Morgan Stanley Reports Q4 Earnings Beat

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Tax overhaul charges have crimped fourth-quarter results for most big banks.

Morgan Stanley earnings fell to $686 million or 29 cents per share in the fourth quarter ended December 31, from $1.67 billion or 81 cents per share, last year.

Morgan Stanley's wealth management business continued to grow. Excluding the tax charges, the earnings rose to 84 cents a share, beating analysts' forecasts, from 74 cents.

Net income fell to $686 million or 29 cents per share in the fourth quarter ended December 31, from $1.67 billion or 81 cents per share, last year.

Shares of the sixth-largest USA bank rose 1 percent to $55.89 in morning trade. That division, which has been a top priority for the bank for years, reported a pre-tax profit of $1.2 billion compared with $891 million in the same period a year ago.

Investment banking revenue rose 12.4 percent to $1.55 billion, while wealth management rose 10.5 percent.

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Its longtime bet on the steady-as-she-goes business continues to bear fruit, assisted by a rising stock market that has lifted the value of client assets and respectively, the fees earned by the bank.

But analysts appeared disappointed by some of his new targets, repeatedly characterizing his latest wealth management goal as conservative and asking why he would not aim higher.

FILE PHOTO: The corporate logo of financial firm Morgan Stanley is pictured on the company's world headquarters in NY, U.S. April 17, 2017. These include the restructuring of its fixed-income arm (where revenue was wanting this quarter), a more generous shareholder payout plan and a stronger contribution from its crown jewel: wealth management.

JPMorgan took a 37 percent hit to quarterly profit due to a $2.4 billion charge related to the tax law, while Citigroup flagged a $19 billion write-down, and posted a $18-billion quarterly loss on Tuesday. Investors had attributed a higher value to Goldman for about a decade but a collapse in trading revenue previous year has hit the bank harder than its rival.

Excluding the tax charge, its return on equity was 9.4 percent previous year. Stock trading, where Morgan Stanley is strongest, had steady revenue from a year ago.

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