Second-quarter profits at
nearly doubled from a year ago, fueled by a strong rebound in the Wall Street firm's institutional securities division.
The securities firm earned $1.8 billion, or $1.10 a share, in the quarter compared with $915 million, or 55 cents a share, a year ago. The Thomson First Call consensus estimate had Morgan Stanley earning $1.06 a share.
Total net revenues at Morgan Stanley came in at $6.65 billion, well ahead of the $6 billion estimate of most analysts.
Net revenues in the firm's institutional securities group rose 47% from a year ago to $3.94 billion. The group includes Morgan Stanley's investment bank and fixed-income trading group.
Morgan Stanley is one of two big Wall Street firms slated to report earnings on Tuesday.
also easily beat estimates.
Last week both
posted better-than-expected earnings, as Wall Street firms have yet to show any ill effects from the rise in long-term interest rates -- something that many had expected would take a bite out of bond trading revenue.
Earnings at Morgan Stanley would have been even higher if not for a $109 million pretax impairment charge on its aircraft leasing business. The charge reduced earnings by 6 cents.
On a percentage basis, investment banking posted the strongest gains at Morgan Stanley. In the quarter, net income from investment banking rose 83% to $983 million. Earnings from proprietary trading also remained strong, coming in at $2 billion, up 24% from a year ago.
The weak link in Morgan Stanley's franchise was its Discover credit card business. The group generated $298 million in earnings, down 1% from a year ago. Net revenue in the credit card services division also declined 1% to $879 million.