Morgan Stanley 2014 Annual Report Download - page 82

includes interest related to the bank deposit program, interest on AFS securities and HTM securities, interest on
lending activities and other net interest. Other revenues include revenues from AFS securities and HTM
securities, customer account services fees, other miscellaneous revenues and revenues from Investments.
2014 2013(1) 2012(1)
(dollars in millions)
Net revenues:
Transactional .................................................. $ 3,875 $ 4,293 $ 3,963
Asset management .............................................. 8,345 7,571 7,101
Net interest .................................................... 2,339 1,875 1,560
Other ......................................................... 329 404 323
Net revenues ............................................... $14,888 $14,143 $12,947
(1) On October 1, 2014, the Managed Futures business was transferred from the Company’s Wealth Management business segment to the
Company’s Investment Management business segment. All prior-period amounts have been recast to conform to the current year’s
presentation.
2014 Compared with 2013.
Transactional.
Investment Banking. The Company’s Wealth Management business segment’s investment banking revenues
include revenues from the distribution of equity and fixed income securities, including initial public offerings,
secondary offerings, closed-end funds and unit trusts. Investment banking revenues decreased 14% from 2013 to
$791 million in 2014, primarily due to lower levels of underwriting activity in closed-end funds partially offset
by higher revenues from structured products.
Trading. Trading revenues include revenues from customers’ purchases and sales of financial instruments, in
which the Company acts as principal, gains and losses on the Company’s inventory positions, which are held
primarily to facilitate customer transactions, and gains and losses associated with certain employee deferred
compensation plans. Trading revenues decreased 18% from 2013 to $957 million in 2014, primarily due to lower
gains related to investments associated with certain employee deferred compensation plans and lower revenues
from fixed income products.
Commissions and Fees. Commissions and fees revenues primarily arise from agency transactions in listed and
OTC equity securities and sales of mutual funds, futures, insurance products and options. Commissions and fees
revenues decreased 4% from 2013 to $2,127 million in 2014, primarily due to lower equity, insurance and mutual
fund activity.
Asset Management.
Asset Management, Distribution and Administration Fees. See “Business Segments—Net Revenues” herein
for information about the composition of Asset management, distribution and administration fees.
Asset management, distribution and administration fees increased 10% from 2013 to $8,345 million in 2014, primarily
due to higher fee-based revenues partially offset by lower revenues from referral fees from the bank deposit program.
The referral fees for deposits placed with Citi-affiliated depository institutions declined to $81 million in 2014 from
$240 million in 2013, reflecting the ongoing transfer of deposits to the Company from Citi.
Balances in the bank deposit program were $137 billion at December 31, 2014 and $134 billion at December 31,
2013, which included deposits held by the Company’s U.S. Subsidiary Banks of $128 billion at December 31,
2014 and $104 billion at December 31, 2013.
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