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Investment Banking Morgan Stanley

Morgan Stanley Team Paper Analysis Investment Banking December 15, 2009 By Table of Contents 1. Introduction 2. Company overview 3. History and Development of the company’s business development 4. Recent Business Developments 5. Mission and vision statement 5. 1 Mission statement 5. 2 Vision 6. Core business and services offered 7. Market analysis 1. Target market 2. Competitors 8. Financial analysis 8. 1 Highlights – First Half 2009 8. 2 Overview of financial situation 9. SWOT analysis. 9. 1. Strength and weakness analysis (internal factors) 9. 2.

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Opportunities and threats analysis (External forces) 10. Global Issues 11. Company’s strategy 12. Regulations 13. Conclusion and recommendation References 1. Introduction Most leading economists have called the global financial crisis that started in the middle of 2007 with a collapse the US sub-prime mortgage market and the reversal of the housing boom in industrialized economies, “the worst financial meltdown since the great depression of 1921”. The falling of stock market and the collapse of large financial institutions has made other weaknesses in the global financial system to surface.

The reaction of governments worldwide did not wait. Varieties of approaches to rescue the financial sector, in which people have lost confidence, were adopted. In US, the government believed that solutions to the crisis reside in American Recovery and Reinvestment Act of 2009 (Kennard 2009), and Emergency Economic Stabilization Act of 2008 (Nygard & Al 2009) that in the bailout of “too big to fail and too broad and complicated to survive without significant help from the government” (the new book by Deal Book Andrew Ross Sorkin) companies, such as AIG, Bank of America, and Citigroup.

The government also believed that a creation of a more regulated financial system would prevent such a crisis in the future. Nevertheless, bailed out or not, 2009 has become a year for financial companies that have survived the economic tumult of the last several months, to reiterate their presence and to emphasize their stability and their value to current and potential clients (Braverman, 2009). Morgan Stanley survived without government assistance thanks to a resistance to the tendency to respond emotionally to the crisis by making poor financial decisions.

It is the reason why, when asked by CNBC, Dennis Gartman, founder of the Gartman Letter told the CNBC that the Morgan Stanley will not disappear, and will be viable businesses. The restructure of the company and the decision to become traditional bank holding companies regulated by the Federal Reserve (Dolbeck, Andrew, Sep 2008), rang the bell of another era in of the financial system. 2. Company overview

Morgan Stanley is a global financial services firm that provides its products and services to a large and diversified group of clients and customers, including corporations, governments, financial institutions and individuals, through its subsidiaries and affiliates, financial institutions and individuals. Originally incorporated under the laws of the State of Delaware in 1981 (MS report 2008). The company operates in three primary business segments: institutional securities, global wealth management group and asset management. MS conducts its business from its headquarters in New York City, its regional offices and branches throughout the U.

S. , and its principal offices in London, Tokyo, Hong Kong and other world financial centers. November 30, 2008, Morgan Stanley had 46,964 employees worldwide (MS, report 2008). 3. History and Development of the company’s business development A brief review of Morgan Stanley’s history shows its strong market presence in investment banking and other business field such as real estate. The company was founded in 1935 to continue the investment banking business of J. P. Morgan & Co, following the Glass-Steagall Act (Ruffle, John F. , 1989) which separated commercial banking from the investment-banking business.

Henry Morgan, Harold Stanley, and others left JP Morgan & Co. and Drexel & Co. form investment banking firm MS. In its first full year, the company achieved 24% market share of public stock offerings. In 1938, the firm was involved with the distribution of US$100 million of debentures for the United States Steel Corporation as the lead underwriter. The growth of the company led the management to major reorganization in 1941 to allow for more activity in its securities business and joined the New York Stock Exchange and entered the brokerage business (MS, report 2008).

