Morgan Stanley 8K Reports Full-Year and Fourth Quarter Results | MS 20 Jan 10

MORGAN STANLEY

Financial Supplement - 4Q 2009

Table of Contents

MORGAN STANLEY
Quarterly Financial Summary
(unaudited, dollars in millions)



	Quarter Ended (1)																								Percentage Change From:						Twelve Months Ended (1)
	Mar 31, 2008			June 30, 2008			Sept 30, 2008			Dec 31, 2008			Mar 31, 2009			June 30, 2009			Sept 30, 2009			Dec 31, 2009			4Q09 vs. 4Q08			4Q09 vs. 3Q09			Dec 31, 2008			Dec 31, 2009			Percentage Change
Net revenues
Institutional Securities (2)	$	4,951		$	3,876		$	16,043		$	(13,789	)	$	1,600		$	2,965		$	4,975		$	3,237			123	%		(35	%)	$	11,081		$	12,777			15	%
Global Wealth Management Group		2,333			1,695			1,582			1,277			1,299			1,923			3,029			3,139			146	%		4	%		6,887			9,390			36	%
Asset Management		360			315			226			(438	)		22			358			447			510			*			14	%		463			1,337			189	%
Intersegment Eliminations		(41	)		(41	)		(63	)		(50	)		(25	)		(51	)		(26	)		(44	)		12	%		(69	%)		(195	)		(146	)		25	%
Consolidated net revenues	$	7,603		$	5,845		$	17,788		$	(13,000	)	$	2,896		$	5,195		$	8,425		$	6,842			153	%		(19	%)	$	18,236		$	23,358			28	%

Income / (loss) applicable to Morgan Stanley (3)
Institutional Securities	$	872		$	650		$	7,899		$	(10,079	)	$	159		$	(125	)	$	858		$	387			104	%		(55	%)	$	(658	)	$	1,279			*
Global Wealth Management Group		593			172			12			(54	)		73			76			105			29			154	%		(72	%)		723			283			(61	%)
Asset Management		(101	)		(186	)		(178	)		(395	)		(250	)		(89	)		(66	)		0			*			*			(860	)		(405	)		53	%
Intersegment Eliminations		(5	)		(1	)		(5	)		(1	)		(1	)		(3	)		(1	)		(3	)		(200	%)		(200	%)		(12	)		(8	)		33	%
Consolidated income / (loss) applicable to Morgan Stanley	$	1,359		$	635		$	7,728		$	(10,529	)	$	(19	)	$	(141	)	$	896		$	413			104	%		(54	%)	$	(807	)	$	1,149			*
Earnings / (loss) applicable to Morgan Stanley common shareholders (4)	$	1,311		$	1,062		$	7,684		$	(11,348	)	$	(578	)	$	(1,256	)	$	498		$	376			103	%		(24	%)	$	(731	)	$	(907	)		(24	%)

Earnings per basic share: (5)
Income from continuing operations	$	1.22		$	0.56		$	7.00		$	(10.92	)	$	(0.41	)	$	(1.36	)	$	0.48		$	0.14			101	%		(71	%)	$	(1.26	)	$	(0.93	)		26	%
Discontinued operations (6)	$	0.05		$	0.46		$	0.38		$	(0.43	)	$	(0.16	)	$	0.26		$	(0.09	)	$	0.15			135	%		*		$	0.55		$	0.17			(69	%)
Earnings per basic share	$	1.27		$	1.02		$	7.38		$	(11.35	)	$	(0.57	)	$	(1.10	)	$	0.39		$	0.29			103	%		(26	%)	$	(0.71	)	$	(0.76	)		(7	%)

Earnings per diluted share: (5)
Income from continuing operations	$	1.21		$	0.56		$	6.99		$	(10.92	)	$	(0.41	)	$	(1.36	)	$	0.48		$	0.14			101	%		(71	%)	$	(1.26	)	$	(0.93	)		26	%
Discontinued operations (6)	$	0.05		$	0.46		$	0.39		$	(0.43	)	$	(0.16	)	$	0.26		$	(0.10	)	$	0.15			135	%		*		$	0.55		$	0.17			(69	%)
Earnings per diluted share	$	1.26		$	1.02		$	7.38		$	(11.35	)	$	(0.57	)	$	(1.10	)	$	0.38		$	0.29			103	%		(24	%)	$	(0.71	)	$	(0.76	)		(7	%)

Return on average common equity
from continuing operations		16.9	%		7.5	%		*			*			*			*			7.4	%		2.1	%								*			*
Return on average common equity		17.6	%		13.6	%		*			*			*			*			5.8	%		4.3	%								*			*


Note: Refer to End Notes on pages 16 - 21 and Legal Notice on page 22.

MORGAN STANLEY
Quarterly Consolidated Income Statement Information
(unaudited, dollars in millions)


	Quarter Ended (1)																								Percentage Change From:						Twelve Months Ended (1)
	Mar 31, 2008			June 30, 2008			Sept 30, 2008			Dec 31, 2008			Mar 31, 2009			June 30, 2009			Sept 30, 2009			Dec 31, 2009			4Q09 vs. 4Q08			4Q09 vs. 3Q09			Dec 31, 2008			Dec 31, 2009			Percentage Change
Revenues:
Investment banking	$	960		$	1,278		$	1,018		$	643		$	873		$	1,264		$	1,209		$	1,673			160	%		38	%	$	3,899		$	5,019			29	%
Principal transactions:
Trading		2,798			2,095			13,184			(15,420	)		1,095			1,978			3,244			1,130			107	%		(65	%)		2,657			7,447			180	%
Investments		(482	)		(323	)		(666	)		(2,676	)		(1,152	)		(126	)		92			132			105	%		43	%		(4,147	)		(1,054	)		75	%
Commissions		1,261			1,112			1,105			856			770			973			1,244			1,247			46	%		--			4,334			4,234			(2	%)
Asset management, distribution and admin. fees		1,237			1,262			1,185			990			866			1,158			1,886			1,974			99	%		5	%		4,674			5,884			26	%
Other		904			274			1,112			1,628			247			391			126			74			(95	%)		(41	%)		3,918			838			(79	%)
Total non-interest revenues		6,678			5,698			16,938			(13,979	)		2,699			5,638			7,801			6,230			145	%		(20	%)		15,335			22,368			46	%

Interest and dividends		12,709			9,192			9,625			5,155			2,522			1,391			1,987			1,802			(65	%)		(9	%)		36,681			7,702			(79	%)
Interest expense		11,784			9,045			8,775			4,176			2,325			1,834			1,363			1,190			(72	%)		(13	%)		33,780			6,712			(80	%)
Net interest		925			147			850			979			197			(443	)		624			612			(37	%)		(2	%)		2,901			990			(66	%)
Net revenues		7,603			5,845			17,788			(13,000	)		2,896			5,195			8,425			6,842			153	%		(19	%)		18,236			23,358			28	%

Non-interest expenses:
Compensation and benefits		3,740			3,037			4,990			(715	)		1,979			3,804			4,898			3,757			*			(23	%)		11,052			14,438			31	%

Non-compensation expenses:
Occupancy and equipment		287			324			314			434			337			373			422			419			(3	%)		(1	%)		1,359			1,551			14	%
Brokerage, clearing and exchange fees		422			381			356			310			248			267			285			390			26	%		37	%		1,469			1,190			(19	%)
Information processing and communications		301			296			293			304			282			313			356			421			38	%		18	%		1,194			1,372			15	%
Marketing and business development		183			182			156			180			110			120			119			154			(14	%)		29	%		701			503			(28	%)
Professional services		348			475			376			496			303			385			382			533			7	%		40	%		1,695			1,603			(5	%)
Other		375			355			583			1,248			271			522			521			530			(58	%)		2	%		2,561			1,844			(28	%)
Total non-compensation expenses		1,916			2,013			2,078			2,972			1,551			1,980			2,085			2,447			(18	%)		17	%		8,979			8,063			(10	%)

Total non-interest expenses		5,656			5,050			7,068			2,257			3,530			5,784			6,983			6,204			175	%		(11	%)		20,031			22,501			12	%

Income / (loss) from continuing operations before taxes		1,947			795			10,720			(15,257	)		(634	)		(589	)		1,442			638			104	%		(56	%)		(1,795	)		857			148	%
Income tax provision / (benefit) from continuing operations		573			155			2,985			(4,731	)		(597	)		(321	)		510			72			102	%		(86	%)		(1,018	)		(336	)		67	%
Income / (loss) from continuing operations		1,374			640			7,735			(10,526	)		(37	)		(268	)		932			566			105	%		(39	%)		(777	)		1,193			*
Gain / (loss) from discontinued operations after tax (2)		58			519			436			(412	)		(153	)		301			(139	)		204			150	%		*			601			213			(65	%)
Net income / (loss)	$	1,432		$	1,159		$	8,171		$	(10,938	)	$	(190	)	$	33		$	793		$	770			107	%		(3	%)	$	(176	)	$	1,406			*
Net income / (loss) applicable to non-controlling interests (3)		19			16			20			15			(13	)		(116	)		36			153			*			*			70			60			(14	%)
Net income / (loss) applicable to Morgan Stanley		1,413			1,143			8,151			(10,953	)		(177	)		149			757			617			106	%		(18	%)		(246	)		1,346			*
Earnings / (loss) applicable to Morgan Stanley common shareholders	$	1,311		$	1,062		$	7,684		$	(11,348	)	$	(578	)	$	(1,256	)	$	498		$	376			103	%		(24	%)	$	(731	)	$	(907	)		(24	%)

