Goldman and Morgan Stanley look beyond trading to drive profit
New York — Wall Street rivals Goldman Sachs Group and Morgan Stanley topped analyst expectations on Tuesday, reporting third-quarter earnings gains from a range of products and services despite an industry-wide decline in bond trading. Goldman’s private equity investments helped fuel its earnings beat, while Morgan Stanley’s wealth management unit delivered record revenue and profit margins. Both reported higher investment banking revenue than the year-ago period and kept a lid on expenses relative to revenue. Executives at the biggest banks have argued that diverse business lines can offset temporary weakness in one area and that controlling costs can further pad the bottom line. "This is the goal: that we’re not as reliant on sales and trading businesses," Morgan Stanley Chief Financial Officer Jonathan Pruzan said. "In a subdued trading environment we can maintain our (market) share, yet when the market flexes up, we have capacity to participate in this growth." Shares of Morgan ...
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