The period 1951–1961 was intense and MS was involved in the management of the famous World Bank’s US$50 million triple-A-rated bonds offering of 1952. It also dealt with the General Motor’s US$300 million debt issue, US$231 million IBM stock offering, and the US$250 million AT&T’s debt offering (MS, report 2008). The expansion strategy took place in the 1967 in Paris division and led to creation in 1964, of the first computer model for performing financial analysis. In 1970 MS formally entered the Japanese markets. In 1975 the company established MS International Inc. n London. Recognizing its expansion potential, MS will adopt a diversification strategy and in 1967 and establish a real estate financing and created a Mergers and Acquisitions division in 1971. Through a series of Merger and Acquisitions the company believed to foster growth in size and to diversify in products and in 1967 acquired Brooks, Harvey & Co. , Inc. Van Kampen American Capital (1996), the Canary Wharf Group (2004) and AB Asesores of Spain (1999). It also merged with Dean Witter, Discover & Co. in 1997 to form a dominant force in securities and asset management.

Morgan Stanley led the Apple common stock IPO on December 12, 1980. The period of 2000 until present is rich in activities and transactions for the company. The most important are the co-management of the Google IPO (2004), Discover Card unit, the reception of US$5 billion capital infusion from the China Investment Corporation. In order to cope up with the write-downs, during the Subprime mortgage crisis to advise the government on potential rescue strategies for Fannie Mae and Freddie Mac. The decade is also marked by the financial crises of 2007-2009 when the firm’s share price slide for about 42%.

On September 22, 2008, Morgan Stanley became traditional bank holding companies regulated by the Federal Reserve. 4. Recent Business Developments The press release of June 1, 2009 reported that Morgan Stanley Smith Barney is a new industry-leading franchise with over 18,500 Financial Advisors. Morgan Stanley and Citigroup Inc. (“Citi”) in January 2009 announced the combination of the world’s top Wealth Management Brands that offers client global platform, intellectual capital and research resources. In the agreement, Morgan Stanley spent $2. 75 billion for a 51% stake and can buy the remainder over the next five years.

Citigroup will own 49%. Morgan Stanley appointed four directors to the joint venture’s board and Citi will appoint two directors as show on the organizational chart. After year three, Morgan Stanley and Citi will have various purchase and sales rights for the joint venture. Under the name of Morgan Stanley Smith Barney, the company is operating under the leadership of James P. Gorman after the resignation of John Mark. As the company became a bank holding company, it is also being restructured to consolidate the marketing and creative function, and international division.

Thus the performance to date has established the management infrastructure as shown by the organizational chart. 5. Mission and vision Statement 5. 1 Mission statement “Our goal is to be the world’s best investment bank and the firm of choice for our clients, our people, and our shareholders. We will succeed by meeting the global needs of our clients – both providers and users of capital – at a level of performance which is exceptional. This commitment to add maximum value will be characterized by extraordinary effort and innovation, and by conducting ourselves with absolute integrity.

Morgan Stanley’s people are the source of our competitive advantage. We will distinguish ourselves by creating an environment that fosters teamwork and innovation, by developing and utilizing our employees’ abilities to the fullest, and by treating”. 5. 2 Vision Organizational Chart: Morgan Stanley Smith Barney |MSSB Board of Directors | |(4 from MS, 2 from Citigroup, and President of JV) | James Gorman | |Chairman | MS Source: Barclays Financial Services Conference 6. Core business and services offered Morgan Stanley is a global financial services firm that maintains significant market positions in each of its business segments—Institutional Securities, Global Wealth Management Group and Asset Management.

Institutional Securities services includes operations, such as capital raising, financial advisory services (including advice on mergers and acquisitions, restructurings, real estate and project finance), corporate lending, sales, trading, financing and market-making activities in equity and fixed income securities and related products (including foreign exchange and commodities), benchmark indices and risk management analytics, and investment activities. Intuitional securities contributed to the company’s net income about $ 2. 201 billion in 2008, $ 940million in 2007 and $ 5. 469billion in 2006.

Global Wealth Management Group provides brokerage and investment advisory services covering various investment alternatives: financial and wealth planning services, annuity and other insurance products, credit and other lending products, cash management services, retirement services, and trust and fiduciary services. Asset Management provides global asset management products and services in equity, fixed income, alternative investments, which includes hedge funds, and merchant banking, which includes real estate, private equity and infrastructure to institutional and retail clients through proprietary and third-party distribution channels. .

