Unlike every other major bank, Morgan Stanley didn’t find a way to report an accounting profit. The company posted a net loss of $177 million or $.57 per share and net revenue of about $3 billion.
Remember how Citigroup (C) reported a gain because its bonds weakened?
Well Morgan Stanley’s situation was the opposite. It’s revenue fell $1.5 billion due to tightening credit spreads — in other words, as its bonds rose in value, it had to mark up its liabilities
CEO John Mack called it “… a significant positive development, [which] had a near-term negative impact on our revenues.”
The company made no mention of repaying TARP, though Mack has said in the past that the firm isn’t ready to do so yet.
The company also said that it’s slashing its dividend to $.05 and shares are off about 8% pre-market.
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