Morgan Stanley Q2 profit drops 18% as deal doldrums persist

MORGAN Stanley’s profit slipped 18 per cent in the second quarter as Wall Street’s deal-making drought stunted revenue from investment banking.

Profit applicable to common shareholders fell to US$2.05 billion, or US$1.24 per diluted share, for the three months ended Jun 30, the bank said on Tuesday (Jul 18). That is down from US$2.39 billion, or US$1.39 per diluted share, a year earlier.

Revenue from investment banking stood at US$1.16 billion, in line with last year. Global M&A activity fell 36 per cent in the second quarter versus a year earlier, Dealogic indicated. Still, its climb from the first quarter has sparked hopes of a nascent recovery.

Shares of the investment bank were up 1.4 per cent in premarket trading. REUTERS