Market analysis 7. 1 Target Market Morgan Stanley’s financial products and services are very competitive. The company actually competes on domestic and global market. It serves a diversified group of corporations, governments, financial institutions, and individuals and operates in 33 countries around the world with 600 offices, and over 46000 employees. There following table show the company’s revenue and assets per geographic area. It is clear that the company gain most of its revenue from American market: 54% in 2008, 43% in 2007, and 62% in 2006 Net Revenue(in Millions) |Fiscal 2008 |Fiscal 2007 |Fiscal 2006 | |America |13,317 |12,026 |18,577 | |Europe, Middle East, and Africa |8,971 |10,085 |7,948 | |Asia |2,451 |5,868 |3,274 | |Total Revenue |27,739 |27,979 |29,799 | |Asset (in Millions) | | | | |America |461,596 |692,328 |690,498 | |Europe, Middle East, and Africa |143,683 |269,753 |347,379 | |Asia |53,533 |83,328 |83,315 | |Total Revenue |658,812 |1,045,409 |1,121,192 |

Source: Morgan Stanley financial report 2008 7. 2. Competitors MS competitors are primarily in the Investment Banking industry, Asset Management, Lending, and Securities Brokers & Traders sectors. Competitions also come from commercial banks, brokerage firms, insurance companies, and sponsors of mutual funds, hedge funds, energy companies, and other companies offering financial services in U. S. globally, and through the internet. Below is specification of major competitors. Citigroup Citigroup Global Markets provides investment banking services to corporate, institutional, government, and retail clients. It divides its business into four geographic regions: North America, Europe/Middle East/Africa, Asia, and Latin America.

The group operates in Japan through Nikko Citi, Citigroup’s joint venture with brokerage Nikko Cordial Corporation. As part of a major restructuring by Citigroup, Global Markets, along with its parent company’s retail and private banking units, will be split from Citigroup’s consumer finance business in a new company to be called Citicorp. company’s website) Financial Situation for Citigroup Global market (In $ billions) | |2005 |2006 |2007 |2008 | |Total Revenue |120. 0 |147. 0 |159. 0 |106. 0 | |Operating Profit |70. 8 |86. 6 |78. 9 |4. 67 | |Financial Assets |1,450. 0 |1,840. 0 |2,120. 0 |1,890. 0 | |Non-Financial Assets |47. 9 |49. |63. 9 |46. 9 | |Long Term Debt |217. 0 |288. 0 |427. 0 |360. 0 | |Shareholder Equity |113. 0 |120. 0 |114. 0 |142. 0 | Goldman Sachs Goldman Sachs is a leader in the investment banking world. A global leader in mergers and acquisitions advice and securities underwriting, Goldman offers a variety of investment banking and asset management services to corporate and government clients, as well as institutional and individual investors.

It owns Goldman Sachs Execution & Clearing, one of the largest market makers on the NYSE and a leading market maker for fixed income products, currencies, and commodities. In 2008 Goldman Sachs converted to a bank holding company and formed subsidiary Goldman Sachs Bank USA (GS Bank USA), now in charge of bank loan trading, mortgage originations, and other activities Financial Situation for Goldman Sachs (In $ billions) | |2005 |2006 |2007 |2008 | |Total Revenue |43. 4 |69. 4 |88. 0 |53. 6 | |Operating Profit |26. 4 |46. |66. 9 |35. 3 | |Financial Assets |707. 0 |838. 0 |1,110. 0 |869. 0 | |Non-Financial Assets | | |14. 1 |16. 0 | |Long Term Debt |100. 0 |123. 0 |164. 0 |168. 0 | |Shareholder Equity |28. 0 |35. 8 |42. 8 |64. 4 | JP Morgan Chase

