UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2024

Commission File Number 1-11758

(Exact name of Registrant as specified in its charter)

Delaware

1585 Broadway

36-3145972

(212)

761-4000

(State or other jurisdiction of incorporation or organization)

New York,

NY

10036

(I.R.S. Employer Identification No.)

(Registrant’s telephone number, including area code)

(Address of principal executive offices, including Zip Code)

Securities registered pursuant to Section 12(b) of the Act:
Title of each class			Trading Symbol(s)			Name of exchange on which registered
Common Stock, $0.01 par value			MS			New York Stock Exchange
Depositary Shares, each representing 1/1,000th interest in a share of Floating Rate			MS/PA			New York Stock Exchange
Non-Cumulative Preferred Stock, Series A, $0.01 par value
Depositary Shares, each representing 1/1,000th interest in a share of Fixed-to-Floating Rate			MS/PE			New York Stock Exchange
Non-Cumulative Preferred Stock, Series E, $0.01 par value
Depositary Shares, each representing 1/1,000th interest in a share of Fixed-to-Floating Rate			MS/PF			New York Stock Exchange
Non-Cumulative Preferred Stock, Series F, $0.01 par value
Depositary Shares, each representing 1/1,000th interest in a share of Fixed-to-Floating Rate			MS/PI			New York Stock Exchange
Non-Cumulative Preferred Stock, Series I, $0.01 par value
Depositary Shares, each representing 1/1,000th interest in a share of Fixed-to-Floating Rate			MS/PK			New York Stock Exchange
Non-Cumulative Preferred Stock, Series K, $0.01 par value
Depositary Shares, each representing 1/1,000th interest in a share of 4.875%			MS/PL			New York Stock Exchange
Non-Cumulative Preferred Stock, Series L, $0.01 par value
Depositary Shares, each representing 1/1,000th interest in a share of 4.250%			MS/PO			New York Stock Exchange
Non-Cumulative Preferred Stock, Series O, $0.01 par value
Depositary Shares, each representing 1/1,000th interest in a share of 6.500%			MS/PP			New York Stock Exchange
Non-Cumulative Preferred Stock, Series P, $0.01 par value
Global Medium-Term Notes, Series A, Fixed Rate Step-Up Senior Notes Due 2026			MS/26C			New York Stock Exchange
of Morgan Stanley Finance LLC (and Registrant’s guarantee with respect thereto)
Global Medium-Term Notes, Series A, Floating Rate Notes Due 2029			MS/29			New York Stock Exchange
of Morgan Stanley Finance LLC (and Registrant’s guarantee with respect thereto)

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☒     No  ☐

Indicate by check mark whether the Registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrant was required to submit such files).    Yes  ☒    No  ☐

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the Registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.         ☐

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ☐    No ☒

As of April 30, 2024, there were 1,625,162,676 shares of the Registrant’s Common Stock, par value $0.01 per share, outstanding.

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Table of Contents

QUARTERLY REPORT ON FORM 10-Q

For the quarter ended March 31, 2024

Table of Contents						Part			Item			Page
Financial Information						I
Management’s Discussion and Analysis of Financial Condition and Results of Operations						I			2			4
Introduction												4
Executive Summary												5
Business Segments												9
Institutional Securities												10
Wealth Management												12
Investment Management												14
Supplemental Financial Information												16
Accounting Development Updates												16
Critical Accounting Estimates												16
Liquidity and Capital Resources												17
Balance Sheet												17
Regulatory Requirements												21
Quantitative and Qualitative Disclosures about Risk						I			3			26
Market Risk												26
Credit Risk												28
Country and Other Risks												33
Report of Independent Registered Public Accounting Firm												35
Consolidated Financial Statements and Notes						I			1			36
Consolidated Income Statement (Unaudited)												36
Consolidated Comprehensive Income Statement (Unaudited)												36
Consolidated Balance Sheet (Unaudited at March 31, 2024)												37
Consolidated Statement of Changes in Total Equity (Unaudited)												38
Consolidated Cash Flow Statement (Unaudited)												39
Notes to Consolidated Financial Statements (Unaudited)												40
1.			Introduction and Basis of Presentation									40
2.			Significant Accounting Policies									41
3.			Cash and Cash Equivalents									41
4.			Fair Values									41
5.			Fair Value Option									47
6.			Derivative Instruments and Hedging Activities									48
7.			Investment Securities									51
8.			Collateralized Transactions									53
9.			Loans, Lending Commitments and Related Allowance for Credit Losses									55
10.			Other Assets									58
11.			Deposits									58
12.			Borrowings and Other Secured Financings									59
13.			Commitments, Guarantees and Contingencies									59
14.			Variable Interest Entities and Securitization Activities									63
15.			Regulatory Requirements									65
16.			Total Equity									67
17.			Interest Income and Interest Expense									69
18.			Income Taxes									69
19.			Segment, Geographic and Revenue Information									69
Financial Data Supplement (Unaudited)												72
Glossary of Common Terms and Acronyms												73
Controls and Procedures						I			4			74
Other Information						II
Legal Proceedings						II			1			74
Risk Factors						II			1A			74
Unregistered Sales of Equity Securities and Use of Proceeds						II			2			74
Other Information						II			5			74
Exhibits						II			6			74
Signatures												74

			2

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Table of Contents

Available Information

We file annual, quarterly and current reports, proxy statements and other information with the Securities and Exchange Commission (“SEC”). The SEC maintains a website, www.sec.gov, that contains annual, quarterly and current reports, proxy and information statements, and other information that issuers file electronically with the SEC. Our electronic SEC filings are available to the public at the SEC’s website.

Our website is www.morganstanley.com. You can access our Investor Relations webpage at www.morganstanley.com/about-us-ir. We make available free of charge, on or through our Investor Relations webpage, our proxy statements, annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and any amendments to those reports filed or furnished pursuant to the Securities Exchange Act of 1934, as amended (“Exchange Act”), as soon as reasonably practicable after such material is electronically filed with, or furnished to, the SEC. We also make available, through our Investor Relations webpage, via a link to the SEC’s website, statements of beneficial ownership of our equity securities filed by our directors, officers, 10% or greater shareholders and others under Section 16 of the Exchange Act.

You can access information about our corporate governance at www.morganstanley.com/about-us-governance, our sustainability initiatives at www.morganstanley.com/about-us/sustainability-at-morgan-stanley, and our commitment to diversity and inclusion at www.morganstanley.com/about-us/diversity. Our webpages include:

 

•Amended and Restated Certificate of Incorporation;

•Amended and Restated Bylaws;

•Charters for our Audit Committee, Compensation, Management Development and Succession Committee, Governance and Sustainability Committee, Operations and Technology Committee, and Risk Committee;

•Corporate Governance Policies;

•Policy Regarding Corporate Political Activities;

•Policy Regarding Shareholder Rights Plan;

•Equity Ownership Commitment;

•Code of Ethics and Business Conduct;

•Code of Conduct;

•Integrity Hotline Information;

•Environmental and Social Policies; and

•2022 ESG Report: Diversity & Inclusion, Climate, and Sustainability.

Our Code of Ethics and Business Conduct applies to all directors, officers and employees, including our Chief Executive Officer, Chief Financial Officer and Deputy Chief Financial Officer. We will post any amendments to the Code of Ethics and Business Conduct and any waivers that are required to be disclosed by the rules of either the SEC or the New York Stock Exchange LLC (“NYSE”) on our website. You can request a copy of these documents, excluding exhibits, at no cost, by contacting Investor Relations, 1585 Broadway, New York, NY 10036 (212-761-4000). The information on our website is not incorporated by reference into this report.

			3

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Table of Contents

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Introduction

Morgan Stanley is a global financial services firm that maintains significant market positions in each of its business segments—Institutional Securities, Wealth Management and Investment Management. Morgan Stanley, through its subsidiaries and affiliates, provides a wide variety of products and services to a large and diversified group of clients and customers, including corporations, governments, financial institutions and individuals. Unless the context otherwise requires, the terms “Morgan Stanley,” “Firm,” “us,” “we” or “our” mean Morgan Stanley (the “Parent Company”) together with its consolidated subsidiaries. See the “Glossary of Common Terms and Acronyms” for the definition of certain terms and acronyms used throughout this Form 10-Q.

A description of the clients and principal products and services of each of our business segments is as follows:

Institutional Securities provides a variety of products and services to corporations, governments, financial institutions and ultra-high net worth clients. Investment Banking services consist of capital raising and financial advisory services, including the underwriting of debt, equity securities and other products, as well as advice on mergers and acquisitions, restructurings and project finance. Our Equity and Fixed Income businesses include sales, financing, prime brokerage, market-making, Asia wealth management services and certain business-related investments. Lending activities include originating corporate loans and commercial real estate loans, providing secured lending facilities, and extending securities-based and other financing to customers. Other activities include research.

Wealth Management provides a comprehensive array of financial services and solutions to individual investors and small to medium-sized businesses and institutions covering: financial advisor-led brokerage, custody, administrative and investment advisory services; self-directed brokerage services; financial and wealth planning services; workplace services, including stock plan administration; securities-based lending, residential real estate loans and other lending products; banking; and retirement plan services.

Investment Management provides a broad range of investment strategies and products that span geographies, asset classes, and public and private markets to a diverse group of clients across institutional and intermediary channels. Strategies and products, which are offered through a variety of investment vehicles, include equity, fixed income, alternatives and solutions, and liquidity and overlay services. Institutional clients include defined benefit/defined contribution plans, foundations, endowments, government entities, sovereign wealth funds, insurance companies, third-party fund sponsors and corporations. Individual clients are generally served through intermediaries, including affiliated and non-affiliated distributors.

Management’s Discussion and Analysis includes certain metrics that we believe to be useful to us, investors, analysts and other stakeholders by providing further transparency about, or an additional means of assessing, our financial condition and operating results. Such metrics, when used, are defined and may be different from or inconsistent with metrics used by other companies.

The results of operations in the past have been, and in the future may continue to be, materially affected by: competition; risk factors; legislative, legal and regulatory developments; and other factors. These factors also may have an adverse impact on our ability to achieve our strategic objectives. Additionally, the discussion of our results of operations herein may contain forward-looking statements. These statements, which reflect management’s beliefs and expectations, are subject to risks and uncertainties that may cause actual results to differ materially. For a discussion of the risks and uncertainties that may affect our future results, see “Forward-Looking Statements,” “Business—Competition,” “Business—Supervision and Regulation” and “Risk Factors” in the 2023 Form 10-K and “Liquidity and Capital Resources—Regulatory Requirements” herein.

			4			March 2024 Form 10-Q

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Table of Contents
Management’s Discussion and Analysis

Executive Summary

Overview of Financial Results

Consolidated Results—Three Months Ended March 31, 2024

•The Firm reported net revenues of $15.1 billion and net income of $3.4 billion with strong contributions across each of our businesses.

•The Firm delivered ROE of 14.5% and ROTCE of 19.7% (see “Selected Non-GAAP Financial Information” herein).

•The Firm’s expense efficiency ratio was 71% demonstrating operating leverage in an improving market environment.

•At March 31, 2024, the Firm’s Standardized Common Equity Tier 1 capital ratio was 15.0%.

•Institutional Securities net revenues of $7.0 billion reflect strong performance across the broad franchise, with particular strength in Equity as well as underwriting revenues, partially offset by lower results in Advisory.

•Wealth Management delivered a pre-tax margin of 26.3%. Net revenues were $6.9 billion on higher asset management revenues driven by the positive market environment. Net new assets for the quarter were $95 billion.

•Investment Management results reflect net revenues of $1.4 billion on higher average AUM of $1.5 trillion. The quarter included positive long-term net flows of $7.6 billion.

Net Revenues

($ in millions)

Net Income Applicable to Morgan Stanley

($ in millions)

Earnings per Diluted Common Share

We reported net revenues of $15.1 billion in the quarter ended March 31, 2024 (“current quarter,” or “1Q 2024”), which increased by 4% compared with $14.5 billion in the quarter ended March 31, 2023 (“prior year quarter,” or “1Q 2023”). For the current quarter, net income applicable to Morgan Stanley was $3.4 billion, or $2.02 per diluted common share, which increased by 14%, or 19% compared with $3.0 billion, or $1.70 per diluted common share in the prior year quarter.

Non-interest Expenses

($ in millions)

March 2024 Form 10-Q			5

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Table of Contents
Management’s Discussion and Analysis

•Compensation and benefits expenses of $6,696 million in the current quarter increased 4% from the prior year quarter, primarily due to an increase in the formulaic payout to Wealth Management representatives driven by higher compensable revenues and higher discretionary incentive compensation, partially offset by lower stock-based compensation expense in the prior year quarter.

•Non-compensation expenses of $4,051 million in the current quarter decreased 2% from the prior year quarter, primarily driven by lower legal and professional services expenses and lower marketing and business development costs, partially offset by an increased technology spend, an incremental FDIC special assessment cost of $42 million and higher execution-related expenses.

Provision for Credit Losses

The Provision for credit losses on loans and lending commitments was a net release of $6 million, primarily as a result of improvements in the macroeconomic outlook. This was partially offset by provisions for certain specific commercial real estate and corporate loans and modest growth in certain other loan portfolios. The Provision for credit losses on loans and lending commitments in the prior year quarter was $234 million, primarily related to a deterioration in both the macroeconomic outlook and the commercial real estate portfolio.

For further information on the Provision for credit losses, see “Credit Risk” herein.

Business Segment Results

Net Revenues by Segment1

($ in millions)

Net Income Applicable to Morgan Stanley by Segment1

($ in millions)

1.The amounts in the charts represent the contribution of each business segment to the total of the applicable financial category and may not sum to the total presented on top of the bars due to intersegment eliminations. See Note 19 to the financial statements for details of intersegment eliminations.

•Institutional Securities net revenues of $7,016 million in the current quarter increased 3% from the prior year quarter, primarily reflecting higher underwriting revenues and higher Equity results, partially offset by lower Advisory and Fixed income results.

•Wealth Management net revenues of $6,880 million in the current quarter increased 5% from the prior year quarter, primarily reflecting higher Asset management revenues and Transactional revenues, partially offset by lower Net interest revenues.

•Investment Management net revenues of $1,377 million in the current quarter increased 7% from the prior year quarter, primarily reflecting an increase in Asset management and related fees.

Net Revenues by Region1

($ in millions)

1.For a discussion of how the geographic breakdown of net revenues is determined, see Note 22 to the financial statements in the 2023 Form 10-K.

•Americas net revenues in the current quarter increased 7% from the prior year quarter, driven by higher results across all business segments.

			6			March 2024 Form 10-Q

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Table of Contents
Management’s Discussion and Analysis

•EMEA net revenues in the current quarter increased 5% from the prior year quarter, primarily driven by higher results from Investment Banking and Equity, partially offset by lower results from Fixed income within the Institutional Securities business segment.

•Asia net revenues in the current quarter decreased 12% from the prior year quarter, primarily driven by lower results from Fixed income and Equity within the Institutional Securities business segment.

