Wall Street revival, Morgan Stanley hits a new high, CEO asserts: Competitors will find it hard to catch up with the big banks
Top US bank stocks saw a strong rebound in Q3 earnings season, with Morgan Stanley's Ted Pick stating that smaller banks are finding it difficult to catch up with large banks due to high operating costs
Top U.S. bank stocks shine in Q3 earnings reports, with Morgan Stanley CEO stating that the gap between large and small banks is widening.
This quarter, JPMorgan Chase, Bank of America, Goldman Sachs, and Citigroup have all presented outstanding "report cards," indicating a significant recovery in the U.S. banking industry.
Morgan Stanley's Q3 performance is also impressive. According to the financial report, Morgan Stanley's net revenue in the third quarter increased by 16% year-on-year to $15.38 billion, and net profit in the third quarter surged by 33% year-on-year to $4.221 billion.
This is mainly due to the strong performance of its wealth management and investment banking businesses. Morgan Stanley CEO Ted Pick stated in a release that the stock market rally and net fund inflows provided support for the assets of the wealth management and investment management departments, with the total assets under management of the two departments reaching approximately $7.5 trillion.
Financial data shows that the revenue of Morgan Stanley's wealth management department in the third quarter hit a record high, accounting for about half of the total revenue; the institutional securities department (where investment banking and trading businesses are located) saw a significant revenue increase of 20% to $6.815 billion, with investment banking revenue surging by 56% year-on-year, mainly driven by the increase in fixed income underwriting business.
Morgan Stanley CEO Ted Pick also mentioned in a media interview on Wednesday:
"Another factor is that it is now difficult for competitors to catch up with large banks, as the cost of operating these businesses is very high each year."
Following the release of the financial report, Morgan Stanley's stock price surged by 8.2%, marking the largest intraday gain in nearly four years.
Year-to-date, Morgan Stanley's stock price has risen by over 27%, with a market value of $193.3 billion.
