Morgan Stanley has today reported a fourth-quarter profit, compared with a year-earlier loss, as its legal costs plunged and compensation expenses fell.
The Wall Street bank said its total non-interest costs fell 41% in the quarter as it slashed headcount in its trading business.
"We enter 2016 with a continued focus on managing expenses across the firm and driving up returns for our shareholders," the bank's chief executive James Gorman said in a statement.
Compensation costs fell 28.5% to $3.65 billion, including $155m in severance charges.
Morgan Stanley had taken $2.9 billion in after-tax legal costs and a charge of $781m related to compensation adjustments in the year-earlier quarter.
Cost cuts and much smaller legal bills helped Citigroup and JPMorgan Chase & Co report a rise in quarterly profit last week.
Morgan Stanley said its trading revenue rose nearly 1% to $1.47 billion.
The bank reported earnings of $753m, or 39 cents per share, for the quarter ended December 31 compared with a loss of $1.75 billion, or 91 cents per share, a year earlier.
Excluding an accounting adjustment, the bank earned 43 cents per share.
Analysts on average had estimated earnings of 33 cents per share, according to Thomson Reuters.
