Net revenue rose to $3.07 billion, up from $1.923 billion a year before, the firm said in a statement.

However, Morgan Stanley said comparisons of the quarter’s results with prior periods were affected by the results of Morgan Stanley Smith Barney – the joint venture deal which closed on 31 May. The quarter’s pre-tax margin was 7 per cent, the firm said.

Income after the non-controlling interest allocation to Citigroup and before taxes was $171 million.

Net revenues were $3.1 billion compared with $1.9 billion a year ago. The increase primarily reflected incremental net revenues, following the closing of the MSSB transaction, which were partly offset by the effect of weaker market conditions. 

Compensation expenses of $2.0 billion increased from $1.4 billion a year ago due to the inclusion of MSSB for the full quarter. The compensation to net revenue ratio for the current quarter was 64 per cent compared with 71 per cent a year ago. Non-compensation expenses of $901 million increased from $632 million a year ago primarily due to the inclusion of MSSB. 

Total client assets were $1.5 trillion at quarter-end. Client assets in fee-based accounts were $396 billion and represented 26 per cent of total client assets, the firm said. The 18,087 global representatives at quarter-end achieved average annualized revenue per global representative of $679,000 and total client assets per global representative of $83 million.

Meanwhile, across Morgan Stanley as a whole, it reported income of $1.4 billion, or $0.80 per diluted share, from continuing operations for the quarter ended 30 June, compared with a loss of $138 million, or $1.36 per diluted share, for the same period a year ago.

Within the asset management division, assets under management or supervision stood at $251 billion at the end of June, up from $242 billion a year ago.