Morgan Stanley reports sharp quarterly, annual lossesDecember 18th, 2008 - 5:27 am ICT by IANS
New York, Dec 18 (DPA) Investment bank Morgan Stanley Wednesday reported sharp fourth-quarter losses and reductions in year-on-year income for the business year that ended Nov 30, continuing the fallout from the economic crisis.The company reported that its income for the year came to $1.8 billion, compared with $2.6 billion the previous year.
In the final quarter, the company reported a loss of $2.2 billion, compared with a $3.6 billion loss for the fourth quarter in 2007.
The company reported net income for the year of $1.7 billion, compared to $3.2 billion a year ago.
It emphasised that it had enjoyed a successful first three quarters to the year, but that overall revenues had been dragged down by a dismal fourth quarter.
“The environment will continue to be challenging. But we have successfully evolved and adapted our business across numerous cycles, and the current market dislocation gives us openings … to build market share, seize new opportunities and ultimately deliver long-term value to our shareholders,” said chairman and CEO John J. Mack.
Morgan Stanley is one of the two major investment banks to have survived Wall Street’s September meltdown as an independent company. However, the financial crisis forced it to reinvent itself as a bank holding company.
The company also reported that senior executives like Mack would forgo a bonus in 2008 while many other executives would see any bonuses pared back.
It also announced a plan to allow the company to reclaim bonuses from employees who are discovered to have caused problems that result in significant financial loss or restatement of results.
Starting in 2009, the company will switch to a business year that runs from Jan 1 to Dec 31. There will be a special report on business activities for December 2008 released with next year’s report on first quarter activities.
Goldman Sachs, the other investment bank survivor, reported Tuesday its first quarter-on-quarter loss since it began trading shares 10 years ago.