Morgan Stanley-Better-than-expected results, notably thanks to M&A

April 14 (Reuters) – Morgan Stanley on Thursday reported a smaller-than-expected 11% drop in first-quarter profit as a near doubling of fees from mergers and acquisitions (M&A) activity helped cushion the fall in market activities.

The investment bank overtook rival Goldman Sachs in M&A, as Russia’s invasion of Ukraine weighed on market activity, notably due to the postponement of IPOs.

The U.S. bank’s profit fell to $3.54 billion (3.25 billion euros), or $2.02 per share, in the quarter ended March 31, from $3.98 billion, or 2.19 dollars per share, a year earlier. Analysts on average had expected earnings limited to $1.68 per share, according to Refinitiv data.

According to Refinitiv, equity subscription volumes fell 80% in the first quarter for Morgan Stanley and Goldman Sachs, the two largest IPO banks in the world.

In contrast, Morgan Stanley nearly doubled its advisory revenue, thanks to increased M&A deals. (Report by Noor Zainab Hussain in Bengaluru; French version Dina Kartit, edited by Jean-Michel Bélot)