JP Morgan Chase is one of the largest financial services firms in the US. The company has more than 5,000 bank branches in some two dozen states (and growing) and is also among the nation’s top mortgage lenders and credit card issuers. Active in some 60 countries, it also boasts formidable investment banking and asset management operations. The company’s subsidiaries include the prestigious JP Morgan Private Bank and institutional investment manager JP Morgan Asset Management (with some $1. 5 trillion in assets under supervision). In 2008 JP Morgan Chase bought Bear Stearns and the operations of failed thrift Washington Mutual (WaMu). Financial Situation for JP Morgan Chase (In $ billions) |2005 |2006 |2007 |2008 | |Total Revenue |79. 9 |99. 3 |116. 0 |101. 0 | |Operating Profit | | | | | |Financial Assets |1,130. 0 |1,280. 0 |1,490. 0 |2,100. 0 | |Non-Financial Assets |67. 3 |68. 8 |69. 3 |73. | |Long Term Debt |120. 0 |164. 0 |228. 0 |403. 0 | |Shareholder Equity |107. 0 |116. 0 |123. 0 |167. 0 | Bank of America Securities Bank of America Securities makes its marc as the investment banking arm of Bank of America. The subsidiary, along with its UK affiliate Bank of America Securities Limited, offers trading and brokerage services; securities underwriting; debt and equity research; and advice on public offerings, leveraged buyouts, and mergers and acquisitions.

Specialty units focus on commission management, derivatives, securitization, and other services. Bank of America Securities’ client list includes corporations (including many Fortune 500 firms), institutional investors, and government entities. Bank of America acquired troubled investment bank Merrill Lynch for some $50 billion in early 2009. Financial Situation for Bank of America Securities (In $ billions) | |2005 |2006 |2007 |2008 | |Total Revenue |65. 4 |85. 1 |117. 0 |77. | |Operating Profit |35. 7 |52. 4 |76. 0 |73. 8 | |Financial Assets |1,230. 0 |1,380. 0 |1,620. 0 |1,700. 0 | |Non-Financial Assets |59. 1 |84. 3 |99. 1 |117. 0 | |Long Term Debt |101. 0 |146. 0 |198. 0 |268. 0 | |Shareholder Equity |102. 0 |135. 0 |147. |177. 0 | Over the recent few years financial sector has become more unstable and uncertain, as many institutions involved in financial services declared bankruptcy. The financial crisis of 2008 has worsened companies’ financial position and many of the major financial institutions were forced to merge (Wachovia Bank Well Fargo) or received government assistance (AIG or Bank of America). These will result in weaker companies becoming stronger in competition because they increased in sized and capital. Strong market position depends on the companies’ reputation and the quality of their offered products, services and advice.

Morgan Stanley strategically offers to its clients a product mix base on the demand in each sector. The following chart shows the combination of the products that the firm believes to help assure a greater sale in the global market. The chart shows clearly that Asset Management (30%) makes the biggest part of the company’s market follow by Global Wealth Management (24%), Equity Sales & trading (22%), and Investment Banking (15%). Assets management and other institutional Security sale are respectively 5% and 4%. Morgan Stanley’s institutional securities, wealth management and asset management lost from the financial markets crisis during 2008. Morgan Stanley Revenue by segment (2007 & 2008 in $ Billions) |2007 |2008 | |Investment Banking |6. 37 |4. 09 | |Wealth Management Group |5. 92 |6. 08 | |Institutional Security |14. 20 |14. 21 | |Assets management |5. 53 |1. 49 | [pic] Source: Morgan Stanley SEC Filings 8. Financial analysis 8. 1. Highlights – First Half 2009

Morgan Stanley SEC filling gives some highlights of the company’s performance in the first half of 2009 as follows: delivered strong results in Investment Banking, and in Commodities, Rates & Credit Products but overall Fixed Income underperformed peers, currently, ranked # 1 in announced and completed global M&A by Thomson Reuters and Morgan Stanley credit spread improvement resulted in negative revenues of $3. 9bn. The Joint Venture (JV) with Smith Barney ahead of schedule on May 31. As of June 30, MS had 18,444 global financial representatives, $1. 4tr in total client assets and $106bn JV Bank Deposit Program. 8. 2. Overview of financial situation

Morgan Stanley’s financial report 2008 shows a 47% decrease in net income in fiscal year 2008 to $1,707 million, compared to 2007 net income equaled $3,209 million. The Net revenue (total revenues less interest expense) decreased 12% from $27,979 million in 2007 to $24,739 million in fiscal 2008. Institutional Securities and Global Wealth Management had increased 3% and 6% respectively. The increase recorded in Institutional Securities is due to record equity sales and trading results, higher fixed income sales and trading due to lower net mortgage related losses. Global Wealth Management Group income increase was dictated by higher net interest revenue from growth in bank deposit program. Asset Management had decreased 325% with a loss of $1,807 million compared to the gain of year prior year.

