Net revenues in Equities were $1.68 billion, 27% lower than the fourth quarter of 2012, due to the sale of the firm’s Americas reinsurance business  (10) in 2013 and the sale of the firm’s hedge fund administration business in 2012. Net revenues in equities client execution (excluding net revenues from the firm’s Americas reinsurance business) were significantly higher compared with the same prior year period, including significantly higher net revenues in cash products, partially offset by lower net revenues in derivatives. Commissions and fees were slightly higher compared with the fourth quarter of 2012. Securities services net revenues were significantly lower compared with the fourth quarter of 2012, due to a gain of $494 million on the sale of the firm’s hedge fund administration business in 2012. During the quarter, Equities operated in an environment generally characterized by an increase in global equity prices, while volatility levels remained low.

The net loss attributable to the impact of changes in the firm's own credit spreads on borrowings for which the fair value option was elected was $206 million ($163 million and $43 million related to Fixed Income, Currency and Commodities Client Execution and equities client execution, respectively) for the fourth quarter of 2013, compared with a net loss of $126 million ($79 million and $47 million related to Fixed Income, Currency and Commodities Client Execution and equities client execution, respectively) for the fourth quarter of 2012.

Investing & Lending

Full YearNet revenues in Investing & Lending were $7.02 billion for 2013, 19% higher than 2012. Results for 2013 included net gains of $3.93 billion from investments in equities, primarily in private equities, driven by company-specific events and strong corporate performance. In addition, Investing & Lending net revenues included net gains and net interest income of $1.95 billion from debt securities and loans, and other net revenues of $1.14 billion related to the firm’s consolidated investments.

Fourth QuarterNet revenues in Investing & Lending were $2.06 billion for the fourth quarter of 2013, 4% higher than the fourth quarter of 2012 and 40% higher than the third quarter of 2013. Results for the fourth quarter of 2013 included net gains of $1.40 billion from investments in equities, primarily reflecting company-specific events, including initial public offerings, and net gains in public equities. In addition, Investing & Lending net revenues included net gains and net interest income of $423 million from debt securities and loans, and other net revenues of $234 million related to the firm’s consolidated investments.

Investment Management

Full YearNet revenues in Investment Management were $5.46 billion for 2013, 5% higher than 2012, reflecting higher management and other fees, primarily due to higher average assets under supervision. During the year, total assets under supervision  (3) increased $77 billion to $1.04 trillion. Long-term assets under supervision  (3) increased $81 billion, including net inflows of $41 billion  (4), reflecting inflows in fixed income and equity assets, partially offset by outflows in alternative investment assets. Net market appreciation of $40 billion during the year was primarily in equity assets. Liquidity products  (3) decreased $4 billion.

Fourth QuarterNet revenues in Investment Management were $1.60 billion for the fourth quarter of 2013, 5% higher than the fourth quarter of 2012 and 31% higher than the third quarter of 2013. The increase in net revenues compared with the fourth quarter of 2012 reflected higher management and other fees, primarily due to higher average assets under supervision. During the quarter, total assets under supervision  (3) increased $51 billion to $1.04 trillion. Long-term assets under supervision  (3) increased $33 billion, including net inflows of $13 billion, reflecting inflows in fixed income and equity assets, partially offset by outflows in alternative investment assets. Net market appreciation of $20 billion during the quarter was primarily in equity assets. In addition, liquidity products  (3) increased $18 billion.

Expenses

Operating expenses were $22.47 billion for 2013, 2% lower than 2012.

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