In January, Gorman leaped past JPMorgan’s Jamie Dimon as the best-paid CEO of a major U.S. bank, after being awarded $33 million for the firm’s performance in 2020 while running a firm that’s a third the size of JPMorgan.
One reprieve for Gorman’s firm was the timing of the fund’s blowup. In any other quarter, the losses would have stood out more starkly. Instead, the hit came at a time when the bank and all its major peers have smashed one record after another, helping dull the pain.
“Such a shame we have to talk about the” Archegos hit, given the strong results throughout the rest of the firm, Glenn Schorr, an analyst at Evercore ISI, said in a report titled, “Other Than That, It Was a Great Quarter, Mrs. Lincoln.”
Fixed-income trading revenue at Morgan Stanley rose 44% to $2.97 billion, compared with the $2.2 billion analysts were predicting before earnings season kicked off.
Morgan Stanley’s investment bankers pulled in $2.61 billion in fees, compared to the $2 billion analyst estimate, as equity underwriting quadrupled. The quarter proved particularly lucrative with the continued explosion in blank-check companies, better known as SPACs, as well as public offerings from technology companies.
Banks are also having to fend off fierce demand for their top talent, with venture-capital firm General Catalyst this month luring away Paul Kwan, Morgan Stanley’s head of West Coast technology investment banking.
Wealth-management revenue totaled $5.96 billion, up from $5.68 billion in the previous quarter.
The acquisition of E*Trade last year also proved timely, as average daily trading surged in the first quarter, well above its fourth-quarter record. The firm also announced the completion of the Eaton Vance takeover last month, adding another business likely to throw off consistent fee-based revenue.
—With assistance from Felice Maranz.
This article was provided by Bloomberg News.