Selected Financial Information and Other Statistical Data

						Three Months Ended March 31,
$ in millions, except per share data									2024			2023
Consolidated results
Net revenues									$	15,136		$	14,517
Earnings applicable to Morgan Stanley common shareholders									$	3,266		$	2,836
Earnings per diluted common share									$	2.02		$	1.70
Consolidated financial measures
Expense efficiency ratio1									71		%	72		%
ROE2									14.5		%	12.4		%
ROTCE2, 3									19.7		%	16.9		%
Pre-tax margin4									29		%	26		%
Effective tax rate									21.2		%	19.3		%
Pre-tax margin by segment4
Institutional Securities									34		%	28		%
Wealth Management									26		%	26		%
Investment Management									18		%	13		%

$ in millions, except per share data, worldwide employees and client assets			At March 31, 2024			At December 31, 2023
Average liquidity resources for three months ended5			$	318,664		$	314,504
Loans6			$	227,145		$	226,828
Total assets			$	1,228,503		$	1,193,693
Deposits			$	352,494		$	351,804
Borrowings			$	271,383		$	263,732
Common equity			$	90,448		$	90,288
Tangible common equity3			$	66,813		$	66,527
Common shares outstanding			1,627			1,627
Book value per common share7			$	55.60		$	55.50
Tangible book value per common share3, 7			$	41.07		$	40.89
Worldwide employees (in thousands)			80			80
Client assets8 (in billions)			$	7,000		$	6,588
Capital Ratios9
Common Equity Tier 1 capital—Standardized			15.0		%	15.2		%
Tier 1 capital—Standardized			16.9		%	17.1		%
Common Equity Tier 1 capital—Advanced			15.4		%	15.5		%
Tier 1 capital—Advanced			17.3		%	17.4		%
Tier 1 leverage			6.7		%	6.7		%
SLR			5.4		%	5.5		%

1.The expense efficiency ratio represents total non-interest expenses as a percentage of net revenues.

2.ROE and ROTCE represent annualized earnings applicable to Morgan Stanley common shareholders as a percentage of average common equity and average tangible common equity, respectively.

3.Represents a non-GAAP financial measure. See “Selected Non-GAAP Financial Information” herein.

4.Pre-tax margin represents income before provision for income taxes as a percentage of net revenues.

5.For a discussion of Liquidity resources, see “Liquidity and Capital Resources—Balance Sheet—Liquidity Risk Management Framework—Liquidity Resources” herein.

6.Includes loans held for investment, net of ACL, loans held for sale and also includes loans at fair value, which are included in Trading assets in the balance sheet.

7.Book value per common share and tangible book value per common share equal common equity and tangible common equity, respectively, divided by common shares outstanding.

8.Client assets represents Wealth Management client assets and Investment Management AUM. Certain Wealth Management client assets are invested in Investment Management products and are also included in Investment Management’s AUM.

9.For a discussion of our capital ratios, see “Liquidity and Capital Resources—Regulatory Requirements” herein.

Economic and Market Conditions

The market environment continued to improve in the first quarter of 2024, despite heightened geopolitical risks, continued inflationary concerns and uncertainty regarding the future path of interest rates, which have remained persistently high relative to recent years. The timing and pace of interest rate changes remain unknown and could impact capital markets in 2024. The market environment impacted our businesses, as discussed further in “Business Segments” herein, and, to the extent that it continues to remain uncertain, could adversely impact client confidence and related activity.

For more information on economic and market conditions, and the potential effects of geopolitical events and acts of war or aggression on our future results, refer to “Risk Factors” and “Forward-Looking Statements” in the 2023 Form 10-K.

Selected Non-GAAP Financial Information

We prepare our financial statements using U.S. GAAP. From time to time, we may disclose certain “non-GAAP financial measures” in this document or in the course of our earnings releases, earnings and other conference calls, financial presentations, definitive proxy statements and other public disclosures. A “non-GAAP financial measure” excludes, or includes, amounts from the most directly comparable measure calculated and presented in accordance with U.S. GAAP. We consider the non-GAAP financial measures we disclose to be useful to us, investors, analysts and other stakeholders by providing further transparency about, or an alternate means of assessing or comparing our financial condition, operating results and capital adequacy.

These measures are not in accordance with, or a substitute for, U.S. GAAP and may be different from or inconsistent with non-GAAP financial measures used by other companies. Whenever we refer to a non-GAAP financial measure, we will also generally define it or present the most directly comparable financial measure calculated and presented in accordance with U.S. GAAP, along with a reconciliation of the differences between the U.S. GAAP financial measure and the non-GAAP financial measure.

We present certain non-GAAP financial measures that exclude the impact of mark-to-market gains and losses on DCP investments from net revenues and compensation expenses. The impact of DCP is primarily reflected in our Wealth Management business segment results. These measures allow for better comparability of period-to-period underlying operating performance and revenue trends,

March 2024 Form 10-Q			7

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Table of Contents
Management’s Discussion and Analysis

especially in our Wealth Management business segment. By excluding the impact of these items, we are better able to describe the business drivers and resulting impact to net revenues and corresponding change to the associated compensation expenses. For more information, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Executive Summary” in the 2023 Form 10-K.

Tangible common equity is a non-GAAP financial measure that we believe analysts, investors and other stakeholders consider useful to allow for comparability to peers and of the period-to-period use of our equity. The calculation of tangible common equity represents common shareholders’ equity less goodwill and intangible assets net of allowable mortgage servicing rights deduction. In addition, we believe that certain ratios that utilize tangible common equity, such as return on average tangible common equity (“ROTCE”) and tangible book value per common share, also non-GAAP financial measures, are useful for evaluating the operating performance and capital adequacy of the business period-to-period, respectively. The calculation of ROTCE represents annualized earnings applicable to Morgan Stanley common shareholders as a percentage of average tangible common equity. The calculation of tangible book value per common share represents tangible common equity divided by common shares outstanding.

The principal non-GAAP financial measures presented in this document are set forth in the following tables.

Reconciliations from U.S. GAAP to Non-GAAP Consolidated Financial Measures

						Three Months Ended March 31,
$ in millions									2024			2023
Net revenues									$	15,136		$	14,517
Adjustment for mark-to-market losses (gains) on DCP1									(187)			(153)
Adjusted Net revenues—non-GAAP									$	14,949		$	14,364
Compensation expense									$	6,696		$	6,410
Adjustment for mark-to-market gains (losses) on DCP1									(249)			(193)
Adjusted Compensation expense—non-GAAP									$	6,447		$	6,217
Wealth Management Net revenues									$	6,880		$	6,559
Adjustment for mark-to-market losses (gains) on DCP1									(140)			(101)
Adjusted Wealth Management Net revenues—non-GAAP									$	6,740		$	6,458
Wealth Management Compensation expense									$	3,788		$	3,477
Adjustment for mark-to-market gains (losses) on DCP1									(156)			(119)
Adjusted Wealth Management Compensation expense—non-GAAP									$	3,632		$	3,358

$ in millions			At March 31, 2024			At December 31, 2023
Tangible equity
Common equity			$	90,448		$	90,288
Less: Goodwill and net intangible assets			(23,635)			(23,761)
Tangible common equity—non-GAAP			$	66,813		$	66,527

									Average Monthly Balance
						Three Months Ended March 31,
$ in millions									2024			2023
Tangible equity
Common equity									$	89,913		$	91,382
Less: Goodwill and net intangible assets									(23,705)			(24,198)
Tangible common equity—non-GAAP									$	66,208		$	67,184

Non-GAAP Financial Measures by Business Segment

						Three Months Ended March 31,
$ in billions									2024			2023
Average common equity2
Institutional Securities									$	45.0		$	45.6
Wealth Management									29.1			28.8
Investment Management									10.8			10.4
ROE3
Institutional Securities									15		%	12		%
Wealth Management									19		%	19		%
Investment Management									7		%	5		%
Average tangible common equity2
Institutional Securities									$	44.6		$	45.2
Wealth Management									15.5			14.8
Investment Management									1.1			0.7
ROTCE3
Institutional Securities									15		%	12		%
Wealth Management									35		%	36		%
Investment Management									68		%	73		%

1.Net revenues and compensation expense are adjusted for DCP for both Firm and Wealth Management business segment. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Other Matters” in the 2023 Form 10-K for more information.

2.Average common equity and average tangible common equity for each business segment is determined using our Required Capital framework (see “Liquidity and Capital Resources—Regulatory Requirements—Attribution of Average Common Equity According to the Required Capital Framework” herein). The sums of the segments’ Average common equity and Average tangible common equity do not equal the Consolidated measures due to Parent Company equity.

3.The calculation of ROE and ROTCE by segment uses net income applicable to Morgan Stanley by segment less preferred dividends allocated to each segment, annualized as a percentage of average common equity and average tangible common equity, respectively, allocated to each segment.

Return on Tangible Common Equity Goal

We have an ROTCE goal of 20%. Our ROTCE goal is a forward-looking statement that is based on a normal market environment and may be materially affected by many factors.

See “Risk Factors” and “Forward-Looking Statements” in the 2023 Form 10-K for further information on market and economic conditions and their potential effects on our future operating results.

ROTCE represents a non-GAAP financial measure. For further information on non-GAAP measures, see “Selected Non-GAAP Financial Information” herein.

			8			March 2024 Form 10-Q

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Table of Contents
Management’s Discussion and Analysis

Business Segments

Substantially all of our operating revenues and operating expenses are directly attributable to our business segments. Certain revenues and expenses have been allocated to each business segment, generally in proportion to its respective net revenues, non-interest expenses or other relevant measures. See Note 19 to the financial statements for segment net revenues by income statement line item and information on intersegment transactions.

For an overview of the components of our business segments, net revenues, compensation expense and income taxes, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Business Segments” in the 2023 Form 10-K.

March 2024 Form 10-Q			9

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Table of Contents
Management’s Discussion and Analysis

Institutional Securities

Income Statement Information

			Three Months Ended March 31,						% Change
$ in millions			2024			2023
Revenues
Advisory			$	461		$	638		(28)		%
Equity			430			202			113		%
Fixed income			556			407			37		%
Total Underwriting			986			609			62		%
Total Investment banking			1,447			1,247			16		%
Equity			2,842			2,729			4		%
Fixed income			2,485			2,576			(4)		%
Other			242			245			(1)		%
Net revenues			$	7,016		$	6,797		3		%
Provision for credit losses			2			189			(99)		%
Compensation and benefits			2,343			2,365			(1)		%
Non-compensation expenses			2,320			2,351			(1)		%
Total non-interest expenses			4,663			4,716			(1)		%
Income before provision for income taxes			2,351			1,892			24		%
Provision for income taxes			482			363			33		%
Net income			1,869			1,529			22		%
Net income applicable to noncontrolling interests			50			51			(2)		%
Net income applicable to Morgan Stanley			$	1,819		$	1,478		23		%

Investment Banking

Investment Banking Volumes

						Three Months Ended March 31,
$ in billions									2024			2023
Completed mergers and acquisitions1									$	115		$	128
Equity and equity-related offerings2, 3									16			11
Fixed income offerings2, 4									95			63

Source: Refinitiv data as of April 1, 2024. Transaction volumes may not be indicative of net revenues in a given period. In addition, transaction volumes for prior periods may vary from amounts previously reported due to the subsequent withdrawal, change in value or change in timing of certain transactions.

1.Includes transactions of $100 million or more. Based on full credit to each of the advisors in a transaction.

2.Based on full credit for single book managers and equal credit for joint book managers.

3.Includes Rule 144A issuances and registered public offerings of common stock, convertible securities and rights offerings.

4.Includes Rule 144A and publicly registered issuances, non-convertible preferred stock, mortgage-backed and asset-backed securities, and taxable municipal debt. Excludes leveraged loans and self-led issuances.

Investment Banking Revenues

Revenues of $1,447 million in the current quarter increased 16% from the prior year quarter, reflecting an increase in underwriting revenues, partially offset by lower Advisory revenues.

•Advisory revenues decreased primarily due to fewer completed M&A transactions.

•Equity underwriting revenues increased on higher volumes, primarily in initial public and follow-on offerings.

•Fixed income underwriting revenues increased primarily due to higher bond issuances, securitized products revenues and investment-grade loan issuances.

While Investment Banking results improved from recent quarters on higher underwriting revenues, we continue to operate in a market environment with lower completed M&A activity.

See “Investment Banking Volumes” herein.

Equity, Fixed Income and Other Net Revenues

Equity and Fixed Income Net Revenues

			Three Months Ended March 31, 2024
									Net Interest2			All Other3
$ in millions			Trading			Fees1									Total
Financing			$	2,022		$	136		$	(891)		$	1		$	1,268
Execution services			972			609			(41)			34			1,574
Total Equity			$	2,994		$	745		$	(932)		$	35		$	2,842
Total Fixed Income			$	2,594		$	104		$	(292)		$	79		$	2,485

			Three Months Ended March 31, 2023
									Net Interest2			All Other3
$ in millions			Trading			Fees1									Total
Financing			$	1,696		$	134		$	(541)		$	32		$	1,321
Execution services			848			619			(59)			—			1,408
Total Equity			$	2,544		$	753		$	(600)		$	32		$	2,729
Total Fixed Income			$	2,478		$	109		$	(89)		$	78		$	2,576

1.Includes Commissions and fees and Asset management revenues.

2.Includes funding costs, which are allocated to the businesses based on funding usage.

3.Includes Investments and Other revenues.

Equity

Net revenues of $2,842 million in the current quarter increased 4% compared with the prior year quarter, reflecting an increase in Execution services, partially offset by a decrease in Financing.

•Financing revenues decreased primarily driven by lower gains on inventory held to facilitate client activity in Asia compared to elevated results in the prior year quarter, partially offset by the impact of higher average client balances.

•Execution services revenues increased primarily due to higher gains on inventory held to facilitate client activity in derivatives and cash equities and mark-to-market gains on business-related investments compared with losses in the prior year quarter.

			10			March 2024 Form 10-Q

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Management’s Discussion and Analysis

Fixed Income

Net revenues of $2,485 million in the current quarter decreased 4% from the prior year quarter, primarily reflecting a decrease in client activity, partially offset by an increase in certain commodities products.

•Global macro products revenues decreased primarily due to decreased client activity in foreign exchange and rates products.

•Credit products revenues decreased primarily due to lower client activity, partially offset by higher gains on inventory held to facilitate client activity.

•Commodities products and other fixed income revenues increased primarily due to higher gains on inventory held to facilitate client activity.

Other Net Revenues

Other net revenues of $242 million in the current quarter were relatively unchanged from the prior year quarter.

Provision for Credit Losses

The Provision for credit losses on loans and lending commitments of $2 million in the current quarter was primarily related to modest growth in certain loan portfolios and provisions for certain specific commercial real estate and corporate loans, partially offset by improvements in the macroeconomic outlook. The Provision for credit losses on loans and lending commitments was $189 million in the prior year quarter, primarily related to a deterioration in both the macroeconomic outlook and the commercial real estate portfolio.

For further information on the Provision for credit losses, see “Credit Risk” herein.

Non-interest Expenses

Non-interest expenses of $4,663 million in the current quarter decreased 1% compared with the prior year quarter, primarily due to lower Non-compensation expenses.

•Compensation and benefits expenses were relatively unchanged from the prior year quarter, reflecting lower stock-based compensation expense in the prior year quarter and the impact of lower headcount, offset by higher discretionary incentive compensation.

•Non-compensation expenses decreased primarily due to lower legal and professional services expenses, partially offset by higher execution-related expenses and an increased technology spend.

March 2024 Form 10-Q			11

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Management’s Discussion and Analysis

Wealth Management

Income Statement Information

			Three Months Ended March 31,						% Change
$ in millions			2024			2023
Revenues
Asset management			$	3,829		$	3,382		13		%
Transactional1			1,033			921			12		%
Net interest			1,856			2,158			(14)		%
Other1			162			98			65		%
Net revenues			6,880			6,559			5		%
Provision for credit losses			(8)			45			(118)		%
Compensation and benefits			3,788			3,477			9		%
Non-compensation expenses			1,294			1,325			(2)		%
Total non-interest expenses			5,082			4,802			6		%
Income before provision for income taxes			$	1,806		$	1,712		5		%
Provision for income taxes			403			336			20		%
Net income applicable to Morgan Stanley			$	1,403		$	1,376		2		%

1.Transactional includes Investment banking, Trading, and Commissions and fees revenues. Other includes Investments and Other revenues.