These losses were related primarily to net investment losses associated with banking business, which includes the real estate, private equity and infrastructure business. Non-interest expenses decreased 9% to $22,452, primarily due to lower compensation costs, and partly offset by goodwill and intangible asset impairment charges. Compensation and benefits expense decreased 26%, reflecting lower incentive-based compensation accruals due to lower net revenues in certain division of the Company’s businesses. Diluted earnings per share were $1. 45 compared with $2. 98 a year ago. Diluted earnings per share from continuing operations were $1. 54 compared with $2. 37 last year. The return on average common equity in fiscal 2008 was 4. 9% compared with 8. 9% in 2007.

The return on average common equity from continuing operations for fiscal 2008 was 5. 2% compared with 7. 8% in fiscal 2007. The 2008 financial crisis led to the decline of the prices of various assets. Losses that mainly came from collapsing sector of individual and commercial mortgages has grown and spread to other areas like corporate debt, convertible securities and emerging market debt and equity during 2008. The company’s performance decrease during the crisis results in the shrinking of its stock price. The following graph shows the open and close price of the company’s stock at the end of the last ten fiscal years. [pic] Data: from www. Yahoo. com/finance 9. SWOT analysis 9. 1.

Strength and weakness analysis (internal factors) |Strength |Weakness | |Marketing leading position |Not sufficient funds | |Qualified employees |Sensitivity to investment market | |Fast and specialized services | | |Variety of offered services | | Strengths: Marketing leading position Morgan Stanley is a leader in both individual and corporate sponsored financial markets. The company ranks high in financial services and products in the US. Based on the revenues Morgan Stanley is 30th largest US corporation on the Fortune 500 list. Morgan Stanley is leading provider of the financial products designed specifically to for the individual and business markets. Qualified employees Qualified employees are one of the most key factors that company requires.

Hiring only well educated and experienced work force leverage the quality and reliability of the performed services as well as continue to increased good reputation and trust. Fast and specialized services By offering the financial advisory services company maintain the high level performance by specialized and qualified employees. MS formed the largest wealth management business with Citi as measured by financial advisory. Variety of offered services Customized services and products for individual and business customers make company very competitive and well recognized on the financial market. Weaknesses: Not sufficient funds Company may suffer from not sufficient funds in the order to progress and growth comparing to its competitors.

Sensitivity to investment market Most of Morgan’s Stanley earnings are derived from financial markets products. This is an above average exposure to the financial markets. Though Morgan Stanley’s institutional securities, wealth management and asset management lost from the financial markets crisis during 2008. 9. 2. Opportunities and threats analysis (External forces) |Opportunities |Threats | |Recovery in investment market |Intense competition in US financial market | |New products fferings |Market trends | |Reputation |Financial regulations | |Growth in financial business | | Opportunities: Recovery in the financial markets Financial markets in US have been slowly recovering. Investments banking companies would benefit from the recovery and would be reflected in strong sales of key players in the US market. The recovery in financial markets should improve return on the sales of investments products for investment banking sector. Additional funds from targeting $2 million in cost savings by reducing headcount in 2009. New products offering

Morgan Stanley specialize in three main sectors like security underwriting and distribution, financial advisory services, sales , trading and other related products including foreign exchange and investment activities. Morgan Stanley offers an entire suit of high-end financial products. Offering financial advisory program combined with of financial products is expected to bring high income. Launching a Retail Banking business to built bank deposits leveraging company’s existing banking capabilities and financial holding company structure. Reputation Morgan Stanley as a well known worldwide company has been working many years to receive status of trust worth business and provides ability to continue improve in this area. Growth in financial business Company expects a huge opportunity within the increase of income stage of the customers.

