Parent Company

12 Months Ended

Dec. 31, 2021

Condensed Financial Information Disclosure [Abstract]

Parent Company Only—Condensed Income Statement and Comprehensive Income Statement


$ in millions	2021		2020		2019
Revenues
Dividends from bank subsidiaries	$	—	$	2,811	$	3,531
Dividends from BHC and non-bank subsidiaries	8,898		1,170		1,998
Total dividends from subsidiaries	8,898		3,981		5,529
Trading	229		(244)		(54)
Other	4		51		80
Total non-interest revenues	9,131		3,788		5,555
Interest income	2,648		3,666		5,121
Interest expense	2,822		3,087		4,661
Net interest	(174)		579		460
Net revenues	8,957		4,367		6,015
Non-interest expenses	443		387		300
Income before income taxes	8,514		3,980		5,715
Provision for (benefit from) income taxes	(203)		(109)		(73)
Net income before undistributed gain of subsidiaries	8,717		4,089		5,788
Undistributed gain of subsidiaries	6,317		6,907		3,254
Net income	15,034		10,996		9,042
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustments	(207)		102		(8)
Change in net unrealized gains (losses) on available-for-sale securities	(1,542)		1,580		1,137
Pensions and other	(53)		146		(66)
Change in net debt valuation adjustment	662		(1,002)		(1,559)
Comprehensive income	$	13,894	$	11,822	$	8,546
Net income	$	15,034	$	10,996	$	9,042
Preferred stock dividends and other	468		496		530
Earnings applicable to Morgan Stanley common shareholders	$	14,566	$	10,500	$	8,512

Parent Company Only—Condensed Balance Sheet


$ in millions, except share data	At December 31, 2021		At December 31, 2020
Assets
Cash and cash equivalents	$	15,342	$	7,102
Trading assets at fair value	5,298		6,862
Investment securities (includes $21,246 and $20,037 at fair value; $16,573 and $24,248 were pledged to various parties)	39,707		39,225
Securities purchased under agreement to resell to affiliates	21,116		34,698
Advances to subsidiaries:
Bank and BHC	59,757		22,692
Non-bank	96,202		121,731
Equity investments in subsidiaries:
Bank and BHC	69,059		52,951
Non-bank	48,481		47,450
Other assets	1,109		454
Total assets	$	356,071	$	333,165
Liabilities
Trading liabilities at fair value	$	1,688	$	1,623
Securities sold under agreements to repurchase from affiliates	16,928		24,349
Payables to and advances from subsidiaries	59,960		43,252
Other liabilities and accrued expenses	1,859		2,181
Borrowings (includes $15,894 and $18,804 at fair value)	170,195		159,979
Total liabilities	250,630		231,384
Commitments and contingent liabilities (see Note 15)
Equity
Preferred stock	7,750		9,250
Common stock, $0.01 par value:
Shares authorized: 3,500,000,000; Shares issued: 2,038,893,979; Shares outstanding: 1,772,226,530 and 1,809,624,144	20		20
Additional paid-in capital	28,841		25,546
Retained earnings	89,432		78,694
Employee stock trusts	3,955		3,043
Accumulated other comprehensive income (loss)	(3,102)		(1,962)
Common stock held in treasury at cost, $0.01 par value (266,667,449 and 229,269,835 shares)	(17,500)		(9,767)
Common stock issued to employee stock trusts	(3,955)		(3,043)
Total shareholders’ equity	105,441		101,781
Total liabilities and equity	$	356,071	$	333,165

Parent Company Only—Condensed Cash Flow Statement


$ in millions	2021		2020		2019






Net cash provided by (used for) operating activities	$	4,257	$	14,202	$	24,175
Cash flows from investing activities
Proceeds from (payments for):
Investment securities:
Purchases	(9,297)		(9,310)		(22,408)
Proceeds from sales	2,611		2,013		4,671
Proceeds from paydowns and maturities	5,636		5,651		3,157
Securities purchased under agreements to resell with affiliates	13,581		(24,584)		15,422
Securities sold under agreements to repurchase with affiliates	(7,422)		19,719		4,631
Advances to and investments in subsidiaries	(17,083)		(13,832)		(9,210)
Net cash provided by (used for) investing activities	(11,974)		(20,343)		(3,737)
Cash flows from financing activities
Proceeds from:
Issuance of preferred stock, net of issuance costs	1,275		—		497
Issuance of Borrowings	42,098		25,587		8,337
Payments for:
Borrowings	(28,592)		(22,105)		(24,282)
Repurchases of common stock and employee tax withholdings	(12,075)		(1,890)		(5,954)
Cash dividends	(4,171)		(2,739)		(2,627)
Net change in advances from subsidiaries	17,042		7,194		4,378
Other financing activities	—		(498)		12
Net cash provided by (used for) financing activities	15,577		5,549		(19,639)
Effect of exchange rate changes on cash and cash equivalents	380		(316)		(271)
Net increase (decrease) in cash and cash equivalents	8,240		(908)		528
Cash and cash equivalents, at beginning of period	7,102		8,010		7,482
Cash and cash equivalents, at end of period	$	15,342	$	7,102	$	8,010
Cash and cash equivalents:
Cash and due from banks	$	100	$	20	$	9
Deposits with bank subsidiaries	15,242		7,082		8,001
Cash and cash equivalents, at end of period	$	15,342	$	7,102	$	8,010
Restricted cash	$	441	$	381	$	—
Supplemental Disclosure of Cash Flow Information
Cash payments for:
Interest	$	2,970	$	3,472	$	4,677
Income taxes, net of refunds1	2,775		1,364		1,186