Amounts applicable to Morgan Stanley:
Income / (loss) from continuing operations		1,359			635			7,728			(10,529	)		(19	)		(141	)		896			413			104	%		(54	%)		(807	)		1,149			*
Gain / (loss) from discontinued operations after tax (2)		54			508			423			(424	)		(158	)		290			(139	)		204			148	%		*			561			197			(65	%)
Net income / (loss) applicable to Morgan Stanley	$	1,413		$	1,143		$	8,151		$	(10,953	)	$	(177	)	$	149		$	757		$	617			106	%		(18	%)	$	(246	)	$	1,346			*

Pre-tax profit margin		26	%		14	%		60	%		*			*			*			17	%		9	%								*			4	%
Compensation and benefits as a % of net revenues		49	%		52	%		28	%		*			68	%		73	%		58	%		55	%								61	%		62	%
Non-compensation expenses as a % of net revenues		25	%		34	%		12	%		*			54	%		38	%		25	%		36	%								49	%		35	%
Effective tax rate from continuing operations (4)		29.4	%		19.5	%		27.8	%		31.0	%		94.2	%		54.5	%		35.4	%		11.3	%								56.7	%		*

Note: Refer to End Notes on pages 16 - 21 and Legal Notice on page 22.

MORGAN STANLEY
Quarterly Consolidated Financial Information and Statistical Data (1)
(unaudited)


	Quarter Ended (2)																								Percentage Change From:						Twelve Months Ended (2)
	Mar 31, 2008			June 30, 2008			Sept 30, 2008			Dec 31, 2008			Mar 31, 2009			June 30, 2009			Sept 30, 2009			Dec 31, 2009			4Q09 vs. 4Q08			4Q09 vs. 3Q09			Dec 31, 2008		Dec 31, 2009		Percentage Change
Morgan Stanley

Regional revenue (3)
Americas	$	2,286		$	3,581		$	8,148		$	(5,776	)	$	2,588		$	4,522		$	6,141		$	5,653			198	%		(8	%)	$	8,239	$	18,904		129	%
EMEA (Europe, Middle East, Africa)		4,114			1,340			8,406			(5,941	)		59			7			1,618			775			113	%		(52	%)		7,919		2,459		(69	%)
Asia		1,203			924			1,234			(1,283	)		249			666			666			414			132	%		(38	%)		2,078		1,995		(4	%)
Consolidated net revenues	$	7,603		$	5,845		$	17,788		$	(13,000	)	$	2,896		$	5,195		$	8,425		$	6,842			153	%		(19	%)	$	18,236	$	23,358		28	%

Worldwide employees (4)		46,048			45,696			45,917			45,295			43,317			61,841			61,632			61,388			36	%		--
Total assets	$	1,131,649		$	1,097,770		$	943,026		$	676,764		$	626,023		$	676,957		$	769,503		$	773,420			14	%		1	%
Firmwide Deposits		35,881			35,274			34,380			51,355			59,922			62,382			62,415			62,215			21	%		--

Common equity		32,877			34,153			40,492			29,585			29,314			36,989			36,752			37,091			25	%		1	%
Preferred equity		1,100			1,100			1,100			19,168			19,208			9,597			9,597			9,597			(50	%)		--
Morgan Stanley shareholders' equity (5)		33,977			35,253			41,592			48,753			48,522			46,586			46,349			46,688			(4	%)		1	%
Junior subordinated debt issued to capital trusts		10,491			10,389			9,753			10,312			10,436			10,666			10,701			10,594			3	%		(1	%)
Less: Goodwill and intangible assets (6)		(3,665	)		(3,571	)		(3,738	)		(2,978	)		(2,915	)		(7,726	)		(7,902	)		(7,612	)		(156	%)		4	%
Tangible Morgan Stanley shareholders' equity (7)	$	40,803		$	42,071		$	47,607		$	56,087		$	56,043		$	49,526		$	49,148		$	49,670			(11	%)		1	%
Tangible common equity (8)	$	29,212		$	30,582		$	36,754		$	26,607		$	26,399		$	29,263		$	28,850		$	29,479			11	%		2	%
Leverage Ratio (9)		27.7	x		26.1	x		19.8	x		12.1	x		11.2	x		13.7	x		15.7	x		15.6	x
Aggregate trading and non-trading Value-at-Risk (pre-tax) (10)	$	105		$	116		$	126		$	129		$	142		$	154		$	168		$	187

Average common shares outstanding
Basic		1,034,342,428			1,041,178,821			1,040,887,906			1,000,194,024			1,011,741,210			1,138,444,490			1,294,298,229			1,297,175,553
Diluted		1,039,026,879			1,044,720,912			1,041,677,018			1,000,194,024			1,011,741,210			1,138,444,490			1,300,070,107			1,297,175,714
Period end common shares outstanding		1,107,158,003			1,109,013,816			1,061,983,111			1,074,497,565			1,081,607,788			1,359,204,010			1,358,900,574			1,360,595,214

Book value per common share (11)	$	29.70		$	30.80		$	38.13		$	27.53		$	27.10		$	27.21		$	27.05		$	27.26			(1	%)		1	%
Tangible Book value per common share (12)	$	26.39		$	27.58		$	34.61		$	24.76		$	24.41		$	21.53		$	21.23		$	21.67			(13	%)		2	%


Note: Refer to End Notes on pages 16 - 21 and Legal Notice on page 22.

MORGAN STANLEY
Quarterly Consolidated Financial Information and Statistical Data
(unaudited)


	Quarter Ended																								Twelve Months Ended
	Mar 31, 2009						June 30, 2009 (1)						Sept 30, 2009 (1)						Dec 31, 2009 (1)						Dec 31, 2009 (1)
	Average tier 1 equity (billions)(2)		Average common equity (billions)(2)		Return on average common equity		Average tier 1 equity (billions)(2)		Average common equity (billions)(2)		Return on average common equity		Average tier 1 equity (billions)(2)		Average common equity (billions)(2)		Return on average common equity		Average tier 1 equity (billions)(2)		Average common equity (billions)(2)		Return on average common equity		Average tier 1 equity (billions)(2)		Average common equity (billions)(2)		Return on average common equity
Institutional Securities	$	23.6	$	20.3		2%	$	22.6	$	18.2		*	$	23.2	$	16.7		19%	$	24.9	$	17.0		7%	$	23.6	$	18.1		5%

Global Wealth Management Group		1.8		1.3		20%		2.4		3.4		7%		3.4		7.4		5%		3.4		7.3		1%		2.7		4.6		5%

Asset Management		2.5		2.4		*		2.2		2.3		*		2.1		2.0		*		3.0		2.0		*		2.5		2.2		*

Unallocated capital		19.3		4.2				22.3		7.9				15.9		9.7				14.8		9.8				18.3		8.1

Total - continuing operations		47.2		28.2		*		49.5		31.8		*		44.6		35.8		7%		46.1		36.1		2%		47.1		33.0		*

Discontinued operations (3)		0.9		1.4				0.7		1.1				0.6		0.9				0.5		0.7				0.7		1.1

Firm	$	48.1	$	29.6		*	$	50.2	$	32.9		*	$	45.2	$	36.7		6%	$	46.6	$	36.8		4%	$	47.8	$	34.1		*


	Quarter Ended																								Twelve Months Ended
	Mar 31, 2008						June 30, 2008						Sept 30, 2008						Dec 31, 2008						Dec 31, 2008
	Average tier 1 equity (billions) (2)		Average common equity (billions) (2)		Return on average common equity		Average tier 1 equity (billions) (2)		Average common equity (billions)(2)		Return on average common equity		Average tier 1 equity (billions)(2)		Average common equity (billions)(2)		Return on average common equity		Average tier 1 equity (billions)(2)		Average common equity (billions)(2)		Return on average common equity		Average tier 1 equity (billions)(2)		Average common equity (billions)(2)		Return on average common equity
Institutional Securities	$	27.7	$	23.8		14%	$	26.0	$	22.3		11%	$	24.2	$	22.7		*	$	23.8	$	22.1		*	$	25.4	$	22.5		*

Global Wealth Management Group		1.6		1.4		*		1.7		1.4		48%		1.8		1.5		3%		1.9		1.4		*		1.7		1.5		49%

Asset Management		2.9		3.0		*		2.8		2.9		*		3.0		3.0		*		2.8		2.7		*		2.9		2.9		*

Unallocated capital		2.5		2.5				5.5		5.5				7.4		7.4				18.4		6.7				8.2		5.2

Total - continuing operations		34.7		30.7		17%		36.0		32.1		7%		36.4		34.6		*		46.9		32.9		*		38.2		32.1		*

Discontinued operations (3)		0.4		1.2				0.7		1.2				1.3		1.5				1.0		1.3				0.8		1.3

Firm	$	35.1	$	31.9		18%	$	36.7	$	33.3		14%	$	37.7	$	36.1		*	$	47.9	$	34.2		*	$	39.0	$	33.4		*



Note: Refer to End Notes on pages 16 - 21 and Legal Notice on page 22.