Wealth Management Metrics

$ in billions			At March 31, 2024			At December 31, 2023
Total client assets1			$	5,495		$	5,129
U.S. Bank Subsidiary loans			$	147		$	147
Margin and other lending2			$	23		$	21
Deposits3			$	347		$	346
Annualized weighted average cost of deposits4
Period end			2.96%			2.92%
Period average for three months ended			2.92%			2.86%

						Three Months Ended March 31,
									2024			2023
Net new assets									$	94.9		$	109.6

1.Client assets represent those for which Wealth Management is providing services including financial advisor-led brokerage, custody, administrative and investment advisory services; self-directed brokerage and investment advisory services; financial and wealth planning services; workplace services, including stock plan administration, and retirement plan services. See “Advisor-Led Channel” and “Self-Directed Channel” herein for additional information.

2.Margin and other lending represents margin lending arrangements, which allow customers to borrow against the value of qualifying securities and other lending which includes non‐purpose securities-based lending on non‐bank entities.

3.Deposits reflect liabilities sourced from Wealth Management clients and other sources of funding on our U.S. Bank Subsidiaries. Deposits include sweep deposit programs, savings and other deposits, and time deposits.

4.Annualized weighted average represents the total annualized weighted average cost of the various deposit products, excluding the effect of related hedging derivatives. The period end cost of deposits is based upon balances and rates as of March 31, 2024 and December 31, 2023. The period average is based on daily balances and rates for the year.

Net New Assets

NNA represent client asset inflows, inclusive of interest, dividends and asset acquisitions, less client asset outflows, and exclude the impact of business combinations/divestitures and the impact of fees and commissions. The level of NNA in a given period is influenced by a variety of factors, including macroeconomic factors that impact client investment and spending behaviors, our ability to attract and retain financial

advisors and clients, and timing of large idiosyncratic flows. Of the $95 billion of NNA during the current quarter, a little more than half related to our family office offering. Macroeconomic factors have had an impact on our NNA in recent periods. Should these factors continue, the growth rate of our NNA may be impacted.

Advisor-led Channel

$ in billions			At March 31, 2024			At December 31, 2023
Advisor-led client assets1			$	4,302		$	3,979
Fee-based client assets2			$	2,124		$	1,983
Fee-based client assets as a percentage of advisor-led client assets			49%			50%

						Three Months Ended March 31,
									2024			2023
Fee-based asset flows3									$	26.2		$	22.4

1.Advisor-led client assets represent client assets in accounts that have a Wealth Management representative assigned.

2.Fee‐based client assets represent the amount of assets in client accounts where the basis of payment for services is a fee calculated on those assets.

3.Fee-based asset flows include net new fee-based assets (including asset acquisitions), net account transfers, dividends, interest and client fees, and exclude institutional cash management related activity. For a description of the Inflows and Outflows included in Fee-based asset flows, see Fee-based client assets in the 2023 Form 10-K.

Self-directed Channel

			At March 31, 2024			At December 31, 2023
Self-directed client assets1 (in billions)			$	1,194		$	1,150
Self-directed households2 (in millions)			8.1			8.1

						Three Months Ended March 31,
									2024			2023
Daily average revenue trades (“DARTs”)3 (in thousands)									841			831

1.Self-directed client assets represent active accounts which are not advisor led. Active accounts are defined as having at least $25 in assets.

2.Self-directed households represent the total number of households that include at least one active account with self-directed assets. Individual households or participants that are engaged in one or more of our Wealth Management channels are included in each of the respective channel counts.

3.DARTs represent the total self-directed trades in a period divided by the number of trading days during that period.

Workplace Channel1

			At March 31, 2024			At December 31, 2023
Stock plan unvested assets2 (in billions)			$	457		$	416
Stock plan participants3 (in millions)			6.6			6.6

1.The workplace channel includes equity compensation solutions for companies, their executives and employees.

2.Stock plan unvested assets represent the market value of public company securities at the end of the period.

3.Stock plan participants represent total accounts with vested and/or unvested stock plan assets in the workplace channel. Individuals with accounts in multiple plans are counted as participants in each plan.

Net Revenues

Asset Management

Asset management revenues of $3,829 million in the current quarter increased 13% compared with the prior year quarter, primarily reflecting higher fee-based asset levels in the

			12			March 2024 Form 10-Q

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Management’s Discussion and Analysis

current quarter due to higher market levels and the cumulative impact of positive fee-based flows.

See “Fee-Based Client Assets Rollforwards” herein.

Transactional Revenues

Transactional revenues of $1,033 million in the current quarter increased 12% compared with the prior year quarter, primarily due to higher revenues from the distribution of structured products commensurate with equity markets and higher gains on DCP investments.

For further information on the impact of DCP, see “Selected Non-GAAP Financial Information” herein.

Net Interest

Net interest revenues of $1,856 million in the current quarter decreased 14% when compared with the prior year quarter, primarily due to changes in deposit mix, partially offset by the net effect of higher interest rates.

The level and pace of interest rate changes and other macroeconomic factors continued to impact client preferences for cash allocation to higher-yielding products and the pace of reallocation of client balances, resulting in changes in the deposit mix and associated interest expense, as well as client demand for loans. If these trends persist, net interest income may be further impacted in future periods.

Provision for Credit Losses

The Provision for credit losses on loans and lending commitments was a net release of $8 million in the current quarter as a result of improvements in the macroeconomic outlook. This was partially offset by provisions for certain specific commercial real estate loans. The Provision for credit losses on loans and lending commitments was $45 million in the prior year quarter, primarily driven by deterioration in the macroeconomic outlook.

Non-interest Expenses

Non-interest expenses of $5,082 million in the current quarter increased 6% compared with the prior year quarter, as a result of higher compensation and benefits expenses.

•Compensation and benefits expenses increased in the current quarter primarily due to an increase in the formulaic payout to Wealth Management representatives driven by higher compensable revenues and higher expenses related to amortization of deferred compensation.

•Non-compensation expenses were relatively unchanged from the prior year quarter, reflecting lower professional services and legal expenses, and lower marketing and business development costs offset by the incremental FDIC special assessment cost.

Fee-Based Client Assets Rollforwards

$ in billions			At December 31, 2023			Inflows1			Outflows2			Market Impact3			At March 31, 2024
Separately managed4			$	589		$	16		$	(13)		$	39		$	631
Unified managed			501			31			(14)			27			545
Advisor			188			9			(11)			12			198
Portfolio manager			645			32			(24)			35			688
Subtotal			$	1,923		$	88		$	(62)		$	113		$	2,062
Cash management			60			12			(10)			—			62
Total fee-based client assets			$	1,983		$	100		$	(72)		$	113		$	2,124

$ in billions			At December 31, 2022			Inflows1			Outflows2			Market Impact3			At March 31, 2023
Separately managed4			$	501		$	16		$	(7)		$	18		$	528
Unified managed			408			21			(14)			17			432
Advisor			167			9			(9)			9			176
Portfolio manager			552			26			(20)			20			578
Subtotal			$	1,628		$	72		$	(50)		$	64		$	1,714
Cash management			50			20			(15)			—			55
Total fee-based client assets			$	1,678		$	92		$	(65)		$	64		$	1,769

1.Inflows include new accounts, account transfers, deposits, dividends and interest.

2.Outflows include closed or terminated accounts, account transfers, withdrawals and client fees.

3.Market impact includes realized and unrealized gains and losses on portfolio investments.

4.Includes non-custody account values based on asset values reported on a quarter lag by third-party custodians.

Average Fee Rates1

						Three Months Ended March 31,
Fee rate in bps									2024			2023
Separately managed									12			13
Unified managed									91			93
Advisor									79			80
Portfolio manager									90			91
Subtotal									65			66
Cash management									6			6
Total fee-based client assets									63			65

1.Based on Asset management revenues related to advisory services associated with fee-based assets.

For a description of fee-based client assets in the previous tables, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Business Segments—Wealth Management Fee-Based Client Assets” in the 2023 Form 10-K.

March 2024 Form 10-Q			13

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Management’s Discussion and Analysis

Investment Management

Income Statement Information

			Three Months Ended March 31,						% Change
$ in millions			2024			2023
Revenues
Asset management and related fees			$	1,346		$	1,248		8		%
Performance-based income and other1			31			41			(24)		%
Net revenues			1,377			1,289			7		%
Compensation and benefits			565			568			(1)		%
Non-compensation expenses			571			555			3		%
Total non-interest expenses			1,136			1,123			1		%
Income before provision for income taxes			241			166			45		%
Provision for income taxes			49			30			63		%
Net income			192			136			41		%
Net income (loss) applicable to noncontrolling interests			—			2			(100)		%
Net income applicable to Morgan Stanley			$	192		$	134		43		%

1.Includes Investments, Trading, Commissions and fees, Net interest, and Other revenues.

Net Revenues

Asset Management and Related Fees

Asset management and related fees of $1,346 million in the current quarter increased 8% from the prior year quarter, primarily driven by higher average AUM on higher market levels. Additionally, there were positive long-term net flows during the current quarter.

Asset management revenues are influenced by the level, relative mix of AUM and related fee rates. While the market environment improved in the current quarter, client preferences in previous quarters have resulted in net outflows in the Equity asset class. To the extent these conditions continue, we would expect our Asset management revenue to continue to be impacted.

See “Assets under Management or Supervision” herein.

Performance-based Income and Other

Performance-based income and other revenues of $31 million in the current quarter decreased from the prior year quarter, primarily due to lower accrued carried interest in certain private funds.

Non-interest Expenses

Non-interest expenses of $1,136 million in the current quarter increased 1% from the prior year quarter, primarily due to higher Non-compensation expenses.

•Compensation and benefits expenses were relatively unchanged from the prior year quarter.

•Non-compensation expenses increased in the current quarter primarily due to higher distribution expenses on higher AUM.

Assets under Management or Supervision Rollforwards

$ in billions			At Dec 31, 2023			Inflows1			Outflows2			Market Impact3			Other4			At Mar 31, 2024
Equity			$	295		$	11		$	(16)		$	24		$	(4)		$	310
Fixed Income			171			17			(13)			1			(2)			174
Alternatives and Solutions			508			35			(24)			26			(2)			543
Long-Term AUM			$	974		$	63		$	(53)		$	51		$	(8)		$	1,027
Liquidity and Overlay Services			485			522			(531)			6			(4)			478
Total			$	1,459		$	585		$	(584)		$	57		$	(12)		$	1,505

$ in billions			At Dec 31, 2022			Inflows1			Outflows2			Market Impact3			Other4			At Mar 31, 2023
Equity			$	259		$	10		$	(12)		$	21		$	(1)		$	277
Fixed Income			173			16			(17)			4			(1)			175
Alternatives and Solutions			431			18			(16)			15			—			448
Long-Term AUM			$	863		$	44		$	(45)		$	40		$	(2)		$	900
Liquidity and Overlay Services			442			585			(568)			6			(3)			462
Total			$	1,305		$	629		$	(613)		$	46		$	(5)		$	1,362

1.Inflows represent investments or commitments from new and existing clients in new or existing investment products, including reinvestments of client dividends and increases in invested capital. Inflows exclude the impact of exchanges, whereby a client changes positions within the same asset class.

2.Outflows represent redemptions from clients’ funds, transition of funds from the committed capital period to the invested capital period and decreases in invested capital. Outflows exclude the impact of exchanges, whereby a client changes positions within the same asset class.

3.Market impact includes realized and unrealized gains and losses on portfolio investments. This excludes any funds where market impact does not impact management fees.

4.Other contains both distributions and foreign currency impact for all periods. Distributions represent decreases in invested capital due to returns of capital after the investment period of a fund. It also includes fund dividends that the client has not reinvested. Foreign currency impact reflects foreign currency changes for non-U.S. dollar dominated funds.

Average AUM

						Three Months Ended March 31,
$ in billions									2024			2023
Equity									$	302		$	271
Fixed income									172			175
Alternatives and Solutions									523			441
Long-term AUM subtotal									997			887
Liquidity and Overlay Services									482			442
Total AUM									$	1,479		$	1,329

			14			March 2024 Form 10-Q

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Management’s Discussion and Analysis

Average Fee Rates1

						Three Months Ended March 31,
Fee rate in bps									2024			2023
Equity									71			72
Fixed income									36			35
Alternatives and Solutions									29			33
Long-term AUM									43			45
Liquidity and Overlay Services									13			13
Total AUM									33			35

1.Based on Asset management revenues, net of waivers, excluding performance-based fees and other non-management fees. For certain non-U.S. funds, it includes the portion of advisory fees that the advisor collects on behalf of third-party distributors. The payment of those fees to the distributor is included in Non-compensation expenses in the income statement.

For a description of the asset classes in the previous tables, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Business Segments—Investment Management—Assets Under Management or Supervision” in the 2023 Form 10-K.

March 2024 Form 10-Q			15

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Management’s Discussion and Analysis

Supplemental Financial Information

U.S. Bank Subsidiaries

Our U.S. Bank Subsidiaries, Morgan Stanley Bank N.A. (“MSBNA”) and Morgan Stanley Private Bank, National Association (“MSPBNA”) (together, “U.S. Bank Subsidiaries”), accept deposits, provide loans to a variety of customers, including large corporate and institutional clients, as well as high to ultra-high net worth individuals, and invest in securities. Lending activity in our U.S. Bank Subsidiaries from the Institutional Securities business segment primarily includes Secured lending facilities, Commercial and Residential real estate and Corporate loans. Lending activity in our U.S. Bank Subsidiaries from the Wealth Management business segment primarily includes Securities-based lending, which allows clients to borrow money against the value of qualifying securities, and Residential real estate loans.

For a further discussion of our credit risks, see “Quantitative and Qualitative Disclosures about Risk—Credit Risk” herein. For a further discussion about loans and lending commitments, see Notes 9 and 13 to the financial statements.

U.S. Bank Subsidiaries’ Supplemental Financial Information1

$ in billions			At March 31, 2024			At December 31, 2023
Investment securities:
Available-for-sale at fair value			$	65.3		$	66.6
Held-to-maturity			50.7			51.4
Total Investment securities			$	116.0		$	118.0
Wealth Management Loans2
Residential real estate			$	61.3		$	60.3
Securities-based lending and Other3			86.1			86.2
Total, net of ACL			$	147.4		$	146.5
Institutional Securities Loans2
Corporate			$	7.9		$	10.1
Secured lending facilities			40.5			40.8
Commercial and Residential real estate			11.1			10.7
Securities-based lending and Other			4.4			4.1
Total, net of ACL			$	63.9		$	65.7
Total Assets			$	400.9		$	396.1
Deposits4			$	346.6		$	346.1

1.Amounts exclude transactions between the bank subsidiaries, as well as deposits from the Parent Company and affiliates.

2.For a further discussion of loans in the Wealth Management and Institutional Securities business segments, see “Quantitative and Qualitative Disclosures about Risk—Credit Risk” herein.

3.Other loans primarily include tailored lending. For a further discussion of Other loans, see “Quantitative and Qualitative Disclosures about Risk—Credit Risk” herein.

4.For further information on deposits, see “Liquidity and Capital Resources—Funding Management—Balance Sheet—Unsecured Financing” herein.

Accounting Development Updates

The Financial Accounting Standards Board has issued certain accounting updates that apply to us. Accounting updates not listed below were assessed and determined to be either not applicable or to not have a material impact on our financial condition or results of operations upon adoption.

We are currently evaluating the following accounting updates; however, we do not expect a material impact on our financial condition or results of operations upon adoption:

•Income Tax Disclosures. This accounting update requires disclosure of additional information in relation to income taxes, including additional disaggregation of the income tax rate reconciliation and income taxes paid. For the income tax rate reconciliation, this update requires (1) disclosure of specific categories of reconciling items; and (2) additional information for reconciling items that meet a quantitative threshold (if the effect of those reconciling items is equal to or greater than 5 percent of the amount computed by multiplying pretax income (or loss) by the applicable statutory income tax rate). For income taxes paid, this update requires disclosure of information, including (1) the amount of income taxes paid (net of refunds received) disaggregated by federal, state, and foreign taxes; and (2) the amount of income taxes paid (net of refunds received), disaggregated by individual jurisdictions in which income taxes paid (net of refunds received) is equal to or greater than 5 percent of total income taxes paid (net of refunds received). Additionally, the update requires disclosure of (1) income (or loss) before income taxes, disaggregated between domestic and foreign; and (2) income taxes disaggregated by federal, state and foreign. The accounting update is effective for annual periods beginning January 1, 2025, with early adoption permitted.

