Morgan Stanley 1998 Annual Report Download - page 53

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MORGAN STANLEY DEAN WITTER *1998 ANNUAL REPORT
*FIFTY
-SEVEN *
fiscal year (dollars in millions) 1998 1997 1996
CASH FLOWS FROM OPERATING ACTIVITIES
Net income $ 3,276 $ 2,586 $ 1,980
Adjustments to reconcile net income to net cash provided by (used for)
operating activities:
Non-cash charges included in net income:
Cumulative effect of accounting change 117 — —
Gain on sale of businesses (685) — —
Deferred income taxes (55) (77) (426)
Compensation payable in common or preferred stock 334 374 513
Depreciation and amortization 575 338 251
Provision for consumer loan losses 1,173 1,493 1,214
Changes in assets and liabilities:
Cash and securities deposited with clearing organizations or segregated
under federal and other regulations (3,641) (1,691) (1,943)
Financial instruments owned, net of financial instruments sold,
not yet purchased 11,127 1,730 (2,536)
Securities borrowed, net of securities loaned (5,061) (10,561) (13,087)
Receivables and other assets 2,114 (13,808) (8,227)
Payables and other liabilities 6,095 19,058 6,910
Net cash provided by (used for) operating activities 15,369 (558) (15,351)
CASH FLOWS FROM INVESTING ACTIVITIES
Net (payments for) proceeds from:
Office facilities (358) (301) (152)
Sale of businesses, net of disposal costs 1,399 — —
Purchase of Miller Anderson & Sherrerd, LLP, net of cash acquired — — (200)
Purchase of Van Kampen American Capital, Inc., net of cash acquired — — (986)
Net principal disbursed on consumer loans (2,314) (4,994) (7,532)
Purchases of consumer loans — (11) (51)
Sales of consumer loans 4,466 2,783 4,824
Other investing activities — (5) (40)
Net cash provided by (used for) investing activities 3,193 (2,528) (4,137)
CASH FLOWS FROM FINANCING ACTIVITIES
Net proceeds from (payments for) short-term borrowings 5,620 (1,336) 8,106
Securities sold under agreements to repurchase, net of securities purchased
under agreements to resell (14,407) 3,080 7,748
Net proceeds from (payments for):
Deposits (796) 2,113 1,022
Issuance of cumulative preferred stock — — 540
Issuance of common stock 186 194 156
Issuance of long-term borrowings 9,771 6,619 8,745
Issuance of Preferred Securities Issued by Subsidiaries 400 — —
Issuance of Capital Units — 134 —
Payments for:
Repayments of long-term borrowings (7,069) (3,964) (2,637)
Redemption of cumulative preferred stock (200) (345) (138)
Repurchases of common stock (2,925) (124) (1,133)
Cash dividends (519) (416) (313)
Net cash (used for) provided by financing activities (9,939) 5,955 22,096
Dean Witter, Discover & Co.’s net cash activity for the month of December 1996 — (1,158) —
Net increase in cash and cash equivalents 8,623 1,711 2,608
Cash and cash equivalents, at beginning of period 8,255 6,544 3,936
Cash and cash equivalents, at end of period $ 16,878 $ 8,255 $ 6,544
See Notes to Consolidated Financial Statements.
CONSOLIDATED STATEMENTS OF CASH FLOWS