MORGAN STANLEY
Quarterly Institutional Securities Income Statement Information
(unaudited, dollars in millions)


	Quarter Ended (1)																								Percentage Change From:						Twelve Months Ended
	Mar 31, 2008			June 30, 2008			Sept 30, 2008			Dec 31, 2008			Mar 31, 2009			June 30, 2009			Sept 30, 2009			Dec 31, 2009			4Q09 vs. 4Q08			4Q09 vs. 3Q09			Dec 31, 2008			Dec 31, 2009			Percentage Change
Revenues:
Investment banking	$	842		$	1,096		$	936		$	612		$	811		$	1,124		$	1,039		$	1,480			142	%		42	%	$	3,486		$	4,454			28	%
Principal transactions:
Trading		2,669			2,005			12,978			(15,309	)		846			1,766			2,921			782			105	%		(73	%)		2,343			6,315			170	%
Investments		(272	)		(145	)		(389	)		(1,854	)		(791	)		(184	)		39			61			103	%		56	%		(2,660	)		(875	)		67	%
Commissions		916			772			786			540			512			565			533			543			1	%		2	%		3,014			2,153			(29	%)
Asset management, distribution and admin. fees		34			34			33			46			25			20			30			24			(48	%)		(20	%)		147			99			(33	%)
Other		55			197			1,078			1,449			186			312			61			(13	)		(101	%)		(121	%)		2,779			546			(80	%)
Total non-interest revenues		4,244			3,959			15,422			(14,516	)		1,589			3,603			4,623			2,877			120	%		(38	%)		9,109			12,692			39	%
Interest and dividends		12,421			8,870			9,259			4,821			2,295			1,129			1,661			1,503			(69	%)		(10	%)		35,371			6,588			(81	%)
Interest expense		11,714			8,953			8,638			4,094			2,284			1,767			1,309			1,143			(72	%)		(13	%)		33,399			6,503			(81	%)
Net interest		707			(83	)		621			727			11			(638	)		352			360			(50	%)		2	%		1,972			85			(96	%)
Net revenues		4,951			3,876			16,043			(13,789	)		1,600			2,965			4,975			3,237			123	%		(35	%)		11,081			12,777			15	%

Compensation and benefits		2,423			1,650			3,772			(1,436	)		1,041			2,110			2,584			1,481			*			(43	%)		6,409			7,216			13	%
Non-compensation expenses		1,366			1,382			1,280			2,155			1,027			1,158			1,102			1,292			(40	%)		17	%		6,183			4,579			(26	%)
Total non-interest expenses		3,789			3,032			5,052			719			2,068			3,268			3,686			2,773			*			(25	%)		12,592			11,795			(6	%)


Income / (loss) from continuing operations before taxes		1,162			844			10,991			(14,508	)		(468	)		(303	)		1,289			464			103	%		(64	%)		(1,511	)		982			165	%
Income tax provision / (benefit) from continuing operations		275			189			3,085			(4,432	)		(609	)		(170	)		416			70			102	%		(83	%)		(883	)		(293	)		67	%
Income / (loss) from continuing operations		887			655			7,906			(10,076	)		141			(133	)		873			394			104	%		(55	%)		(628	)		1,275			*
Gain / (loss) from discontinued operations after tax (2)		22			466			465			13			13			318			(1	)		(49	)		*			*			966			281			(71	%)
Net income / (loss)		909			1,121			8,371			(10,063	)		154			185			872			345			103	%		(60	%)		338			1,556			*
Net income / (loss) applicable to non-controlling interests		19			16			20			15			(13	)		3			15			7			(53	%)		(53	%)		70			12			(83	%)
Net income / (loss) applicable to Morgan Stanley	$	890		$	1,105		$	8,351		$	(10,078	)	$	167		$	182		$	857		$	338			103	%		(61	%)	$	268		$	1,544			*

Amounts applicable to Morgan Stanley:
Income / (loss) from continuing operations		872			650			7,899			(10,079	)		159			(125	)		858			387			104	%		(55	%)		(658	)		1,279			*
Gain / (loss) from discontinued operations after tax (2)		18			455			452			1			8			307			(1	)		(49	)		*			*			926			265			(71	%)
Net income / (loss) applicable to Morgan Stanley	$	890		$	1,105		$	8,351		$	(10,078	)	$	167		$	182		$	857		$	338			103	%		(61	%)	$	268		$	1,544			*

Return on average common equity from continuing operations (3)		14	%		11	%		*			*			2	%		*			19	%		7	%								*			5	%
Pre-tax profit margin (4)		24	%		22	%		69	%		*			*			*			26	%		14	%								*			8	%
Compensation and benefits as a % of net revenues		49	%		43	%		24	%		*			65	%		71	%		52	%		46	%								58	%		57	%



Note: Refer to End Notes on pages 16 - 21 and Legal Notice on page 22.

MORGAN STANLEY
Quarterly Financial Information and Statistical Data
Institutional Securities
(unaudited, dollars in millions)



	Quarter Ended																					Percentage Change From:						Twelve Months Ended
	Mar 31, 2008			June 30, 2008			Sept 30, 2008			Dec 31, 2008			Mar 31, 2009			June 30, 2009		Sept 30, 2009		Dec 31, 2009		4Q09 vs. 4Q08			4Q09 vs. 3Q09			Dec 31, 2008			Dec 31, 2009			Percentage Change

Investment Banking
Advisory revenue	$	401		$	380		$	500		$	367		$	411		$	268	$	279	$	530		44	%		90	%	$	1,648		$	1,488			(10	%)
Underwriting revenue (1)
Equity		191			460			193			136			155			455		457		627		*			37	%		980			1,694			73	%
Fixed income		250			256			243			109			245			401		303		323		196	%		7	%		858			1,272			48	%
Total underwriting revenue	$	441		$	716		$	436		$	245		$	400		$	856	$	760	$	950		*			25	%	$	1,838		$	2,966			61	%

Total investment banking revenue	$	842		$	1,096		$	936		$	612		$	811		$	1,124	$	1,039	$	1,480		142	%		42	%	$	3,486		$	4,454			28	%
																																	��
Sales & Trading (2)
Equity	$	3,414		$	2,228		$	6,031		$	(2,648	)	$	877		$	681	$	1,073	$	722		127	%		(33	%)	$	9,025		$	3,353			(63	%)
Fixed income		2,422			678			8,847			(9,910	)		1,294			973		2,064		686		107	%		(67	%)		2,037			5,017			146	%
Other		(1,544	)		(212	)		(493	)		(1,484	)		(802	)		39		669		277		119	%		(59	%)		(3,733	)		183			105	%
Total sales & trading net revenue	$	4,292		$	2,694		$	14,385		$	(14,042	)	$	1,369		$	1,693	$	3,806	$	1,685		112	%		(56	%)	$	7,329		$	8,553			17	%


Average Daily 95%/One-Day Value-at-Risk ("VaR") (3)
Primary Market Risk Category ($ millions, pre-tax)
Interest rate and credit spread	$	65		$	64		$	71		$	95		$	107		$	103	$	103	$	108
Equity price	$	36		$	41		$	35		$	23		$	19		$	19	$	19	$	25
Foreign exchange rate	$	29		$	25		$	23		$	17		$	12		$	17	$	22	$	28
Commodity price	$	39		$	38		$	33		$	27		$	26		$	23	$	25	$	23

Trading VaR	$	99		$	100		$	96		$	105		$	115		$	113	$	118	$	132



Note: Refer to End Notes on pages 16 - 21 and Legal Notice on page 22.

