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MORGAN STANLEY DEAN WITTER *1998 ANNUAL REPORT
*FOUR *
Dear Shareholders,
1998 was a turbulent year in the world’s financial markets,but Morgan Stanley Dean
Witter performed exceptionally well.We were there for our clients, and our share-
holders were rewarded with strong financial results:
*Morgan Stanley Dean Witter earned a record $3.3 billion in 1998,an increase of $690 million,or 27
percent over 1997. Diluted earnings per share were $5.33 — up 28 percent from $4.16 in 1997.
*Return on equity was 24.5 percent, which compares favorably with our goal of an average of
18 percent to 20 percent over the course of the business cycle.
*In January 1999, our Board of Directors increased the quarterly cash dividend per common share by
20 percent to $0.24.
1998 was a year in which we set ourselves apart from our competitors. Many firms
in our industry suffered large trading losses, announced layoffs and began to scale
back on their global commitments. Our disciplined approach to trading and risk
management kept us on an even keel; we continued to expand the number of
financial advisors serving individual investors;and we achieved record results in our
individual securities, individual asset management and credit services businesses.We
increased our commitment to global markets with a 20 percent staff increase in
Europe and 10 percent in Asia.
There are countless examples of how we have served our clients and customers
during difficult times this past year. Perhaps the most dramatic example was our
role as lead-manager in raising $4.4 billion in the first step of DuPont’s spin-off of
Conoco, which was the largest U.S. initial public offering in history.The timing of
the deal was particularly significant since it was launched in late September when
market turmoil had virtually frozen the new issues business.We believe it is an
example of our firm’s leadership and our ability to execute superbly in even the
most difficult market conditions.
A deal such as Conoco brings together the skills and talent of literally thousands of
Morgan Stanley Dean Witter professionals.We believe our firm’s combined origi-

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