Of the big Wall Street banks, Morgan Stanley is something of an odd one out. It does not have a consumer bank and though it is a top investment bank, it has a smaller balance sheet than US-based universal banks. Also, it has not undergone a major restructuring since the financial crisis 10 years ago, unlike many of its rivals on both sides of the Atlantic. “Morgan Stanley has been able to stick to its knitting, which has been a big driver of our success,” says Tom Miles, head of Americas mergers and acquisitions (M&A).
Nevertheless, Morgan Stanley did not emerge unscathed from the credit crunch. In late 2008, Japanese mega-bank Mitsubishi UFJ Financial Group (MUFG) injected a much-needed $9bn in exchange for a 21% stake in the US lender. At the time, Morgan Stanley’s market cap had shrunk to $11bn, a far cry from today’s $76bn. Through its alliance with MUFG, Morgan Stanley was provided with access to a deep well of capital, giving it the required firepower to compete at the highest levels of investment banking.