1.Represents total payments, net of refunds, made to various tax authorities and includes taxes paid on behalf of certain subsidiaries that are subsequently settled between the Parent Company and these subsidiaries. The settlements received from subsidiaries were $3.0 billion, $1.6 billion and $1.6 billion for 2021, 2020 and 2019, respectively.

For information on the Parent Company’s preferred stock, see Note 18.

Parent Company’s Borrowings with Original Maturities Greater than One Year


$ in millions	At December 31, 2021		At December 31, 2020
Senior	$	155,304	$	148,885
Subordinated	13,591		11,094
Total	$	168,895	$	159,979

Transactions with Subsidiaries

The Parent Company has transactions with its consolidated subsidiaries determined on an agreed-upon basis and has guaranteed certain unsecured lines of credit and contractual obligations on certain of its consolidated subsidiaries.

Guarantees

In the normal course of its business, the Parent Company guarantees certain of its subsidiaries’ obligations on a transaction-by-transaction basis under various financial arrangements. The Parent Company has issued guarantees on behalf of its subsidiaries to various U.S. and non-U.S. exchanges and clearinghouses that trade and clear securities and/or futures contracts. Under these guarantee arrangements, the Parent Company may be required to pay the financial obligations of its subsidiaries related to business transacted on or with the exchanges and clearinghouses in the event of a subsidiary’s default on its obligations to the exchange or the clearinghouse. The Parent Company has not recorded any contingent liability in its condensed financial statements for these arrangements and believes that any potential requirements to make payments under these arrangements are remote.

The Parent Company also, in the normal course of business, provides standard indemnities to counterparties on behalf of its subsidiaries for taxes, including U.S. and foreign withholding taxes, on interest and other payments made on derivatives, securities and stock lending transactions, and certain annuity products, and may also provide indemnities to or on behalf of affiliates from time to time for other arrangements. These indemnity payments could be required, as applicable, based on a change in the tax laws, change in interpretation of applicable tax rulings or claims arising from contractual relationships between affiliates. Certain contracts contain provisions that enable the Parent Company to terminate the agreement upon the occurrence of such events. The maximum potential amount of future payments that the Parent Company could be required to make under these indemnifications cannot be estimated. The Parent Company has not recorded any contingent liability in its condensed financial statements for these indemnifications and believes that the occurrence of any events that would trigger payments under these contracts is remote.

Guarantees of Debt Instruments and Warrants Issued by Subsidiaries


$ in millions	At December 31, 2021		At December 31, 2020
Aggregate balance	$	47,129	$	39,745

Guarantees under Subsidiary Lease Obligations


$ in millions	At December 31, 2021		At December 31, 2020
Aggregate balance1	$	610	$	865

1.Amounts primarily relate to the U.K.

Finance Subsidiary

The Parent Company fully and unconditionally guarantees the securities issued by Morgan Stanley Finance LLC, a wholly owned finance subsidiary. No other subsidiary of the Parent Company guarantees these securities.

Resolution and Recovery Planning

As indicated in the Firm’s 2021 targeted resolution plan submitted to the Federal Reserve and the FDIC, the Parent Company has amended and restated its support agreement with its material entities (including its wholly owned, direct subsidiary Morgan Stanley Holdings LLC (the “Funding IHC”) and certain other subsidiaries), as defined in the Firm’s 2021 targeted resolution plan. Under the secured, amended and restated support agreement, in the event of a resolution scenario, the Parent Company would be obligated to contribute all of its material assets that can be contributed under the terms of the amended and restated support agreement (other than shares in subsidiaries of the Parent Company and certain other assets) (“Contributable Assets”) to the material entities and/or the Funding IHC. The Funding IHC would be obligated to provide capital and liquidity, as applicable, to the material entities.