Morgan Stanley's wealth management arm has reported a pre-tax income from continuing operations of $859m for the second quarter of 2016, down 2.9% from $885 in the year-ago quarter.
For the quarter ended 30 June 2016, the unit's net revenues were $3.8bn compared with $3.9bn in the second quarter of 2015, while pre-tax margin was 22.5%.
The division’s asset management fee revenues fell to $2.1bn from $2.2bn a year earlier, reflecting lower average fee rates related to fee-based accounts and lower market levels, partially offset by positive flows quarter.
Transactional revenues dropped 8.5% year-on-year to $798m from $872m. The decrease mainly reflected lower commission revenues and lower levels of new issue activity, the US banking major said in its earnings statement.
The wealth management arm reported a net interest income of $829m for the quarter, a rise of 12.5% from $737m during the same quarter in 2015 on higher deposit and loan balances.
At the end of the quarter, total client assets reached $2 trillion, while client assets in fee based accounts were $820bn and fee based asset flows were $12bn.
The banking group said that the unit's 15,909 wealth management representatives generated average annualized revenue per representative of $959,000 in the quarter.
Wealth management client liabilities stood at $69bn, up $11 billion compared with the corresponding quarter of 2015.
Overall, the banking group posted net revenues of $8.9bn for the second quarter of 2016, compared with $9.7bn a year ago. Net income applicable to Morgan Stanley was $1.6bn, down 12% compared with $1.8bn in the prior year.
Morgan Stanley chairman and CEO James Gorman said: “Our results this quarter reflect solid performance in an improved but still fragile environment. In the midst of market uncertainty, we maintained our leadership positions across our core franchises and continued our focus on prudent risk management and judicious expense control.
“We remain committed to executing for our clients and delivering on our strategic priorities for our shareholders.”