Morgan Stanley Beats Q3 Earnings Forecast on Stronger Trading and Wealth Management Revenues

Morgan Stanley's third quarter earnings echoed larger rivals Thursday with a big jump in trading revenues and smaller-than-forecast credit loss provisions.

Morgan Stanley  (MS) - Get Morgan Stanley (MS) Report posted stronger-than-expected third quarter earnings Thursday thanks in part to a surge in trading and wealth management revenues and lower provisions for bad loans. 

Morgan Stanley said diluted profits for the three months ending in September were pegged at $1.66 per share, up 30.7% from the same period last year and well ahead of the Street consensus forecast of $1.28 per share. Group revenues, the bank said, rose 17% to $11.7 billion thanks in part to a solid performance in the bank's core wealth management business.

Wealth management revenues rose 6.8% to $4.7 billion, Morgan Stanley said, while institutional securities revenues rose 22% to $6.1 billion. Credit provisions also inched slipped lower from the previous quarter, falling 53.5% to $111 million.

 “We delivered strong quarterly earnings as markets remained active through the summer months, and our balanced business model continued to deliver consistent, high returns," said CEO James Gorman. "The completion of the E*TRADE acquisition, the subsequent ratings upgrade from Moody’s, and the recently announced acquisition of Eaton Vance significantly strengthen our Firm and position us well for future growth.”  

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Morgan Stanley shares were marked 0.75% higher in early trading following the earnings release to change hands at $51.00 each, a move that puts its six-month gain at around 32%.

JPMorgan  (JPM) - Get JPMorgan Chase & Co. (JPM) Report and Citigroup  (C) - Get Citigroup Inc. Report both posted Street-beating earnings on Tuesday, with the pair also booking loan loss provision figures that were much lower than analysts had expected.

JPMorgan's total was just $611 million, while Citigroup's was pegged at $2.3 billion, well south of the $7.9 billion booked in the previous quarter. Goldman Sach's  (GS) - Get Goldman Sachs Group, Inc. (GS) Report third quarter credit provisions were $278 million, down from $1.59 billion in the three months ending in June, while investment banking revenue was $1.97 billion, a 7% increase from the same period last year.