Friday, June 20, 2008

Morgan Stanley History

Since its founding in 1935, Morgan Stanley and its people have helped redefine the meaning of financial services. The firm has continually broken new ground in advising our clients on strategic transactions, in pioneering the global expansion of finance and capital markets, and in providing new opportunities for individual and institutional investors.

After J.P. Morgan & Co. chose to focus on retail banking after the Glass-Steagall Act disallowed corporations to hold investment banking and retail banking under a single holding group, J.P. Morgan employees Henry Morgan and Harold Stanley invested with the Drexel partners to form Morgan Stanley in 1935.

In 1935, Henry Morgan, Harold Stanley and others left JP Morgan & Co. and Drexel & Co. to form investment banking firm Morgan Stanley. In its first full year, the firm achieved 24% market share of public stock offerings. In 1941, Morgan Stanley joins the New York Stock Exchange and entered the brokerage business.

In 1967, a Paris division was opened to pursue the growing European securities market.

Since Mr. Gilbert took the helm in 1983, the number of employees has more than doubled, to about 6,800 from about 2,600. Its equity, which stood at $207 million in 1983, ballooned after it first issued stock to the public in 1986. It now has equity of more than $2 billion.

Mr. Gilbert, 56 years old, said that he had recommended that Richard B. Fisher, the 53-year-old president of Morgan Stanley, succeed him and that Robert F. Greenhill, also 53 and the vice chairman of the firm, succeed Mr. Fisher as president. Those recommendations are expected to be approved by the firm's board (May 18, 1990).

Mr. Gilbert has had an extremely close relationship with Morgan Stanley throughout his life, with ties that go back to the House of Morgan.

His father, S. Parker Gilbert, joined J. P. Morgan as a partner, but died in 1938. Years later, Mr. Gilbert's mother married Harold Stanley, a J. P. Morgan partner and a founder of Morgan Stanley.

Mr. Gilbert joined the firm in 1960 after graduation from Yale and service in Army intelligence.

Morgan Stanley merged with Dean Witter, Discover & Co. in 1997 to form a dominant force in securities and asset management.

The firm said it lost $3.59 billion, or $3.61 a share, during the fourth quarter 2007 - the first quarterly loss in Morgan Stanley's 72-year history. A year ago, Morgan Stanley posted a profit of $2.27 billion or $1.44 a share(December 20 2007).

Across Morgan Stanley's different businesses, hardest hit was the company's institutional securities division, which was the source of the fourth-quarter writedowns.

As part of its earnings announcement, Morgan Stanley said it would sell a $5 billion stake in the firm to the sovereign wealth fund China Investment Corporation, which will be worth 9.9 percent or less of Morgan Stanley's total shares outstanding.

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