Morgan Stanley posted net income of $1.54 billion for the quarter, a 40 per cent decrease from the previous quarter and a 17 per cent decrease from a year ago. Roughly $940 million of loan losses during the quarter contributed to the decline, while another $480 million of trading losses in quantitative strategies also reduced income. But the US bank's Global Wealth Management Group's pre-tax income for the third quarter was $287 million, a 78 per cent increase from $161 million in the third quarter of last year. The quarter's pre-tax margin was 17 per cent compared with 12 per cent in last year's third quarter. Net revenues of $1.7 billion were up 23 per cent from a year ago reflecting stronger transactional revenues including higher revenues from underwriting activity, higher asset management revenues resulting from growth in fee-based products and higher net interest revenue from growth in the bank deposit sweep programme. Non-interest expenses were $1.4 billion, up 15 per cent from a year ago and compensation costs increased from a year ago, primarily reflecting higher revenues and investment in the business. Total client assets were $734 billion, a 14 per cent increase from last year's third quarter. Client assets in fee-based accounts rose 15 per cent to $211 billion over the last 12 months and represent 29 per cent of total assets. The 8,341 global representatives at quarter-end achieved record average annualised revenue per global representative of $817,000 and near record total client assets per global representative of $88 million. Morgan Stanley’s asset management arm also reported a strong third quarter, although the overall group posted a drop in its net income from loan writedowns related to tightened credit markets. The bank reported $577 billion in assets under management for its financial quarter ended 31 August, a 3 per cent increase from the previous quarter and a 25 per cent increase from a year earlier. The increase came from solid net inflows during the quarter, said company officials, as well as market appreciation. For the quarter, Morgan Stanley’s asset management business had total net inflows of $20.8 billion, with institutional money market flows contributing about 60 per cent, or almost $13 billion, of the third-quarter increase. The inflows boosted Morgan Stanley’s money market assets under management to $103 billion; alternative assets increased 16 per cent while fixed income was flat during the quarter, and equity assets under management dropped 4 per cent. The declines resulted from market depreciation and client outflows.