Morgan Stanley Reports First Quarter 2013:

• Net Revenues of $8.2 Billion Included the Negative Impact of $317 Million from the Tightening of Morgan Stanley’s Debt-Related Credit Spreads (DVA); ¹ Income from Continuing Operations of $0.50 per Diluted Share
• Excluding DVA, Net Revenues were $8.5 Billion and Income from Continuing Operations was $0.61 per Diluted Share ^{2, 3}
• Global Wealth Management Pre-Tax Margin of 17% and Fee Based Asset Flows of $15.3 Billion; ^{4, 5, 6} Investment Banking Ranked #2 in Global Completed M&A and #3 in Global Equity ⁷

NEW YORK–(BUSINESS WIRE)– Morgan Stanley (NYS: MS) today reported net revenues of $8.2 billion for the first quarter ended March 31, 2013 compared with $6.9 billion a year ago. For the current quarter, income from continuing operations applicable to Morgan Stanley was $1.0 billion, or $0.50 per diluted share,⁸ compared with a loss of $79 million, or a loss of $0.05 per diluted share,⁸ for the same period a year ago.

Results for the current quarter included negative revenue related to changes in Morgan Stanley‘s debt-related credit spreads and other credit factors (Debt Valuation Adjustment, DVA)¹ of $317 million, compared with negative revenue of $2.0 billion a year ago.

Excluding DVA, net revenues for the current quarter were $8.5 billion compared with $8.9 billion a year ago and income from continuing operations applicable to Morgan Stanley was $1.2 billion, or $0.61 per diluted share, compared with income of $1.4 billion, or $0.71 per diluted share a year ago.^{3, 8, 9}

Compensation expense was $4.2 billion compared with $4.4 billion a year ago.¹⁰ Non-compensation expenses of $2.3 billion were essentially unchanged from a year ago.

For the current quarter, net income applicable to Morgan Stanley, including discontinued operations, was $0.49 per diluted share, compared with a net loss of $0.06 per diluted share in the first quarter of 2012.⁸