•Segment Reporting. This accounting update requires additional reportable segment disclosures on an annual and interim basis, primarily about significant segment expenses and other segment items that are regularly provided to the chief operating decision maker and included within the reported measure of segment profit or loss. This update does not change how operating segments are identified or aggregated, or how quantitative thresholds are applied to determine the reportable segments. The accounting update is effective for fiscal years beginning January 1, 2024, and interim periods within fiscal years beginning January 1, 2025, with early adoption permitted.

Critical Accounting Estimates

Our financial statements are prepared in accordance with U.S. GAAP, which requires us to make estimates and assumptions (see Note 1 to the financial statements). We believe that of our significant accounting policies (see Note 2 to the financial statements in the 2023 Form 10-K and Note 2 to the financial statements), the fair value of financial instruments, goodwill and intangible assets, legal and regulatory contingencies (see Note 14 to the financial statements in the 2023 Form 10-K and Note 13 to the financial statements) and income taxes policies involve a higher degree of judgment and complexity. For a further discussion about our critical accounting policies, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Estimates” in the 2023 Form 10-K.

			16			March 2024 Form 10-Q

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Management’s Discussion and Analysis

Liquidity and Capital Resources

Our liquidity and capital policies are established and maintained by senior management, with oversight by the Asset/Liability Management Committee and the Board. Through various risk and control committees, senior management reviews business performance relative to these policies, monitors the availability of alternative sources of financing, and oversees the liquidity, interest rate and currency sensitivity of our asset and liability position. Our Corporate Treasury department (“Treasury”), Firm Risk Committee, Asset/Liability Management Committee, and other committees and control groups assist in evaluating, monitoring and managing the impact that our business activities have on our balance sheet, liquidity and capital structure. Liquidity and capital matters are reported regularly to the Board and the Risk Committee of the Board.

Balance Sheet

We monitor and evaluate the composition and size of our balance sheet on a regular basis. Our balance sheet management process includes quarterly planning, business-specific thresholds, monitoring of business-specific usage versus key performance metrics and new business impact assessments.

We establish balance sheet thresholds at the consolidated and business segment levels. We monitor balance sheet utilization and review variances resulting from business activity and market fluctuations. On a regular basis, we review current performance versus established thresholds and assess the need to re-allocate our balance sheet based on business segment needs. We also monitor key metrics, including asset and liability size and capital usage.

Total Assets by Business Segment

			At March 31, 2024
$ in millions			IS			WM			IM			Total
Assets
Cash and cash equivalents			$	73,593		$	28,550		$	162		$	102,305
Trading assets at fair value			353,117			9,177			5,339			367,633
Investment securities			38,562			114,171			—			152,733
Securities purchased under agreements to resell			102,295			20,438			—			122,733
Securities borrowed			131,780			1,072			—			132,852
Customer and other receivables			47,665			32,489			1,485			81,639
Loans1			69,811			147,405			4			217,220
Goodwill			444			10,196			6,082			16,722
Intangible assets			35			3,306			3,573			6,914
Other assets2			15,391			11,120			1,241			27,752
Total assets			$	832,693		$	377,924		$	17,886		$	1,228,503

			At December 31, 2023
$ in millions			IS			WM			IM			Total
Assets
Cash and cash equivalents			$	72,928		$	16,172		$	132		$	89,232
Trading assets at fair value			353,841			7,962			5,271			367,074
Investment securities			39,212			115,595			—			154,807
Securities purchased under agreements to resell			90,701			20,039			—			110,740
Securities borrowed			119,823			1,268			—			121,091
Customer and other receivables			47,333			31,237			1,535			80,105
Loans1			72,110			146,526			4			218,640
Goodwill			424			10,199			6,084			16,707
Intangible assets			26			3,427			3,602			7,055
Other assets2			14,108			12,743			1,391			28,242
Total assets			$	810,506		$	365,168		$	18,019		$	1,193,693

1.Amounts include loans held for investment, net of ACL, and loans held for sale but exclude loans at fair value, which are included in Trading assets in the balance sheet (see Note 9 to the financial statements).

2.Other assets primarily includes premises, equipment and software, ROU assets related to leases, other investments, and deferred tax assets.

A substantial portion of total assets consists of cash and cash equivalents, liquid marketable securities and short-term receivables. In the Institutional Securities business segment, these arise from market-making, financing and prime brokerage activities, and in the Wealth Management business segment, these arise from banking activities, including management of the investment portfolio. Total assets of $1,229 billion at March 31, 2024 were relatively unchanged from $1,194 billion at December 31, 2023.

Liquidity Risk Management Framework

The core components of our Liquidity Risk Management Framework are the Required Liquidity Framework, Liquidity Stress Tests and Liquidity Resources, which support our target liquidity profile. For a further discussion about the Firm’s Required Liquidity Framework and Liquidity Stress Tests, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Liquidity Risk Management Framework” in the 2023 Form 10-K.

At March 31, 2024 and December 31, 2023, we maintained sufficient liquidity to meet current and contingent funding obligations as modeled in our Liquidity Stress Tests.

Liquidity Resources

We maintain sufficient liquidity resources, which consist of HQLA and cash deposits with banks (“Liquidity Resources”), to cover daily funding needs and to meet strategic liquidity targets sized by the Required Liquidity Framework and Liquidity Stress Tests. We actively manage the amount of our Liquidity Resources considering the following components: unsecured debt maturity profile; balance sheet size and composition; funding needs in a stressed environment, inclusive of contingent cash outflows; legal entity, regional and segment liquidity requirements; regulatory requirements; and collateral requirements.

March 2024 Form 10-Q			17

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Management’s Discussion and Analysis

The amount of Liquidity Resources we hold is based on our risk appetite and is calibrated to meet various internal and regulatory requirements and to fund prospective business activities. The Liquidity Resources are primarily held within the Parent Company and its major operating subsidiaries. The Total HQLA values in the tables immediately following are different from Eligible HQLA, which, in accordance with the LCR rule, also takes into account certain regulatory weightings and other operational considerations.

Liquidity Resources by Type of Investment

			Average Daily Balance Three Months Ended
$ in millions			March 31, 2024			December 31, 2023
Cash deposits with central banks			$	63,913		$	64,205
Unencumbered HQLA Securities1:
U.S. government obligations			140,628			137,635
U.S. agency and agency mortgage-backed securities			86,507			83,733
Non-U.S. sovereign obligations2			19,397			20,117
Other investment grade securities			969			678
Total HQLA1			$	311,414		$	306,368
Cash deposits with banks (non-HQLA)			7,250			8,136
Total Liquidity Resources			$	318,664		$	314,504

1.HQLA is presented prior to applying weightings and includes all HQLA held in subsidiaries.

2.Primarily composed of unencumbered French, U.K., Japanese, German, Italian and Spanish government obligations.

Liquidity Resources by Bank and Non-Bank Legal Entities

			Average Daily Balance Three Months Ended
$ in millions			March 31, 2024			December 31, 2023
Bank legal entities
U.S.			$	139,457		$	132,870
Non-U.S.			5,661			5,359
Total Bank legal entities			145,118			138,229
Non-Bank legal entities
U.S.:
Parent Company			59,420			58,494
Non-Parent Company			56,059			56,459
Total U.S.			115,479			114,953
Non-U.S.			58,067			61,322
Total Non-Bank legal entities			173,546			176,275
Total Liquidity Resources			$	318,664		$	314,504

Liquidity Resources may fluctuate from period to period based on the overall size and composition of our balance sheet, the maturity profile of our unsecured debt, and estimates of funding needs in a stressed environment, among other factors.

Regulatory Liquidity Framework

Liquidity Coverage Ratio and Net Stable Funding Ratio

We and our U.S. Bank Subsidiaries are required to maintain a minimum LCR and NSFR of 100%.

The LCR rule requires large banking organizations to have sufficient Eligible HQLA to cover net cash outflows arising

from significant stress over 30 calendar days, thus promoting the short-term resilience of the liquidity risk profile of banking organizations. In determining Eligible HQLA for LCR purposes, weightings (or asset haircuts) are applied to HQLA, and certain HQLA held in subsidiaries is excluded.

The NSFR rule requires large banking organizations to maintain an amount of available stable funding, which is their regulatory capital and liabilities subject to standardized weightings, equal to or greater than their required stable funding, which is their projected minimum funding needs, over a one-year time horizon.

As of March 31, 2024, we and our U.S. Bank Subsidiaries are compliant with the minimum LCR and NSFR requirements of 100%.

Liquidity Coverage Ratio

			Average Daily Balance Three Months Ended
$ in millions			March 31, 2024			December 31, 2023
Eligible HQLA
Cash deposits with central banks			$	58,096		$	58,047
Securities1			192,944			194,970
Total Eligible HQLA			$	251,040		$	253,017
Net cash outflows			$	200,358		$	196,488
LCR			125		%	129		%

1.Primarily includes U.S. Treasuries, U.S. agency mortgage-backed securities, sovereign bonds and investment grade corporate bonds.

Funding Management

We manage our funding in a manner that reduces the risk of disruption to our operations. We pursue a strategy of diversification of secured and unsecured funding sources (by product, investor and region) and attempt to ensure that the tenor of our liabilities equals or exceeds the expected holding period of the assets being financed. Our goal is to achieve an optimal mix of durable secured and unsecured financing.

We fund our balance sheet on a global basis through diverse sources. These sources include our equity capital, borrowings, bank notes, securities sold under agreements to repurchase, securities lending, deposits, letters of credit and lines of credit. We have active financing programs for both standard and structured products targeting global investors and currencies.

Treasury allocates interest expense to our businesses based on the tenor and interest rate profile of the assets being funded. Treasury similarly allocates interest income to businesses carrying deposit products and other liabilities across the businesses based on the characteristics of those deposits and other liabilities.

Secured Financing

For a discussion of our secured financing activities, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital

			18			March 2024 Form 10-Q

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Table of Contents
Management’s Discussion and Analysis

Resources—Funding Management—Secured Financing” in the 2023 Form 10-K.

Collateralized Financing Transactions

$ in millions			At March 31, 2024			At December 31, 2023
Securities purchased under agreements to resell and Securities borrowed			$	255,585		$	231,831
Securities sold under agreements to repurchase and Securities loaned			$	98,349		$	77,708
Securities received as collateral1			$	3,357		$	6,219

			Average Daily Balance Three Months Ended
$ in millions			March 31, 2024			December 31, 2023
Securities purchased under agreements to resell and Securities borrowed			$	228,978		$	235,928
Securities sold under agreements to repurchase and Securities loaned			$	97,495		$	87,285

1.Included within Trading assets in the balance sheet.

See “Total Assets by Business Segment” herein for additional information on the assets shown in the previous table and Note 2 to the financial statements in the 2023 Form 10-K and Note 8 to the financial statements for additional information on collateralized financing transactions.

In addition to the collateralized financing transactions shown in the previous table, we engage in financing transactions collateralized by customer-owned securities, which are segregated in accordance with regulatory requirements. Receivables under these financing transactions, primarily margin loans, are included in Customer and other receivables in the balance sheet, and payables under these financing transactions, primarily to prime brokerage customers, are included in Customer and other payables in the balance sheet. Our risk exposure on these transactions is mitigated by collateral maintenance policies and the elements of our Liquidity Risk Management Framework.

Unsecured Financing

For a discussion of our unsecured financing activities, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Funding Management—Unsecured Financing” in the 2023 Form 10-K.

Deposits

$ in millions			At March 31, 2024			At December 31, 2023
Savings and demand deposits:
Brokerage sweep deposits1			$	141,996		$	148,274
Savings and other			146,457			139,978
Total Savings and demand deposits			288,453			288,252
Time deposits2			64,041			63,552
Total3			$	352,494		$	351,804

1.Amounts represent balances swept from client brokerage accounts.

2.Our Time deposits are predominantly brokered certificates of deposit.

3.Our deposits are primarily held in U.S. offices.

Deposits are primarily sourced from our Wealth Management clients and are considered to have stable, low-cost funding characteristics relative to other sources of funding. Each category of deposits presented above has a different cost profile and clients may respond differently to changes in interest rates and other macroeconomic conditions. Total deposits in the current quarter were relatively unchanged as a result of an increase in Savings and Time Deposits offset by the continued reduction in Brokerage sweep deposits, largely due to net outflows to alternative cash equivalent and other investment products.

Borrowings by Maturity at March 31, 20241

$ in millions			Parent Company			Subsidiaries			Total
Original maturities of one year or less			$	—		$	5,233		$	5,233
Original maturities greater than one year
2024			$	6,433		$	6,755		$	13,188
2025			20,183			14,023			34,206
2026			24,314			11,429			35,743
2027			20,603			7,506			28,109
2028			11,245			10,366			21,611
Thereafter			98,284			35,009			133,293
Total greater than one year			$	181,062		$	85,088		$	266,150
Total			$	181,062		$	90,321		$	271,383
Maturities over next 12 months2									$	19,701

1.Original maturity in the table is generally based on contractual final maturity. For borrowings with put options, maturity represents the earliest put date.

2.Includes only borrowings with original maturities greater than one year.

Borrowings of $271 billion as of March 31, 2024 increased when compared with $264 billion at December 31, 2023 primarily due to issuances net of maturities and redemptions.

We believe that accessing debt investors through multiple distribution channels helps provide consistent access to the unsecured markets. In addition, the issuance of borrowings with original maturities greater than one year allows us to reduce reliance on short-term credit-sensitive instruments. Borrowings with original maturities greater than one year are generally managed to achieve staggered maturities, thereby mitigating refinancing risk, and to maximize investor diversification through sales to global institutional and retail clients across regions, currencies and product types.

The availability and cost of financing to us can vary depending on market conditions, the volume of certain trading and lending activities, our credit ratings and the overall

March 2024 Form 10-Q			19

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Management’s Discussion and Analysis

availability of credit. We also engage in, and may continue to engage in, repurchases of our borrowings as part of our market-making activities.

For further information on Borrowings, see Note 12 to the financial statements.

Credit Ratings

We rely on external sources to finance a significant portion of our daily operations. Our credit ratings are one of the factors in the cost and availability of financing and can have an impact on certain trading revenues, particularly in those businesses where longer-term counterparty performance is a key consideration, such as certain OTC derivative transactions. When determining credit ratings, rating agencies consider both company-specific and industry-wide factors. See also “Risk Factors—Liquidity Risk” in the 2023 Form 10-K.

Parent Company and U.S. Bank Subsidiaries Issuer Ratings at April 30, 2024

			Parent Company
			Short-Term Debt			Long-Term Debt			Rating Outlook
DBRS, Inc.			R-1 (middle)			A (high)			Stable
Fitch Ratings, Inc.			F1			A+			Stable
Moody’s Investors Service, Inc.			P-1			A1			Stable
Rating and Investment Information, Inc.			a-1			A+			Stable
S&P Global Ratings			A-2			A-			Stable

			MSBNA
			Short-Term Debt			Long-Term Debt			Rating Outlook
Fitch Ratings, Inc.			F1+			AA-			Stable
Moody’s Investors Service, Inc.			P-1			Aa3			Stable
S&P Global Ratings			A-1			A+			Stable

			MSPBNA
			Short-Term Debt			Long-Term Debt			Rating Outlook
Moody’s Investors Service, Inc.			P-1			Aa3			Stable
S&P Global Ratings			A-1			A+			Stable

Incremental Collateral or Terminating Payments

In connection with certain OTC derivatives and certain other agreements where we are a liquidity provider to certain financing vehicles associated with the Institutional Securities business segment, we may be required to provide additional collateral, immediately settle any outstanding liability balances with certain counterparties or pledge additional collateral to certain clearing organizations in the event of a future credit rating downgrade irrespective of whether we are in a net asset or net liability position. See Note 6 to the financial statements for additional information on OTC derivatives that contain such contingent features.

