Morgan Stanley · NYSE:MS

Morgan Stanley — Morgan Stanley 2019 U.S. Financials Conference

15 slides from Morgan Stanley's conference presentation, Jun 11, 2019

1. Slide 1: Morgan Stanley 2019 U.S. Financials Conference

   Morgan Stanley 2019 U.S. Financials Conference ​Andy Saperstein, Head of Wealth Management ​June 11, 2019

2. Slide 2: Notice

   Notice The information provided herein includes certain non-GAAP financial measures. The definition of such measures and/or the reconciliation of such measures to the comparable U.S. GAAP figures are included in this presentation, or in the Company’s Annual Report on Form 10-K, Definitive Proxy Stat

3. Slide 3: Key Themes Regarding Morgan Stanley Wealth Management

   Key Themes Regarding Morgan Stanley Wealth Management 1 Delivering Operating Leverage 2 Driving Growth While Enhancing Stability 3 Increasing Penetration in Core HNW Client Segment 4 Expanding Workplace Client Acquisition 5 Explaining Pre-Tax Margin(1) 1. Pre-Tax Margin represents income (loss) from

4. Slide 4: Delivering Consistent Growth and Improving Operating Leverage

   1 Delivering Consistent Growth and Improving Operating Leverage Solid Revenue Growth... ...With Expense Discipline... …Lead to Pre-Tax Expansion Revenues Non-Interest Expenses Pre-Tax Income(1) ($Bn) ($Bn) ($Bn) 17.2 4.5 12.9 12.7 11.2 1.8 31% 25% 2012 2018 2012(2) 2018 2012(2) 2018 Non-Compensation

5. Slide 5: Self-Funding Investments for Growth

   1 Self-Funding Investments for Growth Controlling Non-Compensation Expenses… …While Investing for Growth Non-Compensation Expenses ($Bn) Asset Aggregation Integration ​3.4 ​3.3 Goals Based Planning ​3.2 ​3.2 ​3.2 ​3.2 ​3.1 Risk Analytics Artificial Intelligence Virtual Advisor Digital Advice Platfor

6. Slide 6: Investments Contributing to an Increase in Financial Advisor Productivity

   1 Investments Contributing to an Increase in Financial Advisor Productivity Productivity Has …Through New Technology and Enhanced Client Solutions Increased… Revenue per Financial Advisor(1) ($Thousands) 1,100 Increase in Clients with a >100% Financial Plan(2) 780 Increase in Clients who Regularly >

7. Slide 7: Benefit from the Broader MS Platform and a One-Firm Culture

   1 Benefit from the Broader MS Platform and a One-Firm Culture Wealth Management Investment Management Institutional Securities 7

8. Slide 8: Generating Over 80% of Revenues from NII and Fee-Based Sources

   2 Generating Over 80% of Revenues from NII and Fee-Based Sources with Daily Revenues Consistently of $60MM+ Total Revenues Daily Revenues(3) ($Bn) ​17.2 2013 2015 2018 0.2 ​2.6 >$70MM 3% 2% 33% ​12.9 Other 0.3 ​4.3 $60MM - 16% 40% 58% Transactional(1) ​4.0 $70MM Net Interest ​1.6 84% $50MM - Income

9. Slide 9: Client Relationships Are Deep and Retention Is High

   2 Client Relationships Are Deep and Retention Is High Asset Retention Post Client Retention is Intergenerational Wealth Extraordinarily High Transfer is High 99% ~80% Same-Store Core Client Assets Retained at the Firm after Retention Rate(1) Intergenerational Wealth Transfer(2) 1. Same-store retenti

10. Slide 10: Financial Advisor Attrition Is Low and Declining

    2 Financial Advisor Attrition Is Low and Declining Financial Advisor Losses Are Declining and Retention of Assets Improving Total Financial Advisor Losses to Competition Losses and Retention Since 2017(3) (# of Financial Advisors) >$1MM Production(1) >50% Decline(3) Top Quintile Financial <1% Adviso

11. Slide 11: Our Core Business Is Focused on the High Net Worth Client Segment

    3 Our Core Business Is Focused on the High Net Worth Client Segment… MS Wealth Management Assets by Client Segment ($Bn) 2012 2018 %∆ >$10MM 538 990 84% ~3.2MM $1MM - Client Relationships 699 897 28% $10MM $100K - $1MM 414 384 (7%) ~$2.6Tn Asset Consolidation Opportunity(1) <$100K 45 32 (29%) 1. Sou

12. Slide 12: Our Core Client Segment Is Projected to Experience Outsized Growth

    3 …And Our Core Client Segment Is Projected to Experience Outsized Growth MS Wealth Management Total U.S. Investable Assets(1) Assets by Client Segment ($Bn) ($Tn) $ Change ​78 30 2012 2018 %∆ >$10MM 538 990 84% ​48 ​49 17 $1MM - 699 897 28% $10MM HNW+ (>50 y/o) ​32 $100K - 414 384 (7%) $1MM ​10 6 N

13. Slide 13: Solium Acquisition Creates a Leadership Position in Workplace

    4 …And Solium Acquisition Creates a Leadership Position in Workplace to Drive New Client Relationships MS Wealth Management Solium is Now Shareworks by Morgan Stanley, Assets by Client Segment a Key Pillar of “Morgan Stanley at Work” ($Bn) 2012 2018 %∆ >$10MM 538 990 84% Industry Leading Broad Retir

14. Slide 14: Explaining Pre-Tax Margin

    5 Explaining Pre-Tax Margin(1) Optimize For Initiated Integration Realize Scale Accelerate Growth Productivity Pre-Tax Margin(1) (%) 27% 26% 26% 22% 22% 20% 18% 14% 10% 9% 6% (2) 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 1Q19 Medium Term 1. Pre-Tax Margin represents income (loss) from contin

15. Slide 15: Morgan Stanley 2019 U.S. Financials Conference

    Morgan Stanley 2019 U.S. Financials Conference ​Andy Saperstein, Head of Wealth Management ​June 11, 2019

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