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| Morgan Stanley hit by big losses | Morgan Stanley hit by big losses |
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| US investment bank Morgan Stanley has reported a first-quarter loss of $177m (£121.9m), down from a profit of $1.4bn in the same quarter last year. | US investment bank Morgan Stanley has reported a first-quarter loss of $177m (£121.9m), down from a profit of $1.4bn in the same quarter last year. |
| The bank - hit by real estate and debt writedowns - cut its dividend to five cents a share from 27 cents. Revenues fell 62% from a year earlier to $3bn. | |
| Despite challenging markets, performance has improved, it said. | |
| Banks have been severely affected by the credit crisis and market turmoil, as well as exposure to bad debts. | Banks have been severely affected by the credit crisis and market turmoil, as well as exposure to bad debts. |
| "While challenging markets continued to impact our results this quarter, we saw improved performance across most of our businesses during the past three months," John Mack, its chief executive, said. | "While challenging markets continued to impact our results this quarter, we saw improved performance across most of our businesses during the past three months," John Mack, its chief executive, said. |
| "The firm delivered strong results in investment banking, commodities, interest rates and credit products as well as solid performance in global wealth management," he said. | |
| Morgan Stanley would have recorded a profit, he said, "if not for the dramatic improvement in our credit spreads - which is a significant positive development, but had a near-term negative impact on our revenues". | |
| The bank's shares fell 7.4% to $22.82 after the announcement. | |
| Reality check | |
| This is the bank's second quarterly loss and Carl Birkelbach, head of Birkelbach Management in Chicago, described it as a reality check. | |
| "We thought that fourth-quarter earnings were going to be where the chief executives throw in the kitchen sink to get everything out of the way. It now appears we have got one more quarter of it and I think that will affect stock prices," he said. | |
| Added David Dietze, president at Point View Financial Services: "Dividend cuts make sense in this environment... everyone else is doing it and you want to be safe rather than sorry." |