MORGAN STANLEY
Quarterly Financial Information and Statistical Data
Institutional Securities - Corporate Lending (1)
(unaudited, dollars in billions)

	Quarter Ended																								Percentage Change From:
	Mar 31, 2008			June 30, 2008			Sept 30, 2008			Dec 31, 2008			Mar 31, 2009			June 30, 2009			Sept 30, 2009			Dec 31, 2009			4Q09 vs. 4Q08			4Q09 vs. 3Q09


Corporate funded loans
Investment grade	$	14.7		$	10.6		$	9.2		$	7.4		$	7.1		$	7.2		$	6.7		$	6.5			(12	%)		(3	%)
Non-investment grade		10.2			8.4			11.2			9.4			9.7			10.2			10.5			9.6			2	%		(9	%)
Total corporate funded loans	$	24.9		$	19.0		$	20.4		$	16.8		$	16.8		$	17.4		$	17.2		$	16.1			(4	%)		(6	%)

Corporate lending commitments
Investment grade	$	43.4		$	41.6		$	37.3		$	36.9		$	34.9		$	35.7		$	36.9		$	40.7			10	%		10	%
Non-investment grade		14.9			13.3			8.0			7.0			5.9			6.0			8.0			7.2			3	%		(10	%)
Total corporate lending commitments	$	58.3		$	54.9		$	45.3		$	43.9		$	40.8		$	41.7		$	44.9		$	47.9			9	%		7	%

Corporate funded loans plus lending commitments
Investment grade	$	58.1		$	52.2		$	46.5		$	44.3		$	42.0		$	42.9		$	43.6		$	47.2			7	%		8	%
Non-investment grade (2)	$	25.1		$	21.7		$	19.2		$	16.4		$	15.6		$	16.2		$	18.5		$	16.8			2	%		(9	%)

% investment grade		70	%		71	%		71	%		73	%		73	%		73	%		70	%		74	%
% non-investment grade		30	%		29	%		29	%		27	%		27	%		27	%		30	%		26	%

Total corporate funded loans and lending commitments	$	83.2		$	73.9		$	65.7		$	60.7		$	57.6		$	59.1		$	62.1		$	64.0			5	%		3	%
Hedges (3)	$	33.3		$	29.3		$	31.5		$	35.7		$	34.1		$	31.8		$	29.1		$	25.8			(28	%)		(11	%)


Note: Refer to End Notes on pages 16 - 21 and Legal Notice on page 22.

MORGAN STANLEY
Quarterly Global Wealth Management Group Income Statement Information
(unaudited, dollars in millions)


	Quarter Ended (1)																								Percentage Change From:						Twelve Months Ended (1)
	Mar 31, 2008			June 30, 2008			Sept 30, 2008			Dec 31, 2008			Mar 31, 2009			June 30, 2009			Sept 30, 2009			Dec 31, 2009			4Q09 vs. 4Q08			4Q09 vs. 3Q09			Dec 31, 2008			Dec 31, 2009			Percentage Change
Revenues:
Investment banking	$	110		$	159		$	82		$	67		$	61		$	165		$	168		$	202			*			20	%	$	418		$	596			43	%
Principal transactions:
Trading		189			195			186			47			246			303			346			314			*			(9	%)		617			1,209			96	%
Investments		(5	)		(1	)		(16	)		(36	)		(14	)		1			10			6			117	%		(40	%)		(58	)		3			105	%
Commissions		355			348			342			334			262			412			709			707			112	%		--			1,379			2,090			52	%
Asset management, distribution and admin. fees		691			684			690			586			511			816			1,574			1,682			187	%		7	%		2,651			4,583			73	%
Other		775			67			34			93			46			66			54			82			(12	%)		52	%		969			248			(74	%)
Total non-interest revenues		2,115			1,452			1,318			1,091			1,112			1,763			2,861			2,993			174	%		5	%		5,976			8,729			46	%

Interest and dividends		294			321			343			237			226			265			327			296			25	%		(9	%)		1,195			1,114			(7	%)
Interest expense		76			78			79			51			39			105			159			150			194	%		(6	%)		284			453			60	%
Net interest		218			243			264			186			187			160			168			146			(22	%)		(13	%)		911			661			(27	%)
Net revenues		2,333			1,695			1,582			1,277			1,299			1,923			3,029			3,139			146	%		4	%		6,887			9,390			36	%

Compensation and benefits		1,043			1,023			942			737			844			1,362			1,943			1,965			167	%		1	%		3,745			6,114			63	%
Non-compensation expenses		341			400			641			591			336			632			806			943			60	%		17	%		1,973			2,717			38	%
Total non-interest expenses		1,384			1,423			1,583			1,328			1,180			1,994			2,749			2,908			119	%		6	%		5,718			8,831			54	%

Income / (loss) from continuing operations before taxes		949			272			(1	)		(51	)		119			(71	)		280			231			*			(18	%)		1,169			559			(52	%)
Income tax provision / (benefit) from continuing operations (2)		356			100			(13	)		3			46			(29	)		92			69			*			(25	%)		446			178			(60	%)
Income / (loss) from continuing operations		593			172			12			(54	)		73			(42	)		188			162			*			(14	%)		723			381			(47	%)
Gain / (loss) from discontinued operations after tax		0			0			0			0			0			0			0			0			--			--			0			0			--
Net income / (loss)		593			172			12			(54	)		73			(42	)		188			162			*			(14	%)		723			381			(47	%)
Net income / (loss) applicable to non-controlling interests (3)		0			0			0			0			0			(118	)		83			133			*			60	%		0			98			*
Net income / (loss) applicable to Morgan Stanley	$	593		$	172		$	12		$	(54	)	$	73		$	76		$	105		$	29			154	%		(72	%)	$	723		$	283			(61	%)

Amounts applicable to Morgan Stanley:
Income / (loss) from continuing operations		593			172			12			(54	)		73			76			105			29			154	%		(72	%)		723			283			(61	%)
Gain / (loss) from discontinued operations after tax		0			0			0			0			0			0			0			0			--			--			0			0			--
Net income / (loss) applicable to Morgan Stanley	$	593		$	172		$	12		$	(54	)	$	73		$	76		$	105		$	29			154	%		(72	%)	$	723		$	283			(61	%)

Return on average common equity from continuing operations (4)		*			48	%		3	%		*			20	%		7	%		5	%		1	%								49	%		5	%
Pre-tax profit margin (5)		41	%		16	%		*			*			9	%		*			9	%		7	%								17	%		6	%
Compensation and benefits as a % of net revenues		45	%		60	%		60	%		58	%		65	%		71	%		64	%		63	%								54	%		65	%			��


Note: Refer to End Notes on pages 16 - 21 and Legal Notice on page 22.

MORGAN STANLEY
Quarterly Financial Information and Statistical Data
Global Wealth Management Group
(unaudited)



	Quarter Ended (1)																								Percentage Change From:
	Mar 31, 2008			June 30, 2008			Sept 30, 2008			Dec 31, 2008			Mar 31, 2009			June 30, 2009			Sept 30, 2009			Dec 31, 2009			4Q09 vs. 4Q08			4Q09 vs. 3Q09


Global representatives		8,271			8,343			8,588			8,356			8,148			18,444			18,160			18,135			117	%		--

Annualized revenue per global
representative (thousands) (2)	$	772		$	809		$	750		$	603		$	630		$	671		$	662		$	692			15	%		5	%

Assets by client segment (billions)
$10m or more		222			219			190			153			146			389			438			453			196	%		3	%
$1m - $10m		261			263			241			201			191			562			620			637			*			3	%
Subtotal - > $1m		483			482			431			354			337			951			1,058			1,090			*			3	%
$100k - $1m		195			197			188			169			162			412			420			418			147	%		--
< $100k		28			28			28			27			26			57			54			52			93	%		(4	%)
Total client assets (billions)	$	706		$	707		$	647		$	550		$	525		$	1,420		$	1,532		$	1,560			184	%		2	%

% of assets by client segment > $1m		68	%		68	%		67	%		64	%		64	%		67	%		69	%		70	%

Fee-based client account assets (billions) (3)	$	184		$	187		$	169		$	138		$	124		$	325		$	365		$	379			175	%		4	%
Fee-based assets as a % of client assets		26	%		26	%		26	%		25	%		24	%		23	%		24	%		24	%


Bank deposit program (millions) (4)	$	33,418		$	34,467		$	33,791		$	38,771		$	46,796		$	105,675		$	110,420		$	112,490			190	%		2	%

Client assets per global
representative (millions) (5)	$	85		$	85		$	75		$	66		$	64		$	77		$	84		$	86			30	%		2	%

Domestic retail net new assets (billions) (6)	$	8.4		$	16.2		$	8.3		$	(7.4	)	$	3.0		$	(2.0	)	$	(8.8	)	$	(4.7	)		36	%		47	%

Domestic retail locations		449			460			462			464			465			958			930			895			93	%		(4	%)



Note: Refer to End Notes on pages 16 - 21 and Legal Notice on page 22.

