Morgan Stanley Posts Upbeat Q2 Results On Strong Trading Revenues

Morgan Stanley (MS) reported better-than-expected Q2 results, bolstered by strong trading revenues, amid the COVID-19 pandemic.

The banking and brokerage services company’s Q2 net income applicable was $3.2 billion or $1.96 per share, compared to $2.2 billion or $1.23 per share last year.

Adjusted earnings for the quarter increased to $2.04 per share from the previous year’s $1.23 per share. Analysts polled by Thomson Reuters expected earnings of $1.12 per share for the quarter. Analysts’ estimate typically exclude certain special items.

Net revenues increased to $13.4 billion from $10.2 billion generated a year ago, and surpassed Wall Street analysts’ revenue estimate of $10.31 billion for the quarter.

The bank’s Institutional Securities unit recorded net revenue growth of 56%, reflecting outperformance across the businesses; while equity sales and trading net revenues surged 68% on strong performance in cash equities and derivatives across all regions driven by elevated client activity.

Provision for credit losses on loans and lending commitments totaled $239 million for the quarter, down from the previous quarter’s $407 million.

James Gorman, Chairman and Chief Executive Officer, said, “The second quarter tested the model and we performed exceedingly well, delivering record results. This builds on the momentum of a very strong first quarter, while more than 90% of our employees continue to work from home, demonstrating the ongoing operational resilience of our platform…”

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