Financial business is growing; however market stabilization increase clients’ willingness in purchasing the company’s products or services which provide the revenue. Develop a global alliance with Mitsubishi UFJ Financial Group Inc to enhance investment and corporate banking, retail banking and lending activities. Threats: Intense competition in US financial market All businesses Morgan Stanley is involved are highly competitive due to the market structure and the number of the competitors. Also many products offered y Morgan Stanley are similar to products offered by other financial companies and banks. Market trends Financial markets rely on its customers and economical situation. Market trends are dictated sometime by big investors who coordinate and direct the sales from individual customers.

Important is to fit and deliver these expectations. 10. Global Issues National Bureau of Economic Research announced in 2008 that U. S. entered into a recession. The crisis had drastically impact U. S. financial services industry. Many financial institutions declared bankruptcy (Lehman Brothers), consolidated or were forced by the government to merge (The Bears Stearns, Wachovia Corporation and Federal Home Loan Mortgage Corporation) as people lack confidence in the financial sector, and are concern about the future change and the viability of financial organization. Unemployment rates all over the world increased dramatically reaching the highest levels from 15 years ago.

Banks freeze credits for both institutional and individual borrowers has worsen the situation. To improve situation, central banks reduced interest rates globally. In Europe, the economy crisis slowed down the economic growth as export demand decreased, housing prices declined and consumer spending and business investments slowed. The most expensive commodity-producing countries are Brazil, Chile, Taiwan, Malaysia and Russia. On those markets Morgan Stanley is underweight because of the echo bubbles. That is why Morgan keeps lower percentage of commodity stocks including metals, materials and energy and higher percentage in consumer stocks including automobiles, retails and beer companies. 11. Company’s strategy In the letter John J.

Mack (CEO) on March 16, 2009 recognized that the markets remain challenging, but does not change anything of the strategic priorities. The priorities are to continue shifting people and capital to the most promising opportunities, in order to adapt the business accordingly, to reduce rigorously costs by $2 billion from the last year and legacy exposure further as conditions allow, and change the way they pay their people—including being the first major U. S. bank to institute a “claw back” provision for deferred year-end compensation. Thus Company entered a joint venture with Citigroup in 2009 and became bank holding company. Thus the Global Wealth Management franchise into the new Morgan Stanley Smith Barney joint venture must build out a new Retail Banking Group.

In addition, they will work with their new strategic partner, MUFG, to realize the full potential of this strategic alliance Morgan also in the order to reinforce its position in financial sector developed a global alliance with Mitsubishi UFJ Financial Group, Japan’s largest banking group to pursue initiatives in corporate and investment banking, retail banking and lending operations. The company’s core strategy is that although the financial markets right now are challenging, it has become increasingly clear that there are still attractive opportunities for the Firm to take advantage of, so they must move quickly, stay close to their clients to help them navigate these hallenging markets, and above all, stay intensely focused on delivering long-term value to the shareholders, by capitalizing on the full potential of the Morgan Stanley franchise.

These can be done through the improvement of the institutional securities sector, execution of the global wealth Management, and the optimization of the assets management. The first include refocusing the business and building client footprint and product scale, significant market share opportunities, disciplined operating approach with superior risk analytics, and investing in intellectual leadership and talent. The second focus on integrating Morgan Stanley Smith Barney joint venture, generating cost and revenue synergies, growing net new money and deposits, driving banking product suite and lowing capital usage.

The third will cover the redefinition of the business, improvement of investment performance, reduction of cost base, the restructuring of Institutional and Retail businesses, and the re-alignment of Merchant Banking. Finally the company believes in a strategic elimination of possible daily lose on the trading operations and support actions that attract more deposits. Morgan Stanley is really interested in building up the deposit base therefore will be adding more employees to expand the banking operations. The bank nearly tripled its customers’ deposits to over $100 billion, but has lowered its payroll by 8% in the past year.

12. Regulations Since Morgan Stanley became a financial holding company and licensed broker-dealer Morgan Stanley Bank, N. A. s a subject to the supervision and regulation of the Federal Reserve System and has became also a subject to the consolidated supervision and regulation of the Office of the Comptroller of the Currency. The Federal Deposit Insurance Corporation will continue to insure deposits to the maximum extent allowed by FDIC. The Company does not expect significant adverse tax or accounting effects from this status. The most recent regulatory provisions obligate investment banking to provide its clients with information related to client categorization, financial instruments and risks involved, client orders execution, conflict of interest and measures that guarantees the client financial instruments or cash. Many investment bankers fear tighter regulation, afraid it could slower to make decisions and that they could face constrains on their capital.