MORGAN STANLEY
Quarterly Asset Management Income Statement Information
(unaudited, dollars in millions)


	Quarter Ended (1)																								Percentage Change From:						Twelve Months Ended
	Mar 31, 2008			June 30, 2008			Sept 30, 2008			Dec 31, 2008			Mar 31, 2009			June 30, 2009			Sept 30, 2009			Dec 31, 2009			4Q09 vs. 4Q08			4Q09 vs. 3Q09			Dec 31, 2008			Dec 31, 2009			Percentage Change
Revenues:
Investment banking	$	15		$	29		$	10		$	(30	)	$	1		$	5		$	2		$	2			107	%		--		$	24		$	10			(58	%)
Principal transactions:
Trading		(58	)		(103	)		22			(155	)		3			(90	)		(22	)		41			126	%		*			(294	)		(68	)		77	%
Investments		(205	)		(177	)		(261	)		(786	)		(347	)		57			43			65			108	%		51	%		(1,429	)		(182	)		87	%
Commissions		0			0			0			1			0			0			0			0			*			--			1			0			*
Asset management, distribution and admin. fees		555			585			506			396			370			395			428			411			4	%		(4	%)		2,042			1,604			(21	%)
Other		68			10			1			88			16			12			12			7			(92	%)		(42	%)		167			47			(72	%)
Total non-interest revenues		375			344			278			(486	)		43			379			463			526			*			14	%		511			1,411			176	%

Interest and dividends		5			12			35			103			7			6			6			8			(92	%)		33	%		155			27			(83	%)
Interest expense		20			41			87			55			28			27			22			24			(56	%)		9	%		203			101			(50	%)
Net interest		(15	)		(29	)		(52	)		48			(21	)		(21	)		(16	)		(16	)		(133	%)		--			(48	)		(74	)		(54	%)
Net revenues		360			315			226			(438	)		22			358			447			510			*			14	%		463			1,337			189	%

Compensation and benefits		271			362			274			(19	)		93			331			370			310			*			(16	%)		888			1,104			24	%
Non-compensation expenses		246			272			217			277			212			237			202			255			(8	%)		26	%		1,012			906			(10	%)
Total non-interest expenses		517			634			491			258			305			568			572			565			119	%		(1	%)		1,900			2,010			6	%

Income / (loss) from continuing operations before taxes		(157	)		(319	)		(265	)		(696	)		(283	)		(210	)		(125	)		(55	)		92	%		56	%		(1,437	)		(673	)		53	%
Income tax provision / (benefit) from continuing operations		(56	)		(133	)		(87	)		(301	)		(33	)		(120	)		3			(68	)		77	%		*			(577	)		(218	)		62	%
Income / (loss) from continuing operations		(101	)		(186	)		(178	)		(395	)		(250	)		(90	)		(128	)		13			103	%		110	%		(860	)		(455	)		47	%
Gain / (loss) from discontinued operations after tax (2)		29			51			(33	)		(328	)		(168	)		(19	)		(140	)		245			175	%		*			(281	)		(82	)		71	%
Net income / (loss)		(72	)		(135	)		(211	)		(723	)		(418	)		(109	)		(268	)		258			136	%		196	%		(1,141	)		(537	)		53	%
Net income / (loss) applicable to non-controlling interests (3)		0			0			0			0			0			(1	)		(62	)		13			*			121	%		0			(50	)		*
Net income / (loss) applicable to Morgan Stanley	$	(72	)	$	(135	)	$	(211	)	$	(723	)	$	(418	)	$	(108	)	$	(206	)	$	245			134	%		*		$	(1,141	)	$	(487	)		57	%

Amounts applicable to Morgan Stanley:
Income / (loss) from continuing operations		(101	)		(186	)		(178	)		(395	)		(250	)		(89	)		(66	)		0			*			*			(860	)		(405	)		53	%
Gain / (loss) from discontinued operations after tax (2)		29			51			(33	)		(328	)		(168	)		(19	)		(140	)		245			175	%		*			(281	)		(82	)		71	%
Net income / (loss) applicable to Morgan Stanley	$	(72	)	$	(135	)	$	(211	)	$	(723	)	$	(418	)	$	(108	)	$	(206	)	$	245			134	%		*		$	(1,141	)	$	(487	)		57	%

Return on average common equity from continuing operations (4)		*			*			*			*			*			*			*			*									*			*
Pre-tax profit margin (5)		*			*			*			*			*			*			*			*									*			*
Compensation and benefits as a % of net revenues	��	75	%		115	%		121	%		4	%		*			93	%		83	%		61	%								192	%		83	%


Note: Refer to End Notes on pages 16 - 21 and Legal Notice on page 22.

MORGAN STANLEY
Quarterly Financial Information and Statistical Data (1)
Asset Management
(unaudited, dollars in billions)

	Quarter Ended																								Percentage Change From:						Twelve Months Ended
	Mar 31, 2008			June 30, 2008			Sept 30, 2008			Dec 31, 2008			Mar 31, 2009			June 30, 2009			Sept 30, 2009			Dec 31, 2009			4Q09 vs. 4Q08			4Q09 vs. 3Q09			Dec 31, 2008			Dec 31, 2009			Percentage Change
Assets under management or supervision

Net flows by asset class
Core Asset Management
Equity	$	(3.0	)	$	(2.9	)	$	(1.8	)	$	(1.0	)	$	1.0		$	(4.0	)	$	(1.4	)	$	(0.7	)		30	%		50	%	$	(8.7	)	$	(5.1	)		41	%
Fixed income - Long Term		0.0			(0.9	)		(4.8	)		(11.3	)		(4.5	)		(4.4	)		1.0			1.4			112	%		40	%		(17.0	)		(6.5	)		62	%
Money Market		11.5			12.8			(38.8	)		(3.6	)		(9.3	)		(13.0	)		(6.6	)		7.3			*			*			(18.1	)		(21.6	)		(19	%)
Alternatives (2)		6.8			2.9			0.1			(3.6	)		(3.9	)		(0.7	)		(0.2	)		1.3			136	%		*			6.2			(3.5	)		*
Total Core Asset Management		15.3			11.9			(45.3	)		(19.5	)		(16.7	)		(22.1	)		(7.2	)		9.3			148	%		*			(37.6	)		(36.7	)		2	%

Merchant Banking
Private Equity		0.0			(0.1	)		(0.1	)		1.0			(0.3	)		0.0			(0.1	)		0.8			(20	%)		*			0.8			0.4			(50	%)
Infrastructure		0.6			0.9			0.0			0.0			0.0			0.0			0.0			0.0			--			--			1.5			0.0			*
Real Estate		0.2			0.3			0.5			(0.3	)		(0.4	)		(1.9	)		(0.1	)		0.2			*			*			0.7			(2.2	)		*
Total Merchant Banking		0.8			1.1			0.4			0.7			(0.7	)		(1.9	)		(0.2	)		1.0			43	%		*			3.0			(1.8	)		*
Total net flows (3)	$	16.1		$	13.0		$	(44.9	)	$	(18.8	)	$	(17.4	)	$	(24.0	)	$	(7.4	)	$	10.3			*			*		$	(34.6	)	$	(38.5	)		(11	%)

Assets under management or supervision by asset class
Core Asset Management
Equity	$	122		$	117		$	94		$	73		$	69		$	80		$	93		$	98			34	%		5	%
Fixed income - Long Term		76			75			66			56			51			49			53			54			(4	%)		2	%
Money Market		111			124			85			81			71			59			52			59			(27	%)		13	%
Alternatives (2)		57			58			54			41			34			37			40			42			2	%		5	%
Total Core Asset Management		366			374			299			251			225			225			238			253			1	%		6	%

Merchant Banking
Private Equity		3			3			3			4			4			4			4			4			--			--
Infrastructure		3			4			4			4			4			4			4			4			--			--
Real Estate		37			37			36			35			24			17			14			15			(57	%)		7	%
Total Merchant Banking		43			44			43			43			32			25			22			23			(47	%)		5	%
Total Assets Under Management or Supervision (4)	$	409		$	418		$	342		$	294		$	257		$	250		$	260		$	276			(6	%)		6	%
Share of minority interest assets (5)		7			8			7			6			5			5			6			7			17	%		17	%
Total	$	416		$	426		$	349		$	300		$	262		$	255		$	266		$	283			(6	%)		6	%



Note: Refer to End Notes on pages 16 - 21 and Legal Notice on page 22.

MORGAN STANLEY
Quarterly Financial Information and Statistical Data
Consolidated Assets Under Management or Supervision
(unaudited, dollars in billions)

	Quarter Ended																Percentage Change From:
	Mar 31, 2008		June 30, 2008		Sept 30, 2008		Dec 31, 2008		Mar 31, 2009		June 30, 2009		Sept 30, 2009		Dec 31, 2009		4Q09 vs. 4Q08			4Q09 vs. 3Q09


Assets under management or supervision
Asset Management (1)	$	409	$	418	$	342	$	294	$	257	$	250	$	260	$	276		(6	%)		6	%
Global Wealth Management Group (2)		164		168		154		129		119		322		363		379		*			4	%
Total assets under management or supervision	$	573	$	586	$	496	$	423	$	376	$	572	$	623	$	655		55	%		5	%
Share of minority interest assets (3)		7		8		7		6		5		5		6		7		17	%		17	%
Total	$	580	$	594	$	503	$	429	$	381	$	577	$	629	$	662		54	%		5	%



Consolidated assets under management or supervision by asset class (1) (2) (4)
Equity	$	203	$	201	$	167	$	131	$	121	$	274	$	313	$	332		*			6	%
Fixed income		218		232		184		168		153		181		187		195		16	%		4	%
Alternatives (5)		57		58		54		41		34		41		44		46		12	%		5	%
Private Equity		3		3		3		4		4		4		4		4		--			--
Infrastructure		3		4		4		4		4		4		4		4		--			--
Real Estate		37		37		36		35		24		17		14		15		(57	%)		7	%
Sub-total		521		535		448		383		340		521		566		596		56	%		5	%
Other		52		51		48		40		36		51		57		59		48	%		4	%
Total assets under management or supervision	$	573	$	586	$	496	$	423	$	376	$	572	$	623	$	655		55	%		5	%
Share of minority interest assets (3)		7		8		7		6		5		5		6		7		17	%		17	%
Total	$	580	$	594	$	503	$	429	$	381	$	577	$	629	$	662		54	%		5	%



Note: Refer to End Notes on pages 16 - 21 and Legal Notice on page 22.