While certain aspects of a credit rating downgrade are quantifiable pursuant to contractual provisions, the impact it would have on our business and results of operations in future periods is inherently uncertain and would depend on a number

of interrelated factors, including, among other things, the magnitude of the downgrade, the rating relative to peers, the rating assigned by the relevant agency before the downgrade, individual client behavior and future mitigating actions we might take. The liquidity impact of additional collateral requirements is included in our Liquidity Stress Tests.

Capital Management

We view capital as an important source of financial strength and actively manage our consolidated capital position based upon, among other things, business opportunities, risks, capital availability and rates of return together with internal capital policies, regulatory requirements and rating agency guidelines. In the future, we may expand or contract our capital base to address the changing needs of our businesses.

Common Stock Repurchases

						Three Months Ended March 31,
in millions, except for per share data									2024			2023
Number of shares									12			16
Average price per share									$	86.79		$	95.16
Total									$	1,000		$	1,500

For additional information on our common stock repurchases, see “Liquidity and Capital Resources—Regulatory Requirements—Capital Plans, Stress Tests and the Stress Capital Buffer” herein and Note 16 to the financial statements.

For a description of our capital plan, see “Liquidity and Capital Resources—Regulatory Requirements—Capital Plans, Stress Tests and the Stress Capital Buffer” herein.

Common Stock Dividend Announcement

Announcement date			April 16, 2024
Amount per share			$0.85
Date to be paid			May 15, 2024
Shareholders of record as of			April 30, 2024

For additional information on our common stock dividends, see “Liquidity and Capital Resources—Regulatory Requirements—Capital Plans, Stress Tests and the Stress Capital Buffer” herein.

For additional information on our common stock and information on our preferred stock, see Note 16 to the financial statements.

Off-Balance Sheet Arrangements

We enter into various off-balance sheet arrangements, including through unconsolidated SPEs and lending-related financial instruments (e.g., guarantees and commitments), primarily in connection with the Institutional Securities and Investment Management business segments.

We utilize SPEs primarily in connection with securitization activities. For information on our securitization activities, see Note 15 to the financial statements in the 2023 Form 10-K.

			20			March 2024 Form 10-Q

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Management’s Discussion and Analysis

For information on our commitments, obligations under certain guarantee arrangements and indemnities, see Note 13 to the financial statements. For a further discussion of our lending commitments, see “Quantitative and Qualitative Disclosures about Risk—Credit Risk—Loans and Lending Commitments” herein.

Regulatory Requirements

Regulatory Capital Framework

We are a financial holding company (“FHC”) under the Bank Holding Company Act of 1956, as amended (“BHC Act”) and are subject to the regulation and oversight of the Federal Reserve. The Federal Reserve establishes capital requirements for us, including “well-capitalized” standards, and evaluates our compliance with such capital requirements. The OCC establishes similar capital requirements and standards for our U.S. Bank Subsidiaries. The regulatory capital requirements are largely based on the Basel III capital standards established by the Basel Committee and also implement certain provisions of the Dodd-Frank Act. For us to remain an FHC, we must remain well-capitalized in accordance with standards established by the Federal Reserve, and our U.S. Bank Subsidiaries must remain well-capitalized in accordance with standards established by the OCC. In addition, many of our regulated subsidiaries are subject to regulatory capital requirements, including regulated subsidiaries registered as swap dealers with the CFTC or conditionally registered as security-based swap dealers with the SEC or registered as broker-dealers or futures commission merchants. For additional information on regulatory capital requirements for our U.S. Bank Subsidiaries, as well as our subsidiaries that are swap entities, see Note 15 to the financial statements.

Regulatory Capital Requirements

We are required to maintain minimum risk-based and leverage-based capital and TLAC ratios. For more information, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Regulatory Capital Requirements” in the 2023 Form 10-K. For additional information on TLAC, see “Total Loss-Absorbing Capacity, Long-Term Debt and Clean Holding Company Requirements” herein.

Risk-Based Regulatory Capital. Risk-based capital ratio requirements apply to Common Equity Tier 1 (“CET1”) capital, Tier 1 capital and Total capital (which includes Tier 2 capital), each as a percentage of RWA, and consist of regulatory minimum required ratios plus our capital buffer requirement. Capital requirements require certain adjustments to, and deductions from, capital for purposes of determining these ratios.

Risk-Based Regulatory Capital Ratio Requirements

			At March 31, 2024 and December 31, 2023
			Standardized			Advanced
Capital buffers
Capital conservation buffer			—			2.5%
SCB1			5.4%			N/A
G-SIB capital surcharge2			3.0%			3.0%
CCyB3			0%			0%
Capital buffer requirement			8.4%			5.5%

1.For additional information on the SCB, see “Capital Plans, Stress Tests and the Stress Capital Buffer” herein and in the 2023 Form 10-K.

2.For a further discussion of the G-SIB capital surcharge, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Regulatory Requirements—G-SIB Capital Surcharge” in the 2023 Form 10-K.

3.The CCyB can be set up to 2.5%, but is currently set by the Federal Reserve at zero.

The capital buffer requirement represents the amount of CET1 capital we must maintain above the minimum risk-based capital requirements in order to avoid restrictions on our ability to make capital distributions, including the payment of dividends and the repurchase of stock, and to pay discretionary bonuses to executive officers. Our capital buffer requirement computed under the standardized approaches for calculating credit risk and market RWAs (“Standardized Approach”) is equal to the sum of our SCB, G-SIB capital surcharge and CCyB, and our capital buffer requirement computed under the applicable advanced approaches for calculating credit risk, market risk and operational risk RWAs (“Advanced Approach”) is equal to our 2.5% capital conservation buffer, G-SIB capital surcharge and CCyB.

			Regulatory Minimum			At March 31, 2024 and December 31, 2023
						Standardized			Advanced
Required ratios1
CET1 capital ratio			4.5		%	12.9%			10.0%
Tier 1 capital ratio			6.0		%	14.4%			11.5%
Total capital ratio			8.0		%	16.4%			13.5%

1.Required ratios represent the regulatory minimum plus the capital buffer requirement.

Our risk-based capital ratios are computed under each of (i) the Standardized Approach and (ii) the Advanced Approach. The credit risk RWA calculations between the two approaches differ in that the Standardized Approach requires calculation of RWA using prescribed risk weights and exposure methodologies, whereas the Advanced Approach utilizes models to calculate exposure amounts and risk weights. At March 31, 2024 and December 31, 2023, the differences between the actual and required ratios were lower under the Standardized Approach.

Leverage-Based Regulatory Capital. Leverage-based capital requirements include a minimum Tier 1 leverage ratio of 4%, a minimum SLR of 3% and an enhanced SLR capital buffer of at least 2%.

CECL Deferral. Beginning on January 1, 2020, we elected to defer the effect of the adoption of CECL on our risk-based and leverage-based capital amounts and ratios, as well as our

March 2024 Form 10-Q			21

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Management’s Discussion and Analysis

RWA, adjusted average assets and supplementary leverage exposure calculations, over a five-year transition period. The deferral impacts began to phase in at 25% per year from January 1, 2022 and are phased-in at 75% from January 1, 2024. The deferral impacts will become fully phased-in beginning on January 1, 2025.

Regulatory Capital Ratios

Risk-based capital

			Standardized									Advanced
$ in millions			At March 31, 2024			At Dec 31, 2023						At March 31, 2024			At Dec 31, 2023
Risk-based capital
CET1 capital			$	70,298		$	69,448					$	70,298		$	69,448
Tier 1 capital			79,046			78,183						79,046			78,183
Total capital			91,007			88,874						90,239			88,190
Total RWA			467,763			456,053						456,511			448,154
Risk-based capital ratios
CET1 capital			15.0		%	15.2		%				15.4		%	15.5		%
Tier 1 capital			16.9		%	17.1		%				17.3		%	17.4		%
Total capital			19.5		%	19.5		%				19.8		%	19.7		%
Required ratios1
CET1 capital			12.9		%	12.9		%				10.0		%	10.0		%
Tier 1 capital			14.4		%	14.4		%				11.5		%	11.5		%
Total capital			16.4		%	16.4		%				13.5		%	13.5		%

1.Required ratios are inclusive of any buffers applicable as of the date presented.

Leveraged-based capital

$ in millions			At March 31, 2024			At December 31, 2023
Leveraged-based capital
Adjusted average assets1			$	1,178,369		$	1,159,626
Supplementary leverage exposure2			1,464,030			1,429,552
Leveraged-based capital ratios
Tier 1 leverage			6.7		%	6.7		%
SLR			5.4		%	5.5		%
Required ratios3
Tier 1 leverage			4.0		%	4.0		%
SLR			5.0		%	5.0		%

1.Adjusted average assets represents the denominator of the Tier 1 leverage ratio and is composed of the average daily balance of consolidated on-balance sheet assets for the quarters ending on the respective balance sheet dates, reduced by disallowed goodwill, intangible assets, investments in covered funds, defined benefit pension plan assets, after-tax gain on sale from assets sold into securitizations, investments in our own capital instruments, certain deferred tax assets and other capital deductions.

2.Supplementary leverage exposure is the sum of Adjusted average assets used in the Tier 1 leverage ratio and other adjustments, primarily: (i) for derivatives, potential future exposure and the effective notional principal amount of sold credit protection offset by qualifying purchased credit protection; (ii) the counterparty credit risk for repo-style transactions; and (iii) the credit equivalent amount for off-balance sheet exposures.

3.Required ratios are inclusive of any buffers applicable as of the date presented.

Regulatory Capital

$ in millions			At March 31, 2024			At December 31, 2023			Change
CET1 capital
Common shareholders' equity			$	90,448		$	90,288		$	160
Regulatory adjustments and deductions
Net goodwill			(16,392)			(16,394)			2
Net intangible assets			(5,394)			(5,509)			115
Impact of CECL transition			62			124			(62)
Other adjustments and deductions1			1,574			939			635
Total CET1 capital			$	70,298		$	69,448		$	850
Additional Tier 1 capital
Preferred stock			$	8,750		$	8,750		$	—
Noncontrolling interests			756			758			(2)
Additional Tier 1 capital			$	9,506		$	9,508		$	(2)
Deduction for investments in covered funds			(758)			(773)			15
Total Tier 1 capital			$	79,046		$	78,183		$	863
Standardized Tier 2 capital
Subordinated debt			$	10,032		$	8,760		$	1,272
Eligible ACL			2,090			2,051			39
Other adjustments and deductions			(161)			(120)			(41)
Total Standardized Tier 2 capital			$	11,961		$	10,691		$	1,270
Total Standardized capital			$	91,007		$	88,874		$	2,133
Advanced Tier 2 capital
Subordinated debt			$	10,032		$	8,760		$	1,272
Eligible credit reserves			1,322			1,367			(45)
Other adjustments and deductions			(161)			(120)			(41)
Total Advanced Tier 2 capital			$	11,193		$	10,007		$	1,186
Total Advanced capital			$	90,239		$	88,190		$	2,049

1.Other adjustments and deductions used in the calculation of Common Equity Tier 1 capital primarily includes net after-tax DVA, the credit spread premium over risk-free rate for derivative liabilities, defined benefit pension plan assets, after-tax gain on sale from assets sold into securitizations, investments in our own capital instruments and certain deferred tax assets.

			22			March 2024 Form 10-Q

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Management’s Discussion and Analysis

RWA Rollforward

			Three Months Ended March 31, 2024
$ in millions			Standardized			Advanced
Credit risk RWA
Balance at December 31, 2023			$	407,731		$	297,858
Change related to the following items:
Derivatives			1,072			(4,757)
Securities financing transactions			4,273			288
Investment securities			(578)			(1,307)
Commitments, guarantees and loans			373			7,051
Equity investments			(22)			(241)
Other credit risk			3,205			3,508
Total change in credit risk RWA			$	8,323		$	4,542
Balance at March 31, 2024			$	416,054		$	302,400
Market risk RWA
Balance at December 31, 2023			$	48,322		$	48,201
Change related to the following items:
Regulatory VaR			1,336			1,336
Regulatory stressed VaR			(738)			(738)
Incremental risk charge			1,047			1,047
Comprehensive risk measure			81			202
Specific risk			1,661			1,661
Total change in market risk RWA			$	3,387		$	3,508
Balance at March 31, 2024			$	51,709		$	51,709
Operational risk RWA
Balance at December 31, 2023			N/A			$	102,095
Change in operational risk RWA			N/A			307
Balance at March 31, 2024			N/A			$	102,402
Total RWA			$	467,763		$	456,511

Regulatory VaR—VaR for regulatory capital requirements

In the current quarter, Credit risk RWA increased under both the Standardized and Advanced Approaches. Under the Standardized Approach, the increase was primarily due to higher securities financing transactions, increase in Other credit risk driven by higher securitizations, and increased exposure in equity derivatives. Under the Advanced Approach, the increase was primarily due to growth in Corporate lending and increase in Other credit risk driven by securitizations, partially offset by decreased exposure in foreign exchange derivatives.

Market risk RWA increased in the current quarter under both the Standardized and Advanced Approaches, primarily driven by higher Specific risk charges on non-securitization standardized charges, higher Regulatory VaR, and increase in Incremental risk charges.

Operational risk RWA in the current quarter remained relatively unchanged.

Total Loss-Absorbing Capacity, Long-Term Debt and Clean Holding Company Requirements

The Federal Reserve has established external TLAC, long-term debt (“LTD”) and clean holding company requirements for top-tier BHCs of U.S. G-SIBs (“covered BHCs”), including the Parent Company. These requirements are designed to ensure that covered BHCs will have enough loss-absorbing resources at the point of failure to be recapitalized

through the conversion of eligible LTD to equity or otherwise by imposing losses on eligible LTD or other forms of TLAC where an SPOE resolution strategy is used.

Required and Actual TLAC and Eligible LTD Ratios

									Actual Amount/Ratio
$ in millions			Regulatory Minimum			Required Ratio1			At March 31, 2024			At December 31, 2023
External TLAC2									$	257,108		$	250,914
External TLAC as a % of RWA			18.0		%	21.5		%	55.0		%	55.0		%
External TLAC as a % of leverage exposure			7.5		%	9.5		%	17.6		%	17.6		%
Eligible LTD3									$	167,788		$	162,547
Eligible LTD as a % of RWA			9.0		%	9.0		%	35.9		%	35.6		%
Eligible LTD as a % of leverage exposure			4.5		%	4.5		%	11.5		%	11.4		%

1.Required ratios are inclusive of applicable buffers.

2.External TLAC consists of Common Equity Tier 1 capital and Additional Tier 1 capital (each excluding any noncontrolling minority interests), as well as eligible LTD.

3.Consists of TLAC-eligible LTD reduced by 50% for amounts of unpaid principal due to be paid in more than one year but less than two years from each respective balance sheet date.

We are in compliance with all TLAC requirements as of March 31, 2024 and December 31, 2023.

For a further discussion of TLAC and related requirements, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Regulatory Requirements—Total Loss-Absorbing Capacity, Long-Term Debt and Clean Holding Company Requirements” in the 2023 Form 10-K.

Capital Plans, Stress Tests and the Stress Capital Buffer

The Federal Reserve has capital planning and stress test requirements for large BHCs, which form part of the Federal Reserve’s annual CCAR framework.

We must submit, on at least an annual basis, a capital plan to the Federal Reserve, taking into account the results of separate annual stress tests designed by us and the Federal Reserve, so that the Federal Reserve may assess our systems and processes that incorporate forward-looking projections of revenues and losses to monitor and maintain our internal capital adequacy. As banks with less than $250 billion of total assets, our U.S. Bank Subsidiaries are not subject to company-run stress test regulatory requirements.

