Morgan Stanley’s Wealth Unit Adds $232B in Net Assets

Morgan Stanley has posted record growth figures in client assets for the third quarter across its wealth management division, widely driven by assets flowing into initial public offerings. 

The investment bank’s wealth unit added $232 billion in net new assets, as IPOs continue to act as a strong contributor to the bank’s revenue, Chief Investment Officer Ted Pick said during the wealth unit’s quarterly media call. 

In the second quarter, the firm added $148 billion in net new assets, driven by clients tapping into the year’s biggest listings, SpaceX. SpaceX is known as being one of the bank’s prominent clients of its workplace channel, Morgan Stanley at Work.  

The channel provides employees with various benefits including equity compensation and retirement plans. 

“With an active IPO calendar, the pace of our funnel accelerates and client interest in advice increases,” Chief Financial Officer Sharon Yeshaya said on the earnings call for the quarter that ended on September 30. 

Morgan Stanley’s E*Trade also added $2 trillion in net assets.

Since the bank’s acquisition of E*Trade’s platform, Morgan Stanley has aimed to incorporate the platform’s clients into its workplace channel with the goal of ultimately introducing them to the unit’s financial advisors, Pick said. 

Roughly $100 billion in client assets have transitioned from Morgan Stanley’s workplace and E*Trade channels into advisors last year, as the need for personal financial advice continues to grow. 

Morgan Stanley’s wealth management unit reported a net revenue of $9.1 billion, up 10% from $8.2 billion year-over-year. Meanwhile, the unit’s net income jumped to $4.9 billion, up $4.6 billion year-over-year.