This page represents an addendum to the 4Q 2009 Financial Supplement.
MORGAN STANLEY
Real Estate Analysis
(unaudited, dollars in billions)

					Profit / (Loss)
	Statement of Financial Condition				Three Months Ended		Twelve Months Ended
	Sept 30, 2009		Dec 31, 2009		Dec 31, 2009		Dec 31, 2009
Other Consolidated Interests (1) (2) (3)	$	3.7	$	1.5	$	0.2	$	(0.8	)
Real Estate Funds (3)		0.5		0.5		0.0		(0.9	)
Real Estate Bridge Financing		0.0		0.0		0.0		(0.2	)
Infrastructure Fund		0.2		0.2		0.0		0.0
Total Real Estate Investments (4)	$	4.4	$	2.2	$	0.2	$	(1.9	)


The Company has contractual capital commitments, guarantees, lending facilities and counterparty arrangements with respect to these investments of $1.5 billion at Dec 31, 2009.


Note: Refer to End Notes on pages 16 - 21 and Legal Notice on page 22.

This page represents an addendum to the 4Q 2009 Financial Supplement, Appendix I

MORGAN STANLEY
Earnings Per Share (1)
(unaudited, in millions, except for per share data)


	Quarter Ended												Twelve Months Ended
	Mar 31, 2009			June 30, 2009			Sept 30, 2009			Dec 31, 2009			Dec 31, 2009

Basic Earnings Per Share
Income / (loss) from continuing operations applicable to Morgan Stanley	$	(19	)	$	(141	)	$	896		$	413		$	1,149
Gain / (loss) from discontinued operations applicable to Morgan Stanley after tax		(158	)		290			(139	)		204			197
Net Income / (loss) applicable to Morgan Stanley	$	(177	)	$	149		$	757		$	617		$	1,346
Less: Preferred Dividends (Series A)		(11	)		(11	)		(11	)		(12	)		(45	)
Less: Preferred Dividends (Series B – Mitsubishi)		(196	)		(196	)		(196	)		(196	)		(784	)
Less: Preferred Dividends (Series C – Mitsubishi)		(29	)		(13	)		(13	)		(13	)		(68	)
Less: Partial Redemption of Series C Preferred Stock (2)		0			(202	)		0			0			(202	)
Less: Preferred Dividends (Series D - Capital Purchase Program)		(125	)		(87	)		0			0			(212	)
Less: Amortization / accelerated accretion of Issuance Discount for Series D Preferred Stock (3)		(40	)		(892	)		0			0			(932	)
Less: Allocation of Earnings to:
CIC Equity Units		0			0			(13	)		(2	)		0
Unvested Restricted Stock Units		0			(4	)		(26	)		(18	)		(10	)
Earnings / (loss) applicable to Morgan Stanley common shareholders	$	(578	)	$	(1,256	)	$	498		$	376		$	(907	)
Weighted average common shares outstanding		1,012			1,138			1,294			1,297			1,185
Earnings per basic common share (4)
Income / (loss) from continuing operations applicable to Morgan Stanley common shareholders	$	(0.41	)	$	(1.36	)	$	0.48		$	0.14		$	(0.93	)
Gain / (loss) on discontinued operations applicable to Morgan Stanley common shareholders	$	(0.16	)	$	0.26		$	(0.09	)	$	0.15		$	0.17
Earnings per basic common share	$	(0.57	)	$	(1.10	)	$	0.39		$	0.29		$	(0.76	)

Diluted Earnings Per Share
Earnings / (loss) applicable to Morgan Stanley common shareholders	$	(578	)	$	(1,256	)	$	498		$	376		$	(907	)
Income impact of assumed conversions:
Preferred stock dividends		0			0			0			0			0
Income / (loss) available to common shareholders plus assumed conversions	$	(578	)	$	(1,256	)	$	498		$	376		$	(907	)

Weighted average common shares outstanding		1,012			1,138			1,294			1,297			1,185
Effect of dilutive securities:
Stock options		0			0			0			0			0
Series B Preferred Stock		0			0			0			0			0
Capital Purchase Program Warrant (3)		0			0			6			0			0
Weighted average common shares outstanding and common stock equivalents (5)		1,012			1,138			1,300			1,297			1,185

Earnings per diluted common share (4)
Income / (loss) from continuing operations applicable to Morgan Stanley common shareholders	$	(0.41	)	$	(1.36	)	$	0.48		$	0.14		$	(0.93	)
Gain / (loss) on discontinued operations applicable to Morgan Stanley common shareholders	$	(0.16	)	$	0.26		$	(0.10	)	$	0.15		$	0.17
Earnings per diluted common share	$	(0.57	)	$	(1.10	)	$	0.38		$	0.29		$	(0.76	)



Note: Refer to End Notes on pages 16 - 21 and Legal Notice on page 22.

This page represents an addendum to the 4Q 2009 Financial Supplement, Appendix II

MORGAN STANLEY
Earnings Per Share Calculation Under Two-Class Method
Three Months Ended December 31, 2009
(unaudited, in millions, except for per share data)



	(A)	(B)	(C)	(D)	(E)	(F)	(G)	(H)
							(D)+(E)+(F)	(G)/(A)
	Weighted Average # of Shares	% Allocation (2)	Net Income Applicable to Common Shareholders (3)	Distributed Earnings (4)	Undistributed Earnings Not in Excess of Reference Dividend (5)	Undistributed Earnings in Excess of Reference Dividend (5)	Total Earnings Allocated	Basic EPS (9)
Basic Common Shares	1,297	88%		$65	$285	$26	$376 (6)	$0.29
Unvested Restricted Stock Units	63	4%		$3	$14	$1	$18 (7)	N/A
CIC Equity Units (1)	116	8%		$0	$0	$2	$2 (8)	N/A
	1,476	100%	$396	$68	$299	$29	$396



Note: Refer to End Notes on pages 16 - 21 and Legal Notice on page 22.

MORGAN STANLEY

End Notes

Page 1:
(1)	The quarters ended June 30, 2009, Sept 30, 2009, Dec 31, 2009 and the twelve months ended Dec 31, 2009 include results from the Morgan Stanley Smith Barney joint venture (MSSB) effective from May 31, 2009.
(2)	Results for the quarters ended Mar 31, 2008, June 30, 2008, Sept 30, 2008, Dec 31, 2008, Mar 31, 2009, June 30, 2009, Sept 30, 2009 and Dec 31, 2009 include positive / (negative) revenues of $1.8 billion, $(0.2) billion, $9.0 billion, $(5.7) billion, $(1.5) billion, $(2.1) billion, $(0.8) billion and $(0.7) billion, respectively, related to the movement in Morgan Stanley's credit spreads on certain long term debt.
(3)	Represents consolidated income / (loss) from continuing operations applicable to Morgan Stanley before gain / (loss) from discontinued operations.
(4)	The earnings per share for the quarter ended June 30, 2009 includes the following charges: (a) $850 million for the accelerated amortization of the Preferred Stock issuance discount related to the Company's repurchase of its Series D Fixed Rate Cumulative Perpetual Preferred Stock and (b) $202 million related to the partial redemption of Series C Non-Cumulative Non-Voting Preferred Stock issued to Mitsubishi UFJ Financial Group, Inc. (MUFG) in exchange for its purchase of the Company's common stock.
(5)	Summation of the quarters' earnings per common share may not equal the year-to-date amounts due to the averaging effect of the number of shares and share equivalents throughout the year.
(6)	The quarter ended Dec 31, 2009, and prior periods, include the results of the retail Asset Management business, including Van Kampen, and the results of Crescent, subsequent to the date of consolidation. In addition, the quarter includes the finalization of the tax liability related to the Company's sales of its remaining interest in MSCI Inc. and the impairment charges and loss on the sale of an alternative energy investment (both items are reported in Institutional Securities).