As part of its annual capital supervisory stress testing process, the Federal Reserve determines an SCB for each large BHC, including us.

Our SCB will remain at 5.4% through September 30, 2024. Together with other features of the regulatory capital framework, this SCB results in an aggregate Standardized Approach Common Equity Tier 1 required ratio of 12.9%.

For the 2024 capital planning and stress test cycle, we submitted our capital plan and company-run stress test results to the Federal Reserve on April 5, 2024. The Federal Reserve

March 2024 Form 10-Q			23

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Management’s Discussion and Analysis

is expected to publish summary results of the CCAR and Dodd-Frank Act supervisory stress tests of each large BHC, including us, by June 30, 2024. We are required to disclose a summary of the results of our company-run stress tests within 15 days of the date the Federal Reserve discloses the results of the supervisory stress tests.

For additional information, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Regulatory Requirements—Capital Plans, Stress Tests and the Stress Capital Buffer” in the 2023 Form 10-K.

Attribution of Average Common Equity According to the Required Capital Framework

Our required capital (“Required Capital”) estimation is based on the Required Capital framework, an internal capital adequacy measure. Common equity attribution to the business segments is based on capital usage calculated under the Required Capital framework, as well as each business segment’s relative contribution to our total Required Capital.

The Required Capital framework is a risk-based and leverage-based capital measure, which is compared with our regulatory capital to ensure that we maintain an amount of going concern capital after absorbing potential losses from stress events, where applicable, at a point in time. The amount of capital allocated to the business segments is generally set at the beginning of each year and remains fixed throughout the year until the next annual reset unless a significant business change occurs (e.g., acquisition or disposition). We define the difference between our total average common equity and the sum of the average common equity amounts allocated to our business segments as Parent Company common equity. We generally hold Parent Company common equity for prospective regulatory requirements, organic growth, potential future acquisitions and other capital needs.

Average Common Equity Attribution under the Required Capital Framework1

			Three Months Ended March 31,
$ in billions			2024			2023
Institutional Securities			$	45.0		$	45.6
Wealth Management			29.1			28.8
Investment Management			10.8			10.4
Parent Company			5.0			6.6
Total			$	89.9		$	91.4

1.The attribution of average common equity to the business segments is a non-GAAP financial measure. See “Selected Non-GAAP Financial Information” herein.

We continue to evaluate our Required Capital framework with respect to the impact of evolving regulatory requirements, as appropriate.

Resolution and Recovery Planning

We are required to submit once every two years to the Federal Reserve and the FDIC (“Agencies”) a resolution plan that

describes our strategy for a rapid and orderly resolution under the U.S. Bankruptcy Code in the event of our material financial distress or failure. We submitted our 2023 full resolution plan on June 30, 2023.

As described in our most recent resolution plan, our preferred resolution strategy is an SPOE strategy. In line with our SPOE strategy, the Parent Company has transferred, and has agreed to transfer on an ongoing basis, certain assets to its wholly owned, direct subsidiary Morgan Stanley Holdings LLC (the “Funding IHC”). In addition, the Parent Company has entered into an amended and restated support agreement with its material entities (including the Funding IHC) and certain other subsidiaries. In the event of a resolution scenario, the Parent Company would be obligated to contribute all of its contributable assets to our supported entities and/or the Funding IHC. The Funding IHC would be obligated to provide capital and liquidity, as applicable, to our supported entities. The combined implication of the SPOE resolution strategy and the requirement to maintain certain levels of TLAC is that losses in resolution would be imposed on the holders of eligible LTD and other forms of eligible TLAC issued by the Parent Company before any losses are imposed on creditors of our supported entities and without requiring taxpayer or government financial support.

For more information about resolution and recovery planning requirements and our activities in these areas, including the implications of such activities in a resolution scenario, see “Business—Supervision and Regulation—Financial Holding Company—Resolution and Recovery Planning,” “Risk Factors—Legal, Regulatory and Compliance Risk” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Regulatory Requirements—Resolution and Recovery Planning” in the 2023 Form 10-K.

			24			March 2024 Form 10-Q

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Management’s Discussion and Analysis

Regulatory Developments and Other Matters

FDIC Final Rulemaking on Special Assessment

Following the failures of certain banks and resulting losses to the FDIC’s Deposit Insurance Fund in the first half of 2023, the FDIC adopted a final rule on November 16, 2023 to implement a special assessment to recover the cost associated with protecting uninsured depositors. Under the final rule, the assessment base for the special assessment is equal to an IDI’s estimated uninsured deposits reported as of December 31, 2022, adjusted to exclude the first $5 billion of uninsured deposits. The $5 billion exclusion is applied once to the aggregate uninsured deposits of our U.S. Bank Subsidiaries. The final rule provides that, starting in 2024, the FDIC will collect the special assessment at a quarterly rate of 3.36 basis points over eight quarterly assessment periods, subject to change depending on any adjustments to the loss estimate, mergers, failures, or amendments to reported estimates of uninsured deposits. We recorded the cost of the special assessment of $286 million in Non-interest expenses when the final rule was published in the Federal Register, in the fourth quarter of 2023. We recorded the incremental estimated cost of $42 million during the first quarter based on the February notification received from the FDIC which contained the revised estimated losses as well as the estimated recoveries from its receivership residual interests from those bank failures.

Basel III Endgame and G-SIB Surcharge Proposals

On July 27, 2023, U.S. banking agencies proposed revisions to risk-based capital and related standards applicable to us and our U.S. Bank Subsidiaries (“Basel III Endgame Proposal”). For more information on the Basel III Endgame Proposal, as well as the proposed revisions to the G-SIB capital surcharge framework, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Regulatory Developments and Other Matters” in the 2023 Form 10-K.

March 2024 Form 10-Q			25

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Quantitative and Qualitative Disclosures about Risk

Management believes effective risk management is vital to the success of our business activities. For a discussion of our Enterprise Risk Management framework and risk management functions, see “Quantitative and Qualitative Disclosures about Risk—Risk Management” in the 2023 Form 10-K.

Market Risk

Market risk refers to the risk that a change in the level of one or more market prices, rates, spreads, indices, volatilities, correlations or other market factors, such as market liquidity, will result in losses for a position or portfolio. Generally, we incur market risk as a result of trading, investing and client facilitation activities, principally within the Institutional Securities business segment where the substantial majority of our VaR for market risk exposures is generated. In addition, we incur non-trading market risk, principally within the Wealth Management and Investment Management business segments. The Wealth Management business segment primarily incurs non-trading market risk (including interest rate risk) from lending and deposit-taking activities. The Investment Management business segment primarily incurs non-trading market risk from capital investments in its funds. For a further discussion of market risk, see “Quantitative and Qualitative Disclosures about Risk—Market Risk” in the 2023 Form 10-K.

Trading Risks

We have exposures to a wide range of risks related to interest rates and credit spreads, equity prices, foreign exchange rates and commodity prices as well as the associated implied volatilities, correlations and spreads of the global markets in which we conduct our trading activities.

The statistical technique known as VaR is one of the tools we use to measure, monitor and review the market risk exposures of our trading portfolios.

For information regarding our primary risk exposures and market risk management, VaR methodology, assumptions and limitations, see “Quantitative and Qualitative Disclosures about Risk—Market Risk—Trading Risks” in the 2023 Form 10-K.

95%/One-Day Management VaR for the Trading Portfolio

			Three Months Ended
			March 31, 2024
$ in millions			Period End			Average			High1			Low1
Interest rate and credit spread			$	40		$	40		$	52		$	27
Equity price			23			21			24			17
Foreign exchange rate			8			9			15			6
Commodity price			18			13			18			10
Less: Diversification benefit2			(36)			(35)			N/A			N/A
Primary Risk Categories			$	53		$	48		$	58		$	38
Credit Portfolio			25			24			25			22
Less: Diversification benefit2			(18)			(18)			N/A			N/A
Total Management VaR			$	60		$	54		$	62		$	43

			Three Months Ended
			December 31, 2023
$ in millions			Period End			Average			High1			Low1
Interest rate and credit spread			$	29		$	31		$	39		$	27
Equity price			19			22			38			15
Foreign exchange rate			6			7			14			5
Commodity price			11			13			20			10
Less: Diversification benefit2			(27)			(35)			N/A			N/A
Primary Risk Categories			$	38		$	38		$	45		$	33
Credit Portfolio			25			22			25			19
Less: Diversification benefit2			(22)			(14)			N/A			N/A
Total Management VaR			$	41		$	46		$	54		$	41

1.The high and low VaR values for the Total Management VaR and each of the component VaRs might have occurred on different days during the quarter, and, therefore, the diversification benefit is not an applicable measure.

2.Diversification benefit equals the difference between the total VaR and the sum of the component VaRs. This benefit arises because the simulated one-day losses for each of the components occur on different days. Similar diversification benefits are also are taken into account within each component.

Average Total Management VaR and average Management VaR for the Primary Risk Categories increased from the three months ended December 31, 2023, primarily driven by increased exposure in the interest rate and credit spread risk category.

Distribution of VaR Statistics and Net Revenues

We evaluate the reasonableness of our VaR model by comparing the potential declines in portfolio values generated by the model with corresponding actual trading results for the Firm, as well as individual business units. For days where losses exceed the VaR statistic, we examine the drivers of trading losses to evaluate the VaR model’s accuracy. There were 2 trading loss days in the current quarter, none of which exceeded 95% Total Management VaR.

			26			March 2024 Form 10-Q

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Risk Disclosures

Daily 95%/One-Day Total Management VaR for the Current Quarter

($ in millions)

Daily Net Trading Revenues for the Current Quarter

($ in millions)

Daily net trading revenues include profits and losses from Interest rate and credit spread, Equity price, Foreign exchange rate, Commodity price, and Credit Portfolio positions and intraday trading activities for our trading businesses. Certain items such as fees, commissions, net interest income and counterparty default risk are excluded from daily net trading revenues and the VaR model. Revenues required for Regulatory VaR backtesting further exclude intraday trading.

Non-Trading Risks

We believe that sensitivity analysis is an appropriate representation of our non-trading risks. The following sensitivity analyses cover substantially all of the non-trading risk in our portfolio.

Credit Spread Risk Sensitivity1

$ in millions			At March 31, 2024			At December 31, 2023
Derivatives			$	5		$	6
Borrowings carried at fair value			49			48

1.Amounts represent the potential gain for each 1 bps widening of our credit spread.

The Wealth Management business segment reflects a substantial portion of our non-trading interest rate risk. Net interest income in the Wealth Management business segment primarily consists of interest income earned on non-trading assets held, including loans and investment securities, as well as margin and other lending on non-bank entities and interest expense incurred on non-trading liabilities, primarily deposits.

Wealth Management Net Interest Income Sensitivity Analysis

$ in millions			At March 31, 2024			At December 31, 2023
Basis point change
+100			$	561		$	585
-100			(590)			(609)

The previous table presents an analysis of selected instantaneous upward and downward parallel interest rate shocks (subject to a floor of zero percent in the downward scenario) on net interest income over the next 12 months for our Wealth Management business segment. These shocks are applied to our 12-month forecast for our Wealth Management business segment, which incorporates market expectations of interest rates, our forecasted business activity and deposit forecasts, which include assumptions around client behavior.

We do not manage to any single rate scenario but rather manage net interest income in our Wealth Management business segment across a range of possible outcomes, including non-parallel rate change scenarios. The sensitivity analysis assumes that we take no action in response to these scenarios, assumes there are no changes in other macroeconomic variables normally correlated with changes in interest rates and includes subjective assumptions regarding customer and market re-pricing behavior and other factors.

Our Wealth Management business segment balance sheet is asset sensitive, given assets reprice faster than liabilities, resulting in higher net interest income in increasing interest rate scenarios. The level of interest rates may impact the amount of deposits held at the Firm, given competition for deposits from other institutions and alternative cash-equivalent products available to depositors. Further, the level of interest rates could also impact client demand for loans.

March 2024 Form 10-Q			27

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Risk Disclosures

Net interest income sensitivity to interest rates at March 31, 2024 was relatively unchanged from December 31, 2023.

Investments Sensitivity, Including Related Carried Interest

			Loss from 10% Decline
$ in millions			At March 31, 2024			At December 31, 2023
Investments related to Investment Management activities			$	528		$	481
Other investments:
MUMSS			129			134
Other Firm investments			408			399

We have exposure to public and private companies through direct investments, as well as through funds that invest in these assets. These investments are predominantly equity positions with long investment horizons, a portion of which is for business facilitation purposes. The market risk related to these investments is measured by estimating the potential reduction in net revenues associated with a reasonably possible 10% decline in investment values and related impact on performance-based income, as applicable.

Investments sensitivity changed between March 31, 2024 and December 31. 2023. Investment sensitivity increased due to new investments in public funds within the Investment Management segment.

Asset Management Revenue Sensitivity

Certain asset management revenues in the Wealth Management and Investment Management business segments are derived from management fees, which are based on fee-based client assets in Wealth Management or AUM in Investment Management (together, “client holdings”). The assets underlying client holdings are primarily composed of equity, fixed income and alternative investments and are sensitive to changes in related markets. These revenues depend on multiple factors including, but not limited to, the level and duration of a market increase or decline, price volatility, the geographic and industry mix of client assets, and client behavior such as the rate and magnitude of client investments and redemptions. Therefore, overall revenues may not correlate completely with changes in the related markets.

Credit Risk

Credit risk refers to the risk of loss arising when a borrower, counterparty or issuer does not meet its financial obligations to us. We are primarily exposed to credit risk from institutions and individuals through our Institutional Securities and Wealth Management business segments. For a further discussion of our credit risks, see “Quantitative and Qualitative Disclosures about Risk—Credit Risk” in the 2023 Form 10-K.

Loans and Lending Commitments

			At March 31, 2024
$ in millions			HFI			HFS			FVO1			Total
Institutional Securities:
Corporate			$	7,171		$	9,655		$	—		$	16,826
Secured lending facilities			38,692			3,564			—			42,256
Commercial and Residential real estate			8,689			205			4,479			13,373
Securities-based lending and Other			2,687			—			4,985			7,672
Total Institutional Securities			57,239			13,424			9,464			80,127
Wealth Management:
Residential real estate			61,339			2			—			61,341
Securities-based lending and Other			86,353			—			—			86,353
Total Wealth Management			147,692			2			—			147,694
Total Investment Management2			4			—			461			465
Total loans			204,935			13,426			9,925			228,286
ACL			(1,141)									(1,141)
Total loans, net of ACL			$	203,794		$	13,426		$	9,925		$	227,145
Lending commitments3			$	134,938		$	22,148		$	600		$	157,686
Total exposure			$	338,732		$	35,574		$	10,525		$	384,831

			At December 31, 2023
$ in millions			HFI			HFS			FVO1			Total
Institutional Securities:
Corporate			$	6,758		$	11,862		$	—		$	18,620
Secured lending facilities			39,498			3,161			—			42,659
Commercial and Residential real estate			8,678			209			3,331			12,218
Securities-based lending and Other			2,818			—			4,402			7,220
Total Institutional Securities			57,752			15,232			7,733			80,717
Wealth Management:
Residential real estate			60,375			22			—			60,397
Securities-based lending and Other			86,423			1			—			86,424
Total Wealth Management			146,798			23			—			146,821
Total Investment Management2			4			—			455			459
Total loans			204,554			15,255			8,188			227,997
ACL			(1,169)									(1,169)
Total loans, net of ACL			$	203,385		$	15,255		$	8,188		$	226,828
Lending commitments3			$	128,134		$	21,329		$	510		$	149,973
Total exposure			$	331,519		$	36,584		$	8,698		$	376,801

Total exposure—consists of Total loans, net of ACL, and Lending commitments

1.FVO includes the fair value of certain unfunded lending commitments.

