Morgan Stanley Wealth Management today reported pre-tax income from continuing operations of $668 million for this year's third quarter, up from $247 million and $655 million logged a year ago and in Q2 2013 respectively.

Net revenues for the current quarter were $3.5 billion, basically unchanged from the previous quarter but up from $3.2 billion a year ago. The pre-tax margin was 19 per cent for Q3 2013.

Morgan Stanley said that results for the current quarter do not include a non-controlling interest allocation to Citigroup following the completed acquisition of the wealth management joint venture, whereas Q3 2012 included a non-controlling interest allocation to Citi of $9 million.

Asset management fee revenues of $1.9 billion rose 6 per cent from last year’s third quarter, which the firm said reflects primarily an increase in fee-based assets and positive flows, partially offset by lower referral fees from Citi.

Compensation expense for the current quarter of $2 billion was “relatively unchanged from a year ago,” while non-compensation expenses of $796 million fell from $1.0 billion a year ago. The latter was driven primarily by the absence of non-recurring integration costs reported in the prior year quarter, and continued expense discipline, Morgan Stanley said in its latest earning release.

Meanwhile, total client assets were $1.8 trillion at end-September 2013, with assets in fee-based accounts of $652 billion increasing 22 per cent compared with the prior-year quarter.

The number of wealth management representatives increased from 16,378 as of September 30, 2012, to 16,517 at the end of Q3 2013.

Average annualized revenue per representative of $848,000, and total client assets per representative of $110 million, increased 8 and 7 per cent respectively over the year ended September 30, 2013.

Across the group, Morgan Stanley posted net revenues of $7.9 billion for the third quarter compared with $5.3 billion a year ago. For the current quarter, income from continuing operations was $888 million, compared with a loss of $1.0 billion in Q3 2012.