NEW YORK: Morgan Stanley announced net revenues of $7.8 billion for the fourth quarter ended December 31, 2014 versus $7.8 billion a year ago.
Income from continuing operations applicable to Morgan Stanley for the current quarter was $1.0 billion, or $0.47 per diluted share, 10 compared with income of $95 million, or $0.02 per diluted share, for the same period a year ago. Results for the current quarter included several significant items: a net discrete tax benefit of approximately $1.4 billion or $0.70 per diluted share principally related to the restructuring of a legal entity;1,2 compensation expense adjustments of approximately $1.1 billion or a loss of $0.40 per diluted share related to changes in discretionary incentive compensation deferrals;2,3 a charge of $468 million or a loss of $0.17 per diluted share related to the initial incorporation of funding valuation adjustments (FVA) into the fair value measurements for certain over-the-counter derivatives and legal expenses of $284 million or a loss of $0.12 per diluted share associated with several residential mortgage and credit crisis related matters.2,4
For the current quarter, net income applicable to Morgan Stanley, including discontinued operations, was $1.0 billion or $0.47 per diluted share,10 compared with net income of $84 million or $0.02 per diluted share in the fourth quarter of 2013. Wealth Management reported pre-tax income from continuing operations of $736 million compared with $715 million in the fourth quarter of last year. The quarter’s pre-tax margin was 19%, which included the impact of compensation expense deferral adjustments.3,12 Net revenues for the current quarter were $3.8 billion compared with $3.7 billion a year ago.
