Morgan Stanley has reported a sharp increase in second-quarter profit, driven by strong mergers and acquisitions activity that boosted investment banking revenue despite an uncertain global economic environment.
The Wall Street lender said a more accommodative regulatory environment and resilient equity markets encouraged companies across industries to pursue major strategic transactions, resulting in significantly higher advisory fees.
Global mergers and acquisitions accelerated during the first half of the year, with announced deals reaching approximately $2.8 trillion, a 48% increase from the same period last year and the highest first-half total since records began in 1980.
Among the quarter’s notable transactions, Morgan Stanley served as financial adviser to Fertitta Entertainment on its $17.6 billion acquisition of Caesars Entertainment, one of the largest deals announced during the period.
The bank also strengthened its position in the capital markets, acting as a lead underwriter for Elon Musk’s record-breaking $2 trillion SpaceX initial public offering, widely viewed as a landmark transaction in the revival of the US IPO market.
In addition, Morgan Stanley was a lead underwriter on Cerebras’ New York initial public offering and served as a joint book-running manager on Alphabet’s equity capital raise announced last month.
Other major US lenders, including JPMorgan Chase, Bank of America and Goldman Sachs, which also participated in the underwriting syndicate for the SpaceX IPO, likewise reported stronger investment banking performance.
Morgan Stanley’s investment banking revenue rose to $2.44 billion in the second quarter, up from $1.54 billion a year earlier, supported by a substantial increase in merger and acquisition advisory fees.
Net income attributable to the bank climbed to $5.58 billion, or $3.46 per share, for the three months ended June 30, compared with $3.54 billion, or $2.13 per share, in the same period last year.
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