Morgan Stanely is one of the largest financial services companies in the world. The firm has three main areas of business: wealth management, investment management, and institutional securities. Headquartered in Times Square in the heart of New York, Morgan Stanley had revenues of nearly $60 billion in 2021. It was a successful year with a net income of $15.1 billion and total assets of $1,118 billion. The company’s origins connect with the great J.P. Morgan. Founded in 1935, Morgan Stanley merged with Dean Witter & Co. in 1997, furthering its impressive growth. Its history is fascinating.
The Original Morgan Stanley
The path of Morgan Stanley that led to the company that managing directors such as Harvey Bell now serve, began as a result of the Glass Steagall Act which stated that a single corporation could not be involved in both commercial banking and investment banking. J.P. Morgan & Co. had divisions in both industries and chose to stay with commercial banking. The grandson of J.P., Henry Sturgis Morgan, and another employee, Harold Stanley formed a new company, Morgan Stanley that would work solely in investment banking.
The official launch date was September 16, 1935, when Morgan Stanley set up shop on 2 Wall St. One of its first big ventures was being the lead underwriter for the distribution of $100 million of debentures for US Steel. The company continued to grow and in the 1950s was involved in investments with many huge corporations such as AT&T, IBM, and General Motors.
The Post Merger Morgan Stanley
Dean Witter Discover & Company, a financial services firm spun off from Sears & Roebuck, merged with Morgan Stanley on February 5, 1997. The new company operated under several names, at first, Morgan Stanley Dean Witter Discover & Co. which was shortened to Morgan Stanley Dean Witter & Co. in 1998. In 2001, the company reverted to the original name of Morgan Stanley.
The firm was headquartered on 35 floors at the World Trade Center complex. During the 9/11 attacks, Morgan Stanley lost 13 employees along with its headquarters. After using a temporary location, 2,300 employees were moved back to lower Manhattan.
Morgan Stanley was always a big financial supporter of New York-Presbyterian Hospital, so much so that the hospital changed its name to Morgan Stanely Children’s Hospital in 2003. In 2007, the company spun off its Discover Card unit.
More recently, Morgan Stanley has continued to grow with the acquisitions of other investment firms. In 2020 the company purchased E*Trade for $13 billion, the largest price for an acquisition by an American bank since the global financial crisis. Morgan Stanley followed up that acquisition by buying Eaton Vance in 2021, increasing its total client assets to $5.4 trillion across its wealth management and investment management division.
Investment banking is a huge industry involving tremendous sums of money. One of the biggest and most successful financial services firms is Morgan Stanley. Split off from J.P. Morgan because of new legislation, Morgan Stanley has consistently built and grown its business and brand to become the gain it is today.