Page 2:
(1)	The quarters ended June 30, 2009, Sept 30, 2009, Dec 31, 2009 and the twelve months ended Dec 31, 2009 include the results of MSSB effective from May 31, 2009.
(2)	The quarter ended Dec 31, 2009, and prior periods, include the results of the retail Asset Management business, including Van Kampen, and the results of Crescent, subsequent to the date of consolidation. In addition, the quarter includes the finalization of the tax liability related to the Company's sales of its remaining interest in MSCI Inc. and the impairment charges and loss on the sale of an alternative energy investment (both items are reported in Institutional Securities).
(3)	Effective January 1, 2009, the Company adopted the accounting guidance on non-controlling interests per FASB Accounting Standards Codification ("ASC") 810 Consolidation which requires retrospective application. The quarters ended June 30, 2009, Sept 30, 2009, Dec 31, 2009 and the twelve months ended Dec 31, 2009 include the impact of MSSB, which is 51% owned by the Company and 49% owned by Citigroup Inc. (Citigroup) (reported in Global Wealth Management Group). The quarter and twelve months ended Dec 31, 2009 also include the limited partnership interests related to certain Morgan Stanley Real Estate Funds, which were included in the Company's consolidated results beginning Sept 30, 2009 (reported in Asset Management).
(4)	The effective tax rate for the quarter ended Mar 31, 2009 includes an additional tax benefit resulting from the anticipated repatriation of non-U.S. earnings at lower than previously estimated tax rates.

Page 3:
(1)	All data presented in millions except ratios, shares outstanding, book values and number of employees.
(2)	The quarters ended June 30, 2009, Sept 30, 2009, Dec 31, 2009 and the twelve months ended Dec 31, 2009 include results from MSSB effective from May 31, 2009.
(3)	Reflects the regional view of the Company's consolidated net revenues, on a managed basis, based on the following methodology: Institutional Securities: investment banking - client location, equity capital markets - client location, debt capital markets - revenue recording location, sales & trading - trading desk location. Global Wealth Management: financial advisor location. Asset Management: client location except for the merchant banking business which is based on asset location. All periods exclude net revenues related to MSCI Inc., Crescent and the retail Asset Management business, including Van Kampen.
(4)	Beginning with the quarter ended June 30, 2009, worldwide employees includes headcount related to MSSB. The quarter ended Dec 31, 2009, and prior periods, exclude headcount related to Crescent.
(5)	For the quarter ended June 30, 2009, Morgan Stanley shareholders' equity reflects a reduction of $10 billion related to the repurchase of the Company's Series D Preferred Stock issued under the Capital Purchase Program (TARP) and a reduction of $0.7 billion related to MUFG's partial exchange of the Company's Series C Preferred Stock for common stock. These decreases were partly offset by the addition of $6.9 billion related to the Company's equity offerings. In August 2009, the Company repurchased the TARP warrant for $950 million.
(6)	Goodwill and intangible balances net of allowable mortgage servicing rights deduction for quarters ended Mar 31, 2008, June 30, 2008, Sept 30, 2008, Dec 31, 2008, Mar 31, 2009, June 30, 2009, Sept 30, 2009 and Dec 31, 2009 of $373 million, $330 million, $261 million, $184 million, $160 million, $173 million, $130 million and $123 million, respectively. The balances for the quarter ended June 30, 2009, Sept 30, 2009 and Dec 31, 2009 include the Company's share of MSSB's goodwill and intangible assets.
(7)	Excludes non-controlling interests.
(8)	Tangible common equity equals common equity less goodwill and intangible assets net of allowable mortgage servicing rights deduction. The balance for the quarters ended June 30, 2009, Sept 30, 2009 and Dec 31, 2009 also includes the Company's share of MSSB's goodwill and intangible assets.
(9)	Leverage ratio equals total assets divided by tangible Morgan Stanley shareholders' equity.
(10)	Represents average daily 95% / one-day value-at-risk ("VaR"). Includes non-trading VaR for the quarters ended Mar 31, 2008, June 30, 2008, Sept 30, 2008, Dec 31, 2008, Mar 31, 2009, June 30, 2009, Sept 30, 2009 and Dec 31, 2009 of $36 million, $53 million, $71 million, $66 million, $83 million, $108 million, $111 million and $106 million, respectively. See page 6 for trading VaR.
(11)	Book value per common share equals common equity divided by period end common shares outstanding.
(12)	Tangible book value per common share equals tangible common equity divided by period end common shares outstanding.

MORGAN STANLEY

End Notes

Page 4:
(1)	The quarters ended June 30, 2009, Sept 30, 2009, Dec 31, 2009 and the twelve months ended Dec 31, 2009 include results from MSSB effective from May 31, 2009.
(2)	The Company’s economic capital framework estimates the amount of equity capital required to support the businesses over a wide range of market environments while simultaneously satisfying regulatory, rating agency and investor requirements. Economic capital is assigned to each segment based on a regulatory capital framework plus additional capital for stress losses. Economic capital requirements are met by regulatory Tier 1 equity (including common shareholders' equity, certain preferred stock, eligible hybrid capital instruments, non-controlling interests and deductions of certain goodwill, intangible assets, net deferred tax assets and debt valuation adjustment), subject to regulatory limits. The framework will evolve over time in response to changes in the business and regulatory environment and to incorporate improvements in modeling techniques.
(3)	The quarter ended Dec 31, 2009, and prior periods, includes the amount of equity capital required to support Crescent and the retail Asset Management business, including Van Kampen. Periods prior to Sept 30, 2009 also include the equity capital required to support MSCI Inc.

Page 5:
(1)	Principal transactions investments revenue reflects net gain / (loss) on investments marked at fair value. The related investment asset balance for the quarters ended Mar 31, 2008, June 30, 2008, Sept 30, 2008, Dec 31, 2008, Mar 31, 2009, June 30, 2009, Sept 30, 2009 and Dec 31, 2009 are $10.7 billion, $10.3 billion, $9.7 billion, $6.7 billion, $6.3 billion, $6.1 billion, $6.1 billion and $6.1 billion, respectively.
(2)	Reflects operating results and gains on secondary equity offerings related to MSCI Inc. The quarter ended Dec 31, 2009 includes the finalization of the tax liability related to the Company's sales of its remaining interest in MSCI Inc. and the impairment charges and loss on the sale of an alternative energy investment.
(3)	Refer to page 4 for the allocation of average common equity.
(4)	Income / (loss) from continuing operations before taxes, as a % of net revenues.

Page 6:
(1)	Underwriting revenue excludes fees for Company self-issuances.
(2)	Includes principal transactions trading, commissions and net interest revenue. Other sales and trading net revenue primarily includes net gains / (losses) from the mark-to-market of loans and closed and pipeline commitments and related hedges, and results related to Investment Banking and other activities.
(3)	Represents the loss amount that one would not expect to exceed, on average, more than five times every one hundred trading days in the Company's trading positions if the portfolio were held constant for a one-day period. For a further discussion of the calculation of VaR and the limitations of the Company's VaR methodology, see Part II, Item 7A "Quantitative and Qualitative Disclosures about Market Risk" in the Company's Annual Report on Form 10-K for the fiscal year ended November 30, 2008. See page 3 for Aggregate Trading and Non-Trading VaR.

MORGAN STANLEY

End Notes

Page 7:
(1)	In connection with certain of its Institutional Securities business activities, the Company provides loans or lending commitments to select clients related to its leveraged acquisition finance or relationship lending activities. For a further discussion of this activity, see the Company's Current Report on Form 8-K dated August 24, 2009.
(2)	For the quarters ended Mar 31, 2008, June 30, 2008, Sept 30, 2008, Dec 31, 2008, Mar 31, 2009, June 30, 2009, Sept 30, 2009 and Dec 31, 2009, the leveraged acquisition finance portfolio of pipeline commitments and closed deals were $14.8 billion, $11.6 billion, $6.9 billion, $5.0 billion, $4.2 billion, $4.2 billion, $5.1 billion and $3.7 billion, respectively.
(3)	Reflects the notional balance of hedges utilized by the lending business.

Page 8:
(1)	The quarters ended June 30, 2009, Sept 30, 2009, Dec 31, 2009 and the twelve months ended Dec 31, 2009 include results from MSSB effective from May 31, 2009.
(2)	The tax provision / (benefit) for the quarters ended June 30, 2009, Sept 30, 2009, Dec 31, 2009 and the twelve months ended Dec 31, 2009 includes the Company's interest in MSSB.
(3)	The quarter ended June 30, 2009, Sept 30, 2009, Dec 31, 2009 and the twelve months ended Dec 31, 2009 primarily reflects the 49% allocation of MSSB's pre-tax results to Citigroup, plus some contractual allocations, including a one-time expense of $124 million related to replacement deferred compensation awards in June 2009.
(4)	Refer to page 4 for the allocation of average common equity.
(5)	Income / (loss) from continuing operations before taxes, as a % of net revenues.

