The Chief Executive Officer of Morgan Stanley has outlined in a public statement that the company is aiming to generate about $4 billion in annual revenues from fixed income, currencies and commodities trading (FICC). Despite the industrywide decline in recent quarters, Morgan Stanley is setting up ambitions targets for its units.
The revenue flow of the firm from its FICC operations in the second part of 2015 has been deemed by senior management as “unacceptable”.
The ambitious goals of the company are yet another challenge for other banks in the industry that are looking to diversify their income flow amid ever declining interest rates which are hurting their core lending business and are focusing more on trading.
ATFX Institutional Business Continues to Expand: Adding a New Prime BrokerGo to article >>
The FICC business segment of Morgan Stanley underperformed in the first quarter of 2016
With the encouragement of risk taking global central banks are further challenging the health of a big list of financial institutions with the European banking system in particular disarray amid fears of Brexit. Financials traded across European stock markets have declined heavily in recent days with several indices closing in on recent lows.
According to Gorman, Mrogan Stanley has wrapped up the consolidation within its workforce in fixed income and has focused on generating revenues. Back in December the company stated that it is cutting 25 per cent of its fixed-income staff, which included 470 traders and salespeople.
On Tuesday the company also outlined that it is aiming to move 1,250 support staff to locations with lower costs. The FICC business segment of Morgan Stanley has grossly underperformed in the first quarter of 2016 with revenues declining 56 per cent to $873 million.