2.Investment Management business segment loans are related to certain of our activities as an investment adviser and manager. Loans held at fair value are the result of the consolidation of investment vehicles (including CLOs) managed by Investment Management, composed primarily of senior secured loans to corporations.

3.Lending commitments represent the notional amount of legally binding obligations to provide funding to clients for lending transactions. Since commitments associated with these business activities may expire unused or may not be utilized to full capacity, they do not necessarily reflect the actual future cash funding requirements.

			28			March 2024 Form 10-Q

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Risk Disclosures

We provide loans and lending commitments to a variety of customers, including large corporate and institutional clients, as well as high to ultra-high net worth individuals. In addition, we purchase loans in the secondary market. Loans and lending commitments are either held for investment, held for sale or carried at fair value. For more information on these loan classifications, see Note 2 to the financial statements in the 2023 Form 10-K.

Total loans and lending commitments increased by approximately $8 billion since December 31, 2023, primarily due to an increase in Secured lending facilities and Corporate lending within the Institutional Securities business segment.

See Notes 4, 5, 9 and 13 to the financial statements for further information.

Allowance for Credit Losses—Loans and Lending Commitments

$ in millions			Three Months Ended March 31, 2024
ACL—Loans
Beginning balance			$	1,169
Provision for credit losses			(22)
Other			(6)
Ending balance			$	1,141
ACL—Lending commitments
Beginning balance			$	551
Provision for credit losses			16
Other			(2)
Ending balance			$	565
Total ending balance			$	1,706

Provision for Credit Losses by Business Segment

						Three Months Ended March 31, 2024
$ in millions												IS			WM			Total
Loans												$	(16)		$	(6)		$	(22)
Lending commitments												18			(2)			16
Total												$	2		$	(8)		$	(6)

Credit exposure arising from our loans and lending commitments is measured in accordance with our internal risk management standards. Risk factors considered in determining the allowance for credit losses for loans and lending commitments include the borrower’s financial strength, industry, facility structure, LTV ratio, debt service ratio, collateral and covenants. Qualitative and environmental factors such as economic and business conditions, nature and volume of the portfolio and lending terms, and volume and severity of past due loans may also be considered.

The allowance for credit losses for loans and lending commitments decreased in the current quarter, primarily related to improvements in the macroeconomic outlook. This was partially offset by provisions for certain specific commercial real estate and corporate loans and modest growth in certain other loan portfolios. There were no material charge-offs during the three months ended March 31, 2024. During the three months ended March 31, 2023, our net charge-off ratio was 0.04%.

The base scenario used in our ACL models as of March 31, 2024 was generated using a combination of consensus economic forecasts, forward rates, and internally developed and validated models. This scenario assumes slow economic growth in 2024, followed by a gradual improvement in 2025, as well as lower credit spreads and interest rates relative to the prior forecast. Given the nature of our lending portfolio, the most sensitive model input is U.S. gross domestic product (“GDP”).

Forecasted U.S. Real GDP Growth Rates in Base Scenario

			4Q 2024			4Q 2025
Year-over-year growth rate			1.0		%	2.0		%

See Note 2 to the financial statements in the 2023 Form 10-K for a discussion of the Firm’s ACL methodology under CECL.

Status of Loans Held for Investment

			At March 31, 2024						At December 31, 2023
			IS			WM			IS			WM
Accrual			99.0		%	99.7		%	98.9		%	99.8		%
Nonaccrual1			1.0		%	0.3		%	1.1		%	0.2		%

1.Nonaccrual loans are loans where principal or interest is not expected when contractually due or are past due 90 days or more.

Institutional Securities Loans and Lending Commitments1

			At March 31, 2024
			Contractual Years to Maturity
$ in millions			<1			1-5			5-15			>15			Total
Loans
AA			$	1		$	11		$	68		$	—		$	80
A			1,316			1,068			176			—			2,560
BBB			5,455			9,821			389			—			15,665
BB			10,925			18,090			2,525			315			31,855
Other NIG			9,356			11,661			2,851			171			24,039
Unrated2			271			1,509			94			3,202			5,076
Total loans, net of ACL			27,324			42,160			6,103			3,688			79,275
Lending commitments
AAA			—			50			—			—			50
AA			2,531			3,164			586			—			6,281
A			6,627			21,372			970			—			28,969
BBB			9,623			47,594			890			—			58,107
BB			3,238			18,980			3,809			465			26,492
Other NIG			1,497			14,817			2,296			3			18,613
Unrated2			4			24			222			—			250
Total lending commitments			23,520			106,001			8,773			468			138,762
Total exposure			$	50,844		$	148,161		$	14,876		$	4,156		$	218,037

March 2024 Form 10-Q			29

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Risk Disclosures

			At December 31, 2023
			Contractual Years to Maturity
$ in millions			<1			1-5			5-15			>15			Total
Loans
AA			$	3		$	11		$	216		$	—		$	230
A			1,054			950			182			—			2,186
BBB			7,117			10,076			346			—			17,539
BB			11,723			16,367			1,775			277			30,142
Other NIG			9,586			12,961			2,924			156			25,627
Unrated2			111			1,036			62			2,910			4,119
Total loans, net of ACL			29,594			41,401			5,505			3,343			79,843
Lending commitments
AAA			—			50			—			—			50
AA			2,610			3,064			154			—			5,828
A			7,704			21,256			593			—			29,553
BBB			9,161			46,304			106			—			55,571
BB			4,069			16,431			1,594			414			22,508
Other NIG			1,916			13,842			1,077			3			16,838
Unrated2			6			7			—			—			13
Total lending commitments			25,466			100,954			3,524			417			130,361
Total exposure			$	55,060		$	142,355		$	9,029		$	3,760		$	210,204

NIG–Non-investment grade

1.Counterparty credit ratings are internally determined by the CRM.

2.Unrated loans and lending commitments are primarily trading positions that are measured at fair value and risk-managed as a component of market risk. For a further discussion of our market risk, see “Quantitative and Qualitative Disclosures about Risk—Market Risk” herein.

Institutional Securities Loans and Lending Commitments by Industry

$ in millions			At March 31, 2024			At December 31, 2023
Industry
Financials			$	61,171		$	57,804
Real estate			35,543			35,342
Industrials			17,780			18,056
Communications services			15,348			15,301
Consumer discretionary			14,653			12,190
Information technology			14,501			12,430
Healthcare			13,251			14,274
Utilities			11,102			11,522
Consumer staples			9,588			9,305
Energy			9,468			9,156
Materials			6,671			6,503
Insurance			6,329			6,486
Other			2,632			1,835
Total exposure			$	218,037		$	210,204

Institutional Securities Lending Activities

The Institutional Securities business segment lending activities include Corporate, Secured lending facilities, Commercial and Residential real estate, and Securities-based lending and Other. As of March 31, 2024 and December 31, 2023, over 90% of our total lending exposure, which consists of loans and lending commitments, is investment grade and/or secured by collateral. For a description of Institutional Securities’ lending activities, see “Quantitative and Qualitative Disclosures about Risk—Credit Risk” in the 2023 Form 10-K.

Institutional Securities Event-Driven Loans and Lending Commitments

			At March 31, 2024
			Contractual Years to Maturity
$ in millions			<1			1-5			5-15						Total
Loans, net of ACL			$	2,096		$	693		$	2,562					$	5,351
Lending commitments			1,537			1,069			1,552						4,158
Total exposure			$	3,633		$	1,762		$	4,114					$	9,509

			At December 31, 2023
			Contractual Years to Maturity
$ in millions			<1			1-5			5-15						Total
Loans, net of ACL			$	1,974		$	2,564		$	2,580					$	7,118
Lending commitments			3,564			685			549						4,798
Total exposure			$	5,538		$	3,249		$	3,129					$	11,916

Event-driven loans and lending commitments are associated with certain underwritings and/or syndications to finance a specific transaction, such as merger, acquisition, recapitalization or project finance activities. Balances may fluctuate as such lending is related to transactions that vary in timing and size from period to period.

Institutional Securities Loans and Lending Commitments Held for Investment

			At March 31, 2024
$ in millions			Loans			Lending Commitments			Total
Corporate			$	7,171		$	96,771		$	103,942
Secured lending facilities			38,692			18,045			56,737
Commercial real estate			8,689			351			9,040
Securities-based lending and Other			2,687			847			3,534
Total, before ACL			$	57,239		$	116,014		$	173,253
ACL			$	(852)		$	(548)		$	(1,400)

						At December 31, 2023
$ in millions									Loans			Lending Commitments			Total
Corporate									$	6,758		$	91,752		$	98,510
Secured lending facilities									39,498			15,589			55,087
Commercial real estate									8,678			266			8,944
Securities-based lending and Other									2,818			915			3,733
Total, before ACL									$	57,752		$	108,522		$	166,274
ACL									$	(874)		$	(533)		$	(1,407)

			30			March 2024 Form 10-Q

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Risk Disclosures

Institutional Securities Commercial Real Estate Loans and Lending Commitments

By Region

			At March 31, 2024												At December 31, 2023
$ in millions			Loans1			LC1			Total						Loans1			LC1			Total
Americas			$	6,066		$	286		$	6,352					$	5,410		$	289		$	5,699
EMEA			3,223			158			3,381						3,127			56			3,183
Asia			545			2			547						485			—			485
Total			$	9,834		$	446		$	10,280					$	9,022		$	345		$	9,367

By Property Type

			At March 31, 2024												At December 31, 2023
$ in millions			Loans1			LC1			Total						Loans1			LC1			Total
Office			$	3,143		$	167		$	3,310					$	3,310		$	186		$	3,496
Industrial			2,898			111			3,009						2,435			5			2,440
Multifamily			1,802			93			1,895						1,715			74			1,789
Hotel			1,013			69			1,082						718			73			791
Retail			978			6			984						842			7			849
Other			—			—			—						2			—			2
Total			$	9,834		$	446		$	10,280					$	9,022		$	345		$	9,367

LC–Lending Commitments

1. Amounts include HFI, HFS and FVO loans and lending commitments. HFI loans are presented net of ACL.

The current economic environment and changes in business and consumer behavior have adversely impacted commercial real estate borrowers due to pressure from higher interest rates, tenant lease renewals, and elevated refinancing risks for loans with near-term maturities, among other issues. While we continue to actively monitor all our loan portfolios, the commercial real estate sector remains under heightened focus given the sector’s sensitivity to economic and secular factors, credit conditions, and difficulties specific to certain property types, most notably office.

As of March 31, 2024 and December 31, 2023, our lending against commercial real estate (“CRE”) properties totaled $10.3 billion and $9.4 billion within the Institutional Securities business segment, which represents 4.7% and 4.5% of total exposure reflected in the Institutional Securities Loans and Lending Commitments table above. Those CRE loans are originated for experienced sponsors and are generally secured by specific institutional CRE properties. In many cases, loans are subsequently syndicated or securitized on a full or partial basis, reducing our ongoing exposure.

In addition to the amounts included in the table above, we provide certain secured lending facilities which are typically collateralized by pooled CRE mortgage loans and are included in Secured lending facilities in the Institutional Securities Loans and Lending Commitments Held for Investment table above. These secured lending facilities benefit from structural protections including cross-collateralization and diversification across property types.

Institutional Securities Allowance for Credit Losses—Loans and Lending Commitments

			Three Months Ended March 31, 2024
$ in millions			Corporate			Secured Lending Facilities			CRE			Other			Total
ACL—Loans
Beginning balance			$	241		$	153		$	463		$	17		$	874
Provision (release)			1			(17)			1			(1)			(16)
Other			(1)			(1)			(3)			(1)			(6)
Ending balance			$	241		$	135		$	461		$	15		$	852
ACL—Lending commitments
Beginning balance			$	431		$	70		$	26		$	6		$	533
Provision (release)			(2)			25			(3)			(2)			18
Other			(3)			(1)			—			1			(3)
Ending balance			$	426		$	94		$	23		$	5		$	548
Total ending balance			$	667		$	229		$	484		$	20		$	1,400

Institutional Securities HFI Loans—Ratios of Allowance for Credit Losses to Balance Before Allowance

			At March 31, 2024			At December 31, 2023
Corporate			3.4		%	3.6		%
Secured lending facilities			0.3		%	0.4		%
Commercial real estate			5.3		%	5.3		%
Securities-based lending and Other			0.6		%	0.6		%
Total Institutional Securities loans			1.5		%	1.5		%

Wealth Management Loans and Lending Commitments

			At March 31, 2024
			Contractual Years to Maturity
$ in millions			<1			1-5			5-15			>15			Total
Securities-based lending and Other			$	76,968		$	7,751		$	1,302		$	132		$	86,153
Residential real estate			1			101			1,214			59,936			61,252
Total loans, net of ACL			$	76,969		$	7,852		$	2,516		$	60,068		$	147,405
Lending commitments			15,966			2,582			16			360			18,924
Total exposure			$	92,935		$	10,434		$	2,532		$	60,428		$	166,329

			At December 31, 2023
			Contractual Years to Maturity
$ in millions			<1			1-5			5-15			>15			Total
Securities-based lending and Other			$	76,923		$	7,679		$	1,494		$	133		$	86,229
Residential real estate			1			91			1,255			58,950			60,297
Total loans, net of ACL			$	76,924		$	7,770		$	2,749		$	59,083		$	146,526
Lending commitments			16,312			2,937			19			344			19,612
Total exposure			$	93,236		$	10,707		$	2,768		$	59,427		$	166,138

The principal Wealth Management business segment lending activities include Securities-based lending and Residential real estate loans.

Securities-based lending allows clients to borrow money against the value of qualifying securities, generally for any purpose other than purchasing, trading or carrying securities or refinancing margin debt. Other loans primarily include tailored lending, which typically consist of bespoke lending arrangements provided to ultra-high net worth clients. Securities-based lending and Other loans are generally secured by various types of eligible collateral, including

March 2024 Form 10-Q			31

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Table of Contents
Risk Disclosures

marketable securities, private investments, commercial real estate and other financial assets. For more information about our Securities-based lending and Residential real estate loans, see “Quantitative and Qualitative Disclosures about Risk—Credit Risk” in the 2023 Form 10-K.

Wealth Management Commercial Real Estate Loans and Lending Commitments by Property Type

			At March 31, 2024												At December 31, 2023
$ in millions			Loans1			LC1			Total						Loans1			LC1			Total
Retail			$	2,297		$	—		$	2,297					$	2,180		$	3		$	2,183
Multifamily			1,965			187			2,152						1,891			159			2,050
Office			1,734			16			1,750						1,736			16			1,752
Industrial			452			—			452						454			—			454
Hotel			387			—			387						400			—			400
Other			249			—			249						253			—			253
Total			$	7,084		$	203		$	7,287					$	6,914		$	178		$	7,092

LC–Lending Commitments

1.Amounts include HFI loans and lending commitments. HFI loans are presented net of ACL.

As of March 31, 2024 and December 31, 2023, our direct lending against CRE totaled $7.3 billion and $7.1 billion within the Wealth Management business segment, which represents 4.4% and 4.3% of total exposure reflected in the Wealth Management Loans and Lending Commitments table above, primarily included within Securities-based lending and Other loans. Such loans are originated through our private banking platform, are both secured and generally benefiting from full or partial guarantees from high or ultra-high net worth clients, which partially reduce associated credit risk. At both March 31, 2024 and December 31, 2023, greater than 95% of the CRE loans balance in the Wealth Management business segment received guarantees. All of our lending against CRE properties within Wealth Management are in the Americas region.