Page 9:
(1)	The quarters ended June 30, 2009, Sept 30, 2009 and Dec 31, 2009 include results from MSSB effective from May 31, 2009.
(2)	Annualized revenue divided by average global representative headcount.
(3)	Represents the amount of assets in client accounts where the basis of payment for services is a fee calculated on those assets.
(4)	For the quarters ended June 30, 2009, Sept 30, 2009 and Dec 31, 2009 approximately $50 billion, $52 billion and $54 billion, respectively, is attributable to Morgan Stanley.
(5)	Total client assets divided by period end global representative headcount.
(6)	Represents net new assets in the U.S. broad-based branch system.

MORGAN STANLEY

End Notes

Page 10:
(1)	Principal transactions investments revenue reflects net gain / (loss) on investments marked at fair value including real estate funds, private equity funds and seed capital investments. The related investment asset balance for the quarters ended Mar 31, 2008, June 30, 2008, Sept 30, 2008, Dec 31, 2008, Mar 31, 2009, June 30, 2009, Sept 30, 2009 and Dec 31, 2009 are $4.5 billion, $5.3 billion, $4.8 billion, $3.6 billion, $3.0 billion, $2.5 billion, $2.9 billion and $3.0 billion, respectively.
(2)	The quarter ended Dec 31, 2009, and prior periods, include the results of the retail Asset Management business, including Van Kampen, and the results of Crescent, subsequent to the date of consolidation.
(3)	The quarter and twelve months ended Dec 31, 2009 also include the limited partnership interests related to certain Morgan Stanley Real Estate Funds, which were included in the Company's consolidated results beginning Sept 30, 2009.
(4)	Refer to page 4 for the allocation of average common equity.
(5)	Income / (loss) from continuing operations before taxes, as a % of net revenues.

Page 11:
(1)	Excludes the retail Asset Management business, including Van Kampen, following the decision to sell this business to Invesco, Ltd.
(2)	Includes a range of alternative investment products such as hedge funds, funds of hedge funds and funds of private equity funds.
(3)	Net Flows by region [inflow / (outflow)] for the quarters ended Mar 31, 2008, June 30, 2008, Sept 30, 2008, Dec 31, 2008, Mar 31, 2009, June 30, 2009, Sept 30, 2009 and Dec 31, 2009 are: U.S.: $8.9 billion, $10.1 billion, $(40.6) billion, $(11.5) billion, $(14.9) billion, $(17.1) billion, $(7.5) billion and $6.7 billion Non-U.S.: $7.2 billion, $2.9 billion, $(4.3) billion, $(7.3) billion, $(2.5) billion, $(6.9) billion, $0.1 billion and $3.6 billion
(4)	Assets under management or supervision by region for the quarters ended Mar 31, 2008, June 30, 2008, Sept 30, 2008, Dec 31, 2008, Mar 31, 2009, June 30, 2009, Sept 30, 2009 and Dec 31, 2009 are: U.S.: $281 billion, $291 billion, $232 billion, $200 billion, $171 billion, $163 billion, $166 billion and $176 billion Non-U.S.: $128 billion, $127 billion, $110 billion, $94 billion, $86 billion, $87 billion, $94 billion and $100 billion
(5)	Amount represents Asset Management's proportional share of assets managed by entities in which it owns a non-controlling interest.

MORGAN STANLEY

End Notes

Page 12:
(1)	Excludes the retail Asset Management business, including Van Kampen, following the decision to sell this business to Invesco, Ltd.
(2)	The quarters ended June 30, 2009, Sept 30, 2009 and Dec 31, 2009 include results from MSSB effective from May 31, 2009.
(3)	Amount represents Asset Management's proportional share of assets managed by entities in which it owns a non-controlling interest.
(4)	Includes assets under management or supervision associated with the Global Wealth Management Group.
(5)	Includes a range of alternative investment products such as hedge funds, funds of hedge funds and funds of private equity funds.

Page 13:
(1)	In the fourth quarter, Morgan Stanley conveyed Crescent’s real estate assets, that were subject to approximately $2.0 billion of remaining third-party financing with a single lender, to that lender in full satisfaction of its outstanding loan. Crescent's results, subsequent to the date of consolidation, are presented as discontinued operations for all periods.
(2)	Consolidated statement of income amounts directly related to investments held by consolidated subsidiaries are condensed in this presentation and include principal transactions, net operating revenues and expenses and impairment charges.
(3)	In the third quarter, Morgan Stanley consolidated certain real estate funds. This resulted in a transfer of investment assets of $0.2 billion, which is net of non-controlling interests of $0.6 billion, from Real Estate Funds to Other Consolidated Interests. The results for the quarter and twelve months ended Dec 31, 2009 for these consolidated subsidiaries, net of non-controlling interests, were not significant.
(4)	These balances exclude investments that benefit certain deferred compensation and employee co-investment plans.

MORGAN STANLEY

End Notes

Page 14:
(1)	The Company calculates earnings per share using the two-class method as defined in ASC 260. For further discussion of the Company's earnings per share calculations see Note 2 to the consolidated financial statements in the Company's Current Report on Form 8-K dated August 24, 2009.
(2)	MUFG elected to participate as an investor in the Company's offering of common stock on May 8, 2009 (closing date May 13, 2009). The Company repurchased from MUFG shares of the Company's non-convertible 10% Series C Non-Cumulative Non-Voting Perpetual Preferred Stock at a price per share equal to 110% of liquidation preference and with an aggregate repurchase price equal to the aggregate price to be paid by MUFG for its purchase of common stock in the offering. Upon redemption by the Company, the excess of the redemption value of $1,100 per share over the carrying value (approximately $784 per share) was charged to retained earnings and is deducted from the numerator in calculating basic and diluted earnings per share. For further discussion of the Company's Preferred Stock, see Note 11 to the consolidated financial statements in the Company's Current Report on Form 8-K dated August 24, 2009.
(3)	On June 17, 2009, the Company received approval to repurchase the $10 billion of capital issued under the Capital Purchase Program (TARP). Upon repayment, the difference between the carrying value of the Series D Preferred Stock and the liquidation value was charged to retained earnings and is reflected as a deduction to net income applicable to common shareholders in calculating basic and diluted earnings per share. In August 2009, the Company repurchased the Series D Preferred Stock warrant for $950 million.
(4)	Summation of the quarters' earnings per common share may not equal the year-to-date amounts due to the averaging effect of the number of shares and share equivalents throughout the year.
(5)	Anti-dilutive securities were excluded from the computation of diluted EPS.

Page 15:
(1)	For further information on the CIC Equity Units, see Note 11 to the consolidated financial statements in the Company's Current Report on Form 8-K dated August 24, 2009.
(2)	The percentage of weighted basic common shares, Unvested Restricted Stock Units ("Unvested RSUs") and weighted CIC Equity Units to the total weighted average of basic common shares, Unvested RSUs and CIC Equity Units.
(3)	Net income available to common shareholders for the quarter ended Dec 31, 2009 prior to allocation to the Unvested RSUs and CIC Equity Units.
(4)	Distributed earnings represent the dividends declared on common shares and Unvested RSUs, respectively, for the quarter ended Dec 31, 2009. The amount of dividends declared is based upon the number of common shares outstanding as of the dividend record date. During the quarter ended Dec 31, 2009, a $0.05 dividend was declared on common shares outstanding and Unvested RSUs. Under the terms of the securities purchase agreement for the sale of Equity Units to CIC, if a quarterly dividend is declared above $0.27 (the "reference dividend"), the CIC Equity Units will participate via an increase in the number of shares the Company will be required to deliver upon settlement of the contract. No cash dividends will be paid to the CIC Equity Units prior to settlement of the contract. Therefore, no distributed earnings will be allocated to the CIC Equity Units in the calculation of earnings per share under the two-class method.
(5)	The two-class method assumes all of the earnings for the reporting period are distributed and allocates to the Unvested RSUs and CIC Equity Units what they would be entitled to based on the contractual rights and obligations of the participating security. With respect to the CIC Equity Units, the amount allocated is representative of the value of the increase in the number of shares that the Company would be required to deliver upon settlement of the contract. No actual cash dividends will be paid to the CIC Equity Units. Assuming the reference dividend of $0.27 has been paid to the basic common shareholders, CIC Equity Units would receive a pro-rata allocation of the remaining undistributed earnings.
(6)	Total income applicable to common shareholders to be allocated to the common shares in calculating basic and diluted EPS for common shares (see Appendix I).
(7)	Total income applicable to common shareholders to be allocated to the Unvested RSUs reflected as a deduction to the numerator in determining basic EPS for common shares (see Appendix I).
(8)	Total income applicable to common shareholders to be allocated to the CIC Equity Units reflected as a deduction to the numerator in determining basic EPS for common shares (see Appendix I).
(9)	Basic and diluted EPS data are required to be presented only for classes of common stock, as described in ASC 260.

MORGAN STANLEY

Legal Notice

This Financial Supplement contains financial, statistical and business-related information, as well as business and segment trends.

The information should be read in conjunction with the Company's fourth quarter earnings press release issued January 20, 2010.

Morgan Stanley (MS) 8-KMorgan Stanley Reports Full-Year and Fourth Quarter Results