Morgan Stanley profit beats as wealth business cushions deals slump

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Morgan Stanley's first-quarter profit beat expectations as rising revenue from its wealth management division offset declines in its investment banking and trading units.

Shares, however, fell more than 3% at $86.81 in premarket trading on Wednesday as investment banking revenue fell 24% to $1.25 billion and the bank set aside $234 million in the quarter to cover bad loans.

Revenue in the wealth management unit jumped 11%, bringing in $110 billion in net new assets, of which only about $20 billion came from regional banks in response to the March banking crisis. The downswing in investment banking activity for Morgan Stanley, which forms the core of the bank's business, dragged total revenue down nearly 2% to $14.5 billion in the quarter.

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Morgan Stanley earnings call in progress. $MS shares down 4% pre-market. Q&A asking about CRE and construction loan exposure.

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