Morgan Stanley’s wealth management division has reported pre-tax profit from continuing operations of $973 million for the first quarter. This is a year on year increase of 23.8 percent. The pre-tax margin for the quarter was 24 percent.
Net revenues for the division reached $4.1 billion, a year on year increase of 10.8 percent.
Asset management fee revenues of $2.2 billion increased from $2.1 billion a year ago reflecting “market appreciation and positive flows,” the bank said in its results statement.
Transactional revenues totalled $823 million, up from $727 million a year ago, primarily due to “gains on investments associated with certain employee deferred compensation plans.”
Net interest income of $994 million increased from $831 million a year ago on loan growth and higher interest rates. Wealth management client liabilities were $74 billion, an increase of $8 billion year on year.
Compensation expense reached $2.3 billion, an increase from $2.1 billion a year ago. This was driven by higher revenues and an increase in “the fair value of deferred compensation plan referenced investments.” Non-compensation expenses of $768 million decreased from $794 million as a result of lower professional services costs.
Total client assets for the quarter were $2.2 trillion and client assets in fee-based accounts were $927 billion at quarter end. Fee-based asset flows for the quarter were $18.8 billion.
The 15,777 wealth management representatives produced average annualized revenue per representative of $1.0 million during the quarter.