 31 March 2026.
Institutional securities posted revenue of $10.7bn, up from $9bn in the same quarter last year. The change reflected results in markets operations amid higher market volatility and gains in investment banking, led by advisory work.
The provision for credit losses was affected by individual assessments tied to certain commercial real estate loans, as well as greater macroeconomic uncertainty.
Compensation costs increased from a year earlier, mainly due to higher revenue and stock-based compensation expense linked to awards granted in previous periods.
During the quarter, Morgan Stanley bought back $1.75bn of its common stock under its share repurchase programme.
The board also declared a quarterly dividend of $1 per share, payable on 15 May 2026 to common shareholders on record as of 30 April 2026.
Morgan Stanley chairman and CEO Ted Pick said: “Morgan Stanley reported a record quarter. Strong execution resulted in net revenues of $20.6 billion, EPS of $3.43 and a ROTCE of 27.1%. Institutional Securities benefited from robust client engagement and strength globally.
“Wealth Management demonstrated continued momentum, with net new assets of $118 billion and fee-based asset flows of $54 billion. These results affirm the capabilities of our Integrated Firm as we deliver a higher plane of operating performance.”
Last month, the Wall Street Journal reported, citing sources, that Morgan Stanley is preparing to eliminate about 2,500 roles, equal to around 3% of its global workforce.
The reported job cuts are expected to affect investment banking and trading, wealth management, and investment management.
