Morgan Stanley Announces Anticipated Resumption of Its Common Stock Repurchase Plan

Rhea-AI Summary

On December 18, 2020, Morgan Stanley (NYSE: MS) received approval from the Federal Reserve to resume common stock repurchases in Q1 2021, allowing for up to $10 billion in buybacks throughout the year. This decision reflects the firm’s substantial capital buffer, with over 400 basis points of excess capital. CEO James P. Gorman emphasized the commitment to return capital to shareholders while maintaining capacity to invest in business operations. Repurchases will be contingent on market conditions and the firm's financial performance, aligning with regulatory capital standards.

Positive

• Authorization for up to $10 billion stock repurchase enhances shareholder value.
• Significant capital buffer of 400bps positions the firm for continued investment and stability.

Negative

• Repurchases subject to market conditions may indicate potential volatility.
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On December 18, 2020, the Board of Governors of the Federal Reserve System (FRB) notified Morgan Stanley (NYSE: MS) that it would be permitted to resume repurchases of common stock in the first quarter of 2021, consistent with the FRB’s recently announced distribution limitations. The Firm’s Board of Directors authorized the repurchases of outstanding common stock of up to $10 billion in 2021 in recognition of our significant capital buffer.

James P. Gorman, Chairman and Chief Executive Officer of Morgan Stanley, said, “The results announced today allow us to restart our share repurchase program in January, and we expect to continue the program throughout the coming year. With over 400bps of excess capital, we are in a position to continue to invest in our businesses while returning capital to shareholders and absorbing market volatility.”

The repurchases will be subject to market conditions and the Firm’s financial performance. Repurchases under the program in any period will be consistent with the Firm’s Stress Capital Buffer (SCB) requirement and other regulatory capital standards.

Morgan Stanley is a leading global financial services firm providing investment banking, securities, wealth management and investment management services. With offices in more than 41 countries, the Firm's employees serve clients worldwide including corporations, governments, institutions and individuals. For more information about Morgan Stanley, please visit www.morganstanley.com.

View source version on businesswire.com: https://www.businesswire.com/news/home/20201218005738/en/

FAQ

What is the amount approved for Morgan Stanley's stock repurchase?

Morgan Stanley has been authorized to repurchase up to $10 billion in common stock in 2021.

When will Morgan Stanley start its stock repurchase program?

The stock repurchase program is set to begin in January 2021.

Why is Morgan Stanley allowed to resume stock repurchases?

The Federal Reserve approved the resumption of stock repurchases due to Morgan Stanley's significant capital buffer.

How does the stock repurchase affect Morgan Stanley's financial performance?

The repurchase program aims to enhance shareholder value while allowing the firm to invest in its business operations.

What conditions apply to Morgan Stanley's stock repurchase program?

Repurchases will depend on market conditions and the company's financial performance, adhering to regulatory standards.