Morgan Stanley reports $1.2 billion Q2 loss
22 Jul 2009
US investment bank Morgan Stanley today reported a second quarter 2009 (April-July) loss of more than $1.2 billion, due mainly to the charge on the government bailout money as also the rising cost of its own debt.
Morgan Stanley's net loss after payment of preferred dividends was $1.26 billion, or $1.10 per share as against earnings of $1.06 billion ($1.02 per share), a year earlier, it said.
The investment bank also recorded an $850 million (74 cents per share) charge on the government bailout money it received under the Troubled Asset Relief Programme.
New York-based Morgan Stanley also lost money on valuation of its debt under the accounting norms rule related to the valuation of debt, which makes it mandatory for companies to allocate more money, at least on paper, to meet its obligations when its debt is high.
This is the third consecutive loss for the investment bank in so many quarters and is worse than analysts have expected.
On the other hand, rivals like Wells Fargo, New York Mellon, Goldman Sachs and J P Morgan have reported huge gains in second quarter profits.
