Morgan Stanley 2015 Annual Report Download - page 69

2015 Compared with 2014.
Net Revenues.
Investments.
• Investments of $249 million in 2015 decreased 58% from the prior year reflecting the reversal of previously accrued
carried interest associated with Asia Private Equity and additional net markdowns on principal investments.
Asset Management, Distribution and Administration Fees.
• Asset management, distribution and administration fees were unchanged from the prior year as the impact of
positive net flows was offset by a shift in the asset class mix from equity and fixed income products to liquidity
products, (see “Statistical Data” herein).
Other.
• Other revenues of $32 million in 2015 decreased 70% from the prior year due to lower revenues associated with the
Company’s minority investment in certain third-party investment managers.
Non-interest Expenses.
Non-interest expenses of $1,823 million in 2015 decreased 11% from the prior year primarily due to lower Compensation
and benefit expenses partially offset by higher Non-compensation expenses.
• Compensation and benefits expenses decreased primarily due to the 2014 compensation actions, a decrease in
deferred compensation associated with carried interest and a decrease in the level of incentive compensation in 2015
(see also “Supplemental Financial Information and Disclosures—Discretionary Incentive Compensation” herein).
• Non-compensation expenses increased primarily due to higher Brokerage and clearing, Professional services,
resulting from higher consulting and legal fees and Information processing and communications expenses.
2014 Compared with 2013.
Trading.
• Trading losses of $19 million in 2014 compared with gains of $41 million in 2013 primarily reflected losses related
to certain consolidated real estate funds sponsored by the Company.
Investments.
• Investments of $587 million in 2014 decreased 44% from the prior year primarily related to lower net investment
gains, lower carried interest in the Merchant Banking and Real Estate Investing businesses and lower gains from
investments in the Company’s employee deferred compensation and co-investment plans. 2014 results were also
negatively impacted by the deconsolidation in the second quarter of 2014 of certain legal entities associated with a
real estate fund sponsored by the Company.
Asset Management, Distribution and Administration Fees.
• Asset management, distribution and administration fees of $2,049 million in 2014 increased 7% from the prior year
primarily reflected higher management and administration revenues as a result of higher average assets under
management (“AUM”), (see “Statistical Data” herein).
Other.
• Other revenues of $106 million in 2014 increased from $32 million in 2013 primarily due to higher revenues
associated with the Company’s minority investment in certain third-party investment managers and a $17 million
gain on sale of a retail property space.
63