However potential conflicts of interest within the bank are possible and develop potential fear of manipulation. The regulatory requirement prudent Chinese wall, which distinguish communication between investment bank on one hand equity research and on the other hand trading. Another illegal practice is front running, where broker executes orders on securities for his own account before filling orders previously submitted by its clients. Regulations also protect investment banking against political manipulation where people try to adjust law to their profit. 13. Conclusion and recommendation Morgan Stanley is one of the leading financial services company worldwide.

Armed with qualified employees who deliver quality products and high level services, the company maintains high performance. However, the company may suffer from insufficient fund to finance its growth and from the sensitivity to the investment market for the fact that the most of its earnings are derived from financial market product and services. The threats to the business are also is the intense. The competition in the financial market and the market trend that is a reflection of customer and economic situation (financial crisis, decrease of purchasing power, employment rate) are the most the company will be facing. But as Dennis Gartman, founder of the Gartman Letter remarked, Morgan Stanley is “viable business”.

It will not disappear, unless the company misses to take advantage of the opportunities that are offered to it at the exit of the financial crisis. The slow but sure recovery offers the company to come up with new product to its client as its reputation precedes its name in the word. It is the only exit the company has to expand and to assure its leadership position in the market. References: Braverman, Beth (2009). Financial services firms focus on stability B to B, Vol. 94 Issue 2, p3-32, 2p. CNBC. com | 15 Sep 2008 | 05:22 AM ET retrieved Official: ‘Morgan Stanley Smith Barney’, Joe Bel Bruno. Wall Street Journal. (Eastern edition). New York, N. Y. : Jun 2, 2009. pg. C. 6, Stephen Gandel, (2009, September 22), How the financial crisis reshaped Morgan Stanley, Time,

David J. Lynch, (2008, October 30), Global financial crisis may hit hardest outside U. S. , Usa Today, Kellerhals, Richard (Sep 2009) Morgan Stanley Inks $2. 5B CF Industries Deal, High Yield Report; Vol. 20 Issue 45, p2-2, 1p, Ruffle, John F( Jan/Feb 1989) Reform the Glass-Steagall Act Financial Executive, Vol. 5 Issue 1, p43-43, 1/3p;. , Dolbeck, Andrew (sep 2008) Three Big Banks: Changes at Goldman, Morgan, and WaMu. Weekly Corporate Growth Report, Issue 1509, p1-12, 3p, Kennard, Alan (Apr 2009) American Recovery and Reinvestment Act of 2009 Provides New Business Tax Incentives Corporate Business Taxation Monthly, Vol. 10 Issue 7, p11-51, 11p. ,

Henry, David; Francis, Theo(Jul 2009) ARE BANKS PLAYING IT TOO SAFE? , Business Week, Issue 4145, p026-027, 2p. , Nygard, Stephanie G. ; Minchella, Sabrina; Lenet, Sara C. (2009) Emergency Economic, Stabilization Act of 2008: Implications for Banking Institutions, Real Estate Finance Journal, Vol. 24 Issue 3, p54-58, 5p Wall Street Journal (Sep 11, 2009), For Morgan Stanley, Silence About John Mack Is Golden,

http://blogs. wsj. com/deals/2009/09/11/for-morgan-stanley-silence-about-john-mack-is-golden/

http://finance. yahoo. com/q/bc? s=MS 1

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http://www. morganstanley. com/about/company/history. html

http://www. morganstanley. com/about/ir/shareholder/10k113008/10k1108. pdf

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http://www. marketwatch. com/story/morgan-stanley-reports-third-quarter-results-2009-10-21

http://sify. com/finance/morgan-stanley-gets-lifeline-news-default-jegwl4bedbc. html

http://www. morganstanley. com/about/ir/pdf/BarclaysConf_09152009. pdf

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