Morgan Stanley's Q3 Profit Soars with Dealmaking Resurgence

Morgan Stanley's profit rose significantly in Q3, driven by a resurgence in dealmaking activities, including corporate debt issuance and IPOs. The bank's profits jumped to $3.19 billion, or $1.88 per share, an increase from last year's figures. The investment banking sector is optimistic about continued M&A growth.

In the third quarter, Morgan Stanley saw a significant rise in profits, largely fueled by a resurgence in dealmaking that had similarly benefited its industry peers.

The investment bank reported a substantial profit of $3.19 billion, equating to $1.88 per share, for the quarter ending September 30. This represents a notable increase from the $2.41 billion, or $1.38 per share, recorded during the same period last year. A comeback in corporate debt issuance, initial public offerings, and mergers significantly boosted investment banking profits this year.

With markets nearing historic highs and the U.S. Federal Reserve beginning its policy-easing efforts, bankers have expressed optimism that merger and acquisition activity will continue to bounce back following a two-year slowdown. Morgan Stanley's investment banking revenue surged by 56% in the third quarter. Competitors like Goldman Sachs and JPMorgan Chase also reported significant gains, with a 20% increase in fees and a 31% growth, respectively. Across the sector, global investment banking revenues climbed by 21% over the year's first nine months, driven by a remarkable 31% rise in North America, as shown by Dealogic data. Morgan Stanley ranked fourth globally in fees earned during this period.

(With inputs from agencies.)