Morgan Stanley · NYSE:MS
Morgan Stanley — Q3 2010 Earnings Presentation
13 slides from Morgan Stanley's earnings presentation, Nov 17, 2010
Slide 1: Morgan Stanley Third Quarter 2010 Overview
Free Writing Prospectus Dated November 17, 2010 Registration Statement No. 333-156423 Filed Pursuant to Rule 433 Morgan Stanley Third Quarter 2010 Overview November 2010
Slide 2: Notice
Notice The information provided herein may include certain non-GAAP financial measures. The reconciliation of such measures to the comparable GAAP figures are included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2009, 2010 Quarterly Reports on Form 10-Q and Current Re
Slide 3: Index
Index • Consolidated Financial Highlights • Business Strategy and Financial Results − Institutional Securities − Global Wealth Management Group − Asset Management • Capital • Funding Diversification − Secured Funding − Unsecured Funding • Summary
Slide 4: Consolidated Financial Highlights
Consolidated Financial Highlights (1) 3Q10 Net Revenues of $6.8 Bn 3Q 2010 Highlights - Business Mix 3Q10 • Third quarter revenues were $6.8 billion Asset − Includes negative impact of $731 million from Management tightening of debt-related credit spreads (3) Equities • Results reflect: 12% Global −
Slide 5: Executing Our Business Strategy
Executing Our Business Strategy Long Term Performance Goals Institutional Securities Strengthen Institutional Securities • Strong talent pool Leading position in many businesses, with upside • Increase footprint from more broadly leveraging our client franchise • Expand market share Wealth Managemen
Slide 6: Institutional Securities
Institutional Securities Net Revenue ($mm) 5,018 3Q 2010 Highlights - 785 4,505 885 • Net Revenues of $2.9 billion 1,038 − Includes negative impact of approximately $731 2,894 1,415 115 million from tightening of debt-related credit 1,186 1,008 spreads (2) 925 • For the first nine months of 2010, In
Slide 7: Global Wealth Management Group
Global Wealth Management Group Net Revenue ($mm) 3,104 3Q 2010 Highlights - 3,029 3,074 • Stable revenues of $3.1 billion 168 288 302 • 281 million PBT and 9% PBT margin 356 249 391 222 273 318 709 692 564 − Quarterly integration costs of approximately $83 million 1,574 1,572 1,529 • 18,119 Financia
Slide 8: Asset Management
Asset Management Net Revenue ($mm) 3Q 2010 Highlights - 802 • Net Revenues of $802 million 447 410 393 • Core Asset Management - $380 million 22 • 21 6 Merchant Banking - $422 million 429 415 − includes $203 million of gains from 383 consolidated Morgan Stanley Real (4) (6) Estate Funds 3Q 2009 2Q 2
Slide 9: Balance Sheet and Capital
Balance Sheet and Capital Total Assets 3Q10 Key Capital Ratios (Basel I) ($Bn) 943 820 809 841 770 771 677 677 626 Tier 1 Common Ratio 10.7% Tier 1 Capital Ratio 16.5% 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 2008 2008 2009 2009 2009 2009 2010 2010 2010 Source: Morgan Stanley Earnings Conference Call, SEC Filings
Slide 10: Funding Diversification
Funding Diversification Composition of Funding Liabilities and Equity Shareholders’ Equity Shareholders’ Deposits Equity 5% 5% 11% Long-term Debt Long-term Debt 32% Deposits 37% 12% 52% 6% 39% 1% Commercial Paper Commercial Paper & other short term Secured & other short term borrowings Funding borro
Slide 11: Secured Funding Term Consistent with Asset Fundability
Secured Funding Term Consistent with Asset Fundability Focus on Liquidity Characteristics of Assets • Assets Tiered by Fundability: Less Liquid Illiquid − Highly Liquid – Governments, Agencies, Open Market Operations and Central Clearing Counterparty eligible collateral − Liquid - AAA or AA bonds, S
Slide 12: Estimated Senior Unsecured Funding Issuance
Estimated Senior Unsecured Funding Issuance As of 9/30/10 • Reduction in term funding ($Bn) planned for 2011 and 2012 given success in 40 38 − Pre-funding 35 ~31 − Structured Notes Issuance 13 ~ 28 30 ~3 27 − Term Secured Funding 25 ~ 23 21 11 8 • Assumes a constant 20 3 8-10 16-18 balance sheet thr
Slide 13: Well Positioned for Strong Execution Going Forward
Well Positioned for Strong Execution Going Forward Opportunity to Increase Share Significant Market Share Opportunities Targeted Growth Strategy • Clients receptive to Morgan Stanley offerings • Expanding capability to deliver flow products and content / ideas across the firm Experienced Leadership