NEW YORK: Morgan Stanley’s annual revenue in Japan has hit a fresh record, beating peers as the Wall Street firm capitalised on a stock trading boom in the country.
Net revenue at the US bank’s majority-held local brokerage arm rose almost 10% in the year ended March to 168.3 billion yen (US$1.1bil), based on filings.
That topped rival JPMorgan Chase & Co, though the latter’s net income was higher, making it the country’s most profitable foreign investment bank for the second straight year.
Positive changes taking place in the Japanese economy, including policy actions and governance overhauls, have continued to provide “a significant tailwind” for the firm, said Alberto Tamura, president of Morgan Stanley MUFG Securities Co.
Equity trading volumes grew as overseas investors kept their focus on Japanese shares while the company’s tie-up with Mitsubishi UFJ Financial Group Inc contributed to an expansion in market share, Tamura added.
The venture’s net income also reached a record.
Almost every global lender posted higher revenue in the Asian nation as the stock market reached record highs on optimism over artificial intelligence and Japan’s economic changes, fuelling trading by clients.
Speculation over the cental bank’s monetary tightening has also sparked more bond trading, while a government-led push to improve corporate governance prompted a flurry of dealmaking.
At JPMorgan’s local securities unit, net revenue rose about 10% in the year ended March to 154.5 billion yen, partly due to stronger bond trading and merger advisory.
“Japan is a critical market for JPMorgan and we will continue to invest in our people and our platform to ensure we continue to meet the evolving needs,” a spokesperson said.
Meanwhile, BNP Paribas SA’s brokerage subsidiary saw its net revenue fall roughly 10% over the same period to 58.6 billion yen, the lowest in four years, as income from bond trading dropped. — Bloomberg
