Updated from 8:44 a.m. EDT

Morgan Stanley ( MWD) kept the streak of good earnings reports alive on Wall Street firms Wednesday, reporting higher third-quarter profits before a previously announced charge in its airline-leasing business.

In the quarter, the big Wall Street investment bank earned $144 million, or 13 cents a share, compared to $837 million, or 76 cents a share. Earnings were depressed by the $1 billion after-tax charge stemming from Morgan Stanley's decision last month to exit the trouble aircraft-leasing business.

The charge marred an otherwise solid quarter for Morgan Stanley, which posted a 29% gain in revenue to $6.9 billion. Even without the charge, however, the quarter was not as good as some of Morgan Stanley's peers.

In early afternoon trading, shares of Morgan Stanley were off 46 cents to $51.94.

Excluding the item, Morgan Stanley earned $1.17 billion in the quarter, or $1.09 a share. On that basis, the firm exceeded the Thomson Financial consensus estimate of $1.05 a share. Morgan Stanley also surpassed the analyst revenue estimate of $6.26 billion.

The quarterly results are the first from Morgan Stanley since John Mack became chairman and CEO, following the tumultuous departure of Phil Purcell. The decision to exit the aircraft leasing business, something that has been a drag on earnings for several quarters, was one of Mack's first big moves since taking over the helm of the firm.

The big earnings driver at Morgan Stanley in the quarter was its institutional securities division, which includes the firm's investment bank. Net revenue from the division rose 51% to $4.16 billion. Pacing the advance was the firm's trading desk, which generated $2 billion in revenue, up 63% from a year ago.

But traditional lines of investment banking also performed well. Revenue from corporate advisory work rose 25% to $388 million. Underwriting fees rose 27% to $510 million, mostly from underwriting bond deals. Fees from stock offerings were flat, despite an industrywide surge in initial public offerings in the quarter.

Revenue in the retail brokerage group rose 12% to $1.26 billion. Soon after Mack took over, he announced massive job cuts in the brokerage division, as the firm aims to go after wealthier clients and increase the group's profitability.

The Discover credit card business, a division Morgan Stanley had considered spinning off earlier this year, posted a modest 3% gain in revenue to $911 million.

In a conference call with analyst, Morgan Stanley Chief Financial Officer David Sidwell said the Discover business has had to deal with a rising number of personal bankruptcy filings, as consumers seek to beat a deadline under the new bankruptcy law. The rise in bankruptcies has led to a larger number of charge-offs and diminished short-term earnings at Discover.

Separately, Morgan Stanley announced that it had reached a deal with Metris ( MXT) to market a version of the Discover card to its customers. Earlier this summer, British-based HSBC ( HBC) announced plans to buy Metris.

Sidwell also said it intends to speed up a previously announced share buyback program. He said the firm intends to buyback up to 46 million shares by the end of the fiscal year, which ends in November. To date, Morgan Stanley has purchased about 40 million shares.

Morgan Stanley is the last of the big four Wall Street firm, whose quarters ended Aug. 31, to report earnings. Of the four, Goldman Sachs ( GS) and Lehman Brothers ( LEH) were the top performers, followed by Bear Stearns ( MWD) and then Morgan Stanley.