Morgan Stanley's wealth management customers added far less money to their fee-based accounts in the third quarter than earlier this year, despite the firm's promotion of the lucrative accounts.

The bank's wealth division attracted $6.5 billon of new assets to the accounts, down 57 percent from $15 billion in the year-ago period and off 48 percent from this year's second quarter, the bank said Friday.

U.S. brokerage firms have been promoting fee-based advisory accounts that charge clients a percentage of the total assets held in the accounts. They say fee accounts are more stable, and often more profitable, than commission accounts that only charge when clients make a trade.

Transactional revenue at Morgan Stanley's wealth management unit in the third quarter fell to $912 million from $1.0 billion in the year-ago quarter.

Overall revenue in Morgan Stanley's wealth management unit nevertheless grew 9 percent from last year and 2 percent from this year's second quarter to a record $3.8 billion, or 42 percent of the company's total revenue.

The gain was driven by higher net interest income from bank loans to wealth management clients, and fees that grew on "tailwinds from higher markets," Morgan Stanley Chief Executive James Gorman said, referring to the 6.7 percent gain in the Standard & Poor's 500 index in the third quarter.

Wells Fargo & Co. and Bank of America Corp. earlier this week reported gains in their respective Wells Fargo Advisors and Merrill Lynch wealth units, largely driven by double-digit increases in fee-based managed accounts.

Morgan Stanley Chief Financial Officer Ruth Porat shrugged off the third-quarter retreat in new fee-based assets. "We've had strong flows throughout the year," she said on a conference call Friday. She attributed the decline to "timing issues," without elaborating.

Pretax profit in the wealth unit rose 25 percent to $836 million, or 37.2 percent of the parent bank's total pretax profit of $2.24 billion.

Morgan Stanley attributed much of its wealth unit gains to brokers' progress in selling loans. Morgan Stanley's wealth management clients buy far fewer bank products than do customers of brokerage firms owned by larger commercial banks such as Wells Fargo and Bank of America, according to Gorman and Porat.

Residential real estate loans in the wealth unit soared 61 percent to $14.3 billion last quarter from a year earlier. Brokers also sold $20.3 billion loans collateralized by clients' portfolios, up 48 percent from $13.7 billion a year earlier.

Morgan Stanley is the world's biggest brokerage firm, as measured by its 16,162 brokers as of Sept. 30. The total is down by 355 from a year earlier.