Morgan Stanley to Decrease Swiss Footprint

Stock Investment Lesson PainAnandKZ / Pixabay

Moving ahead with its strategy to shed non-core operations and improve efficiency, Morgan Stanley (NYSE:MS) is contemplating the divestiture or closure of its Swiss private banking unit – Bank Morgan Stanley AG. The discussion of the same was first revealed by Swiss financial news site

Morgan Stanley’s Swiss banking unit managed assets worth nearly $11.3 billion (CHF 10 billion) as of Dec 31, 2013. Further, the division employs around 130 people in Zurich and Geneva. Notably, the announcement for divestiture could come as early as the second quarter of 2014.

Morgan Stanley has been reviewing and realigning its business strategy to focus mainly on wealth management operations. Further, with the completion of its remaining stake buy in Morgan Stanley Wealth Management (MSWM) from Citigroup Inc. (C), the company’s dependence on volatile trading revenues has considerably reduced.

Additionally, in Europe and Asia, Morgan Stanley has decided to streamline its footprint, defer expansion plans and exit certain parts of its businesses.  All these are expected to drive earnings growth in the future.

Of late, Morgan Stanley is in the process of selling non-core/unprofitable units. In Dec 2013, the company announced the sale of Global Oil Merchanting Unit to a Russia-based Rosneft Oil Company. Further, the company is exploring strategic options for the sale of its stake in Transmontaigne Partners L.P. (TLP).

Additionally earlier that year, Morgan Stanley divested its wealth management divisions in Europe, the Middle East and Africa region to Credit Suisse Group AG (CS). However, the Swiss private banking unit was not the part of the deal at that time.

We believe that Morgan Stanley’s initiatives to vend non-core operations will aid in enhancing profitability.

Currently, Morgan Stanley carries a Zacks Rank #3 (Hold).

CITIGROUP INC (C): Free Stock Analysis Report

CREDIT SUISSE (CS): Free Stock Analysis Report

MORGAN STANLEY (MS): Free Stock Analysis Report

TRANSMONTN PTNR (TLP): Free Stock Analysis Report

To read this article on click here.

Zacks Investment Research

For exclusive info on hedge funds and the latest news from value investing world at only a few dollars a month check out ValueWalk Premium right here.

Multiple people interested? Check out our new corporate plan right here (We are currently offering a major discount)

About the Author

At the center of everything we do is a strong commitment to independent research and sharing its profitable discoveries with investors. This dedication to giving investors a trading advantage led to the creation of our proven Zacks Rank stock-rating system. Since 1986 it has nearly tripled the S&P 500 with an average gain of +26% per year. These returns cover a period from 1986-2011 and were audited and attested by Baker Tilly, an independent accounting firm.

Be the first to comment on "Morgan Stanley to Decrease Swiss Footprint"

Leave a comment