Morgan Stanley 2005 Annual Report Download - page 20

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Q4.
You have talked about
the benefits of more fully
integrating Morgan Stanley’s
businesses. What are the
opportunities that you
see there?
Answer:
The Morgan Stanley-Dean Witter merger gave us the scale and
scope that we need to compete in the current global marketplace.
However, we need to more fully integrate the two businesses.
For example, in the Retail Brokerage business, we still have two
technology platforms and two compensation systems. We are
focused now on fully integrating the businesses and truly creat-
ing one firm, and we already have started realizing some of that
potential. For instance, we have had increased success in deliver-
ing to individual investors some of the more sophisticated prod-
ucts, such as our real estate private equity funds, that leverage our
leadership and capabilities in Institutional Securities.
Q5.
You’ve talked about the
need to make greater
investments in technology.
What are Morgan Stanley’s
highest priorities in
this area?
Answer:
On the retail side of the business, we want to ensure that all our
people have the best possible tools to serve our clients, so we’re
going to upgrade our technology platforms and provide our finan-
cial advisors and investment representatives with a tool kit that is
as competitive as that of our leading peers. On the institutional
side of the business, we’re very focused on ensuring we have the
technology in our fixed income and equities divisions to deliver
multi-asset-class products for our clients. We’ll also look at oppor-
tunities to integrate the technology platforms across our businesses,
but we’re going to do it in a very disciplined and economic way.
Q6.
Margins in the Retail
Brokerage business have, for
some time, lagged those of
leading peers. How are you
going to close that gap, and
what makes you think Morgan
Stanley can be competitive in
the retail business?
Answer:
We have a strong Retail Brokerage franchise. It’s a tremendous
asset with many high-quality financial advisors and investment
representatives and $617 billion in client assets. We need to invest
in the retail business to realize its full potential. We need to
expand our product offerings, bringing new and creative products
to our retail client base through our retail sales force. We also
need to continue to build our high-net-worth and ultra-high-
net-worth business, which is a key target for growth and invest-
ment. And we need to invest in technology and compliance, as
well as in our most productive financial advisors and investment
representatives. It’s going to take time to get the retail business
where we want it to be, but we’ve already begun taking some
of the necessary steps to improve profitability and margins, and
James Gorman will be helping us to achieve the full potential of
this business.
MORGAN STANLEY ANSWERS YOUR QUESTIONS