Morgan Stanley 2010 Annual Report Download - page 63

Supplemental Financial Information.
Investment Banking.
Investment banking revenues are composed of fees from advisory services and revenues from the underwriting of
securities offerings and syndication of loans, net of syndication expenses.
Investment banking revenues were as follows:
2010 2009(1)
Fiscal
2008
One Month
Ended
December 31,
2008
(dollars in millions)
Advisory fees from merger, acquisition and restructuring
transactions ............................................. $1,470 $1,488 $1,740 $ 68
Equity underwriting revenues ................................. 1,454 1,695 1,045 47
Fixed income underwriting revenues ........................... 1,371 1,272 845 62
Total investment banking revenues ......................... $4,295 $4,455 $3,630 $177
(1) All prior-period amounts have been reclassified to conform to the current period’s presentation.
Sales and Trading.
Sales and trading revenues are composed of Principal transactions—Trading revenues; Commissions; Asset
management, distribution and administration fees; and Net interest revenues (expenses). In assessing the
profitability of its sales and trading activities, the Company views Principal transactions—Trading;
Commissions; Asset management, distribution and administration fees; and Net interest revenues (expenses) in
the aggregate. In addition, decisions relating to principal transactions are based on an overall review of aggregate
revenues and costs associated with each transaction or series of transactions. This review includes, among other
things, an assessment of the potential gain or loss associated with a transaction, including any associated
commissions, dividends, the interest income or expense associated with financing or hedging the Company’s
positions, and other related expenses.
Sales and trading revenues were as follows:
2010 2009(1)
Fiscal
2008(1)
One Month
Ended
December 31,
2008(1)
(dollars in millions)
Principal transactions—Trading ............................. $ 8,154 $6,591 $ 5,897 $(1,462)
Commissions ............................................ 2,274 2,152 3,094 127
Asset management, distribution and administration fees .......... 104 98 142 10
Net interest .............................................. (266) (124) 1,744 (107)
Total sales and trading revenues ......................... $10,266 $8,717 $10,877 $(1,432)
(1) All prior-period amounts have been reclassified to conform to the current period’s presentation. See “Business Segments” and “Other
Matters—Dividend Income” herein for further information.
The components of the Company’s sales and trading revenues are as follows:
Principal Transactions—Trading. Principal transactions—Trading revenues include revenues from customers’
purchases and sales of financial instruments in which the Company acts as principal and gains and losses on the
Company’s positions, as well as proprietary trading activities for its own account.
Commissions. Commission revenues primarily arise from agency transactions in listed and over-the-counter
(“OTC”) equity securities and options.
57