Wealth Management Allowance for Credit Losses—Loans and Lending Commitments

			Three Months Ended March 31, 2024
$ in millions			Residential Real Estate			SBL and Other			Total
ACL—Loans
Beginning balance			$	100		$	195		$	295
Provision (release)			(11)			5			(6)
Ending balance			$	89		$	200		$	289
ACL—Lending commitments
Beginning balance			$	4		$	14		$	18
Provision (release)			—			(2)			(2)
Other			—			1			1
Ending balance			$	4		$	13		$	17
Total ending balance			$	93		$	213		$	306

As of March 31, 2024 and December 31, 2023, more than 75% of Wealth Management residential real estate loans were to borrowers with “Exceptional” or “Very Good” FICO scores (i.e., exceeding 740). Additionally, Wealth Management’s securities-based lending portfolio remains well-collateralized and subject to daily client margining, which includes requiring customers to deposit additional collateral or reduce debt positions, when necessary.

Customer and Other Receivables

Margin Loans and Other Lending

$ in millions			At March 31, 2024			At December 31, 2023
Institutional Securities			$	24,071		$	24,208
Wealth Management			23,393			21,436
Total			$	47,464		$	45,644

The Institutional Securities and Wealth Management business segments provide margin lending arrangements that allow customers to borrow against the value of qualifying securities, primarily for the purpose of purchasing additional securities, as well as to collateralize short positions. Institutional Securities primarily includes margin loans in the Equity Financing business. Wealth Management includes margin loans as well as non-purpose securities-based lending on non-bank entities. Amounts may fluctuate from period to period as overall client balances change as a result of market levels, client positioning and leverage.

Credit exposures arising from margin lending activities are generally mitigated by their short-term nature, the value of collateral held and our right to call for additional margin when collateral values decline. However, we could incur losses in the event that the customer fails to meet margin calls and collateral values decline below the loan amount. This risk is elevated in loans backed by collateral pools with significant concentrations in individual issuers or securities with similar risk characteristics. For a further discussion, see “Risk Factors—Credit Risk” in the 2023 Form 10-K.

Employee Loans

For information on employee loans and related ACL, see Note 9 to the financial statements.

			32			March 2024 Form 10-Q

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Risk Disclosures

Derivatives

Fair Value of OTC Derivative Assets

			Counterparty Credit Rating1
$ in millions			AAA			AA			A			BBB			NIG			Total
At March 31, 2024
Less than 1 year			$	1,161		$	10,878		$	33,637		$	19,901		$	8,625		$	74,202
1-3 years			1,124			6,575			17,723			10,978			6,582			42,982
3-5 years			1,107			7,777			8,493			5,249			3,914			26,540
Over 5 years			3,119			28,963			48,383			27,306			7,059			114,830
Total, gross			$	6,511		$	54,193		$	108,236		$	63,434		$	26,180		$	258,554
Counterparty netting			(3,099)			(41,773)			(80,599)			(44,702)			(14,299)			(184,472)
Cash and securities collateral			(2,475)			(10,237)			(24,557)			(13,362)			(6,101)			(56,732)
Total, net			$	937		$	2,183		$	3,080		$	5,370		$	5,780		$	17,350

			Counterparty Credit Rating1
$ in millions			AAA			AA			A			BBB			NIG			Total
At December 31, 2023
Less than 1 year			$	2,013		$	16,885		$	37,517		$	25,529		$	10,084		$	92,028
1-3 years			1,013			7,274			18,451			12,757			7,360			46,855
3-5 years			504			8,897			8,814			5,989			3,825			28,029
Over 5 years			3,955			29,511			50,512			28,003			6,597			118,578
Total, gross			$	7,485		$	62,567		$	115,294		$	72,278		$	27,866		$	285,490
Counterparty netting			(3,691)			(48,821)			(86,826)			(53,178)			(15,888)			(208,404)
Cash and securities collateral			(2,709)			(10,704)			(25,921)			(13,025)			(5,554)			(57,913)
Total, net			$	1,085		$	3,042		$	2,547		$	6,075		$	6,424		$	19,173

$ in millions			At March 31, 2024			At December 31, 2023
Industry
Financials			$	5,511		$	7,215
Utilities			4,606			4,267
Regional governments			1,181			1,319
Industrials			940			937
Communications services			802			841
Energy			643			533
Consumer discretionary			590			684
Information technology			521			677
Healthcare			481			468
Consumer staples			477			515
Materials			358			383
Sovereign governments			247			262
Insurance			160			156
Real estate			136			167
Not-for-profit organizations			135			166
Other			562			583
Total			$	17,350		$	19,173

1.Counterparty credit ratings are determined internally by the CRM.

We are exposed to credit risk as a dealer in OTC derivatives. Credit risk with respect to derivative instruments arises from the possibility that a counterparty may fail to perform according to the terms of the contract. For more information on derivatives, see “Quantitative and Qualitative Disclosures about Risk—Credit Risk—Derivatives” in the 2023 Form 10-K and Note 6 to the financial statements.

Country Risk

Country risk exposure is the risk that events in, or that affect, a foreign country (any country other than the U.S.) might adversely affect us. We actively manage country risk exposure through a comprehensive risk management framework that combines credit and other market fundamentals and allows us to effectively identify, monitor and limit country risk. For a further discussion of our country risk exposure see “Quantitative and Qualitative Disclosures about Risk—Country and Other Risks” in the 2023 Form 10-K.

Top 10 Non-U.S. Country Exposures

			At March 31, 2024
$ in millions			United Kingdom			France			Germany			Brazil			China
Sovereign
Net inventory1			$	122		$	2,407		$	(713)		$	5,064		$	2,161
Net counterparty exposure2			14			—			120			3			334
Exposure before hedges			136			2,407			(593)			5,067			2,495
Hedges3			(55)			(6)			(253)			(154)			—
Net exposure			$	81		$	2,401		$	(846)		$	4,913		$	2,495
Non-sovereign
Net inventory1			$	1,476		$	1,113		$	852		$	129		$	2,293
Net counterparty exposure2			6,737			2,977			2,920			329			171
Loans			7,192			721			1,404			381			344
Lending commitments			9,736			3,091			5,500			456			666
Exposure before hedges			25,141			7,902			10,676			1,295			3,474
Hedges3			(1,963)			(2,112)			(2,031)			(14)			(1)
Net exposure			$	23,178		$	5,790		$	8,645		$	1,281		$	3,473
Total net exposure			$	23,259		$	8,191		$	7,799		$	6,194		$	5,968

$ in millions			Japan			India			Korea			Canada			Australia
Sovereign
Net inventory1			$	(42)		$	2,450		$	3,054		$	838		$	117
Net counterparty exposure2			17			—			387			15			91
Exposure before hedges			(25)			2,450			3,441			853			208
Hedges3			—			—			—			—			—
Net exposure			$	(25)		$	2,450		$	3,441		$	853		$	208
Non-sovereign
Net inventory1			$	1,426		$	979		$	37		$	259		$	208
Net counterparty exposure2			4,766			1,317			822			1,002			722
Loans			23			116			—			316			1,719
Lending commitments			—			—			—			1,703			936
Exposure before hedges			6,215			2,412			859			3,280			3,585
Hedges3			(234)			—			—			(106)			(14)
Net exposure			$	5,981		$	2,412		$	859		$	3,174		$	3,571
Total net exposure			$	5,956		$	4,862		$	4,300		$	4,027		$	3,779

1.Net inventory represents exposure to both long and short single-name and index positions (i.e., bonds and equities at fair value and CDS based on a notional amount assuming zero recovery adjusted for the fair value of any receivable or payable).

2.Net counterparty exposure (e.g., repurchase transactions, securities lending and OTC derivatives) is net of the benefit of collateral received and also is net by counterparty when legally enforceable master netting agreements are in place. For more information, see “Additional Information—Top 10 Non-U.S. Country Exposures” herein.

3.Amounts represent net CDS hedges (purchased and sold) on net counterparty exposure and lending executed by trading desks responsible for hedging counterparty and lending credit risk exposures. Amounts are based on the CDS notional amount assuming zero recovery adjusted for the fair value of any receivable or payable. For further description of the contractual terms for purchased credit protection and whether they may limit the effectiveness of our hedges, see “Quantitative and Qualitative Disclosures about Risk—Credit Risk—Derivatives” in the 2023 Form 10-K.

March 2024 Form 10-Q			33

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Risk Disclosures

Additional Information—Top 10 Non-U.S. Country Exposures

Collateral Held Against Net Counterparty Exposure1

$ in millions						At March 31, 2024
Country of Risk			Collateral2
United Kingdom			U.K., U.S., and France			$	8,039
Japan			Japan and U.S.			5,831
Other			U.S., Italy and France			15,119

1.The benefit of collateral received is reflected in the Top 10 Non-U.S. Country Exposures at March 31, 2024.

2.Primarily consists of cash and government obligations of the countries listed.

Operational Risk

Operational risk refers to the risk of loss, or of damage to our reputation, resulting from inadequate or failed processes or systems, from human factors or from external events (e.g., cyberattacks or third-party vulnerabilities) that may manifest as, for example, loss of information, business disruption, theft and fraud, legal and compliance risks, or damage to physical assets. We may incur operational risk across the full scope of our business activities, including revenue-generating activities and support and control groups (e.g., information technology and trade processing). For a further discussion about our operational risk, see “Quantitative and Qualitative Disclosures about Risk—Operational Risk” in the 2023 Form 10-K.

Model Risk

Model risk refers to the potential for adverse consequences from decisions based on incorrect or misused model outputs. Model risk can lead to financial loss, poor business and strategic decision-making or damage to our reputation. The risk inherent in a model is a function of the materiality, complexity and uncertainty around inputs and assumptions. Model risk is generated from the use of models impacting financial statements, regulatory filings, capital adequacy assessments and the formulation of strategy. For a further discussion about our model risk, see “Quantitative and Qualitative Disclosures about Risk—Model Risk” in the 2023 Form 10-K.

Liquidity Risk

Liquidity risk refers to the risk that we will be unable to finance our operations due to a loss of access to the capital markets or difficulty in liquidating our assets. Liquidity risk also encompasses our ability (or perceived ability) to meet our financial obligations without experiencing significant business disruption or reputational damage that may threaten our viability as a going concern. For a further discussion about our liquidity risk, see “Quantitative and Qualitative Disclosures about Risk—Liquidity Risk” in the 2023 Form 10-K and “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources” herein.

Legal, Regulatory and Compliance Risk

Legal, regulatory and compliance risk includes the risk of legal or regulatory sanctions, material financial loss, including fines, penalties, judgments, damages and/or settlements, limitations on our business, or loss to reputation that we may suffer as a result of failure to comply with laws, regulations, rules, related self-regulatory organization standards and codes of conduct applicable to our business activities. This risk also includes contractual and commercial risk, such as the risk that a counterparty’s performance obligations will be unenforceable. It also includes compliance with AML, terrorist financing, and anti-corruption rules and regulations. For a further discussion about our legal and compliance risk, see “Quantitative and Qualitative Disclosures about Risk—Legal, Regulatory and Compliance Risk” in the 2023 Form 10-K.

Climate Risk

Climate change manifests as physical and transition risks. The physical risks of climate change include harm to people and property arising from acute climate-related events, such as floods, hurricanes, heatwaves, droughts and wildfires, and chronic, longer-term shifts in climate patterns, such as higher global average temperatures, rising sea levels and long-term droughts. The transition risk of climate change include policy, legal, technology and market changes. Examples of these transition risks include changes in consumer behavior and business sentiment, related technologies, shareholder preferences and any additional regulatory and legislative requirements, including increased disclosure or carbon taxes. Climate risk, which is not expected to have a significant effect on our consolidated results of operations or financial condition in the near term, is an overarching risk that can impact other categories of risk. For a further discussion about our climate risk, see “Quantitative and Qualitative Disclosures about Risk—Climate Risk” in the 2023 Form 10-K.

			34			March 2024 Form 10-Q

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Report of Independent Registered Public Accounting Firm

To the Shareholders and the Board of Directors of Morgan Stanley:

Results of Review of Interim Financial Information

We have reviewed the accompanying condensed consolidated balance sheet of Morgan Stanley and subsidiaries (the “Firm”) as of March 31, 2024, and the related condensed consolidated income statements, comprehensive income statements, cash flow statements and statements of changes in total equity for the three-month periods ended March 31, 2024 and 2023, and the related notes (collectively referred to as the “interim financial information”). Based on our reviews, we are not aware of any material modifications that should be made to the accompanying interim financial information for it to be in conformity with accounting principles generally accepted in the United States of America.

We have previously audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheet of the Firm as of December 31, 2023, and the related consolidated income statement, comprehensive income statement, cash flow statement and statement of changes in total equity for the year then ended (not presented herein) included in the Firm’s Annual Report on Form 10-K; and in our report dated February 22, 2024, we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying condensed consolidated balance sheet as of December 31, 2023, is fairly stated, in all material respects, in relation to the consolidated balance sheet from which it has been derived.

Basis for Review Results

This interim financial information is the responsibility of the Firm’s management. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Firm in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our reviews in accordance with the standards of the PCAOB. A review of interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with the standards of the PCAOB, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.

/s/ Deloitte & Touche LLP
New York, New York
May 3, 2024

March 2024 Form 10-Q			35

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Consolidated Income Statement (Unaudited)

						Three Months Ended March 31,
in millions, except per share data									2024			2023
Revenues
Investment banking									$	1,589		$	1,330
Trading									4,852			4,477
Investments									137			145
Commissions and fees									1,227			1,239
Asset management									5,269			4,728
Other									266			252
Total non-interest revenues									13,340			12,171
Interest income1									12,930			9,980
Interest expense1									11,134			7,634
Net interest									1,796			2,346
Net revenues									15,136			14,517
Provision for credit losses									(6)			234
Non-interest expenses
Compensation and benefits									6,696			6,410
Brokerage, clearing and exchange fees									921			881
Information processing and communications									976			915
Professional services									639			710
Occupancy and equipment									441			440
Marketing and business development									217			247
Other									857			920
Total non-interest expenses									10,747			10,523
Income before provision for income taxes									4,395			3,760
Provision for income taxes									933			727
Net income									$	3,462		$	3,033
Net income applicable to noncontrolling interests									50			53
Net income applicable to Morgan Stanley									$	3,412		$	2,980
Preferred stock dividends									146			144
Earnings applicable to Morgan Stanley common shareholders									$	3,266		$	2,836
Earnings per common share
Basic									$	2.04		$	1.72
Diluted									$	2.02		$	1.70
Average common shares outstanding
Basic									1,601			1,645
Diluted									1,616			1,663

1.Prior period amounts have been adjusted to conform with the current period presentation. See Note 2 for additional information.

Consolidated Comprehensive Income Statement

(Unaudited)

			Three Months Ended March 31,
$ in millions			2024			2023
Net income			$	3,462		$	3,033
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustments			(173)			20
Change in net unrealized gains (losses) on available-for-sale securities			68			512
Pension and other			4			(1)
Change in net debt valuation adjustment			(563)			(15)
Net change in cash flow hedges			(28)			7
Total other comprehensive income (loss)			$	(692)		$	523
Comprehensive income			$	2,770		$	3,556
Net income applicable to noncontrolling interests			50			53
Other comprehensive income (loss) applicable to noncontrolling interests			(56)			(19)
Comprehensive income applicable to Morgan Stanley			$	2,776		$	3,522

March 2024 Form 10-Q			36			See Notes to Consolidated Financial Statements

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Table of Contents
Consolidated Balance Sheet

$ in millions, except share data			(Unaudited) At March 31, 2024			At December 31, 2023
Assets
Cash and cash equivalents			$	102,305		$	89,232
Trading assets at fair value ($148,191 and $162,698 were pledged to various parties)			367,633			367,074
Investment securities:
Available-for-sale at fair value (amortized cost of $91,260 and $92,149)			87,313			88,113
Held-to-maturity (fair value of $55,283 and $57,453)			65,420			66,694
Securities purchased under agreements to resell (includes $— and $7 at fair value)			122,733			110,740
Securities borrowed			132,852			121,091
Customer and other receivables			81,639			80,105
Loans:
Held for investment (net of allowance for credit losses of $1,141 and $1,169)			203,794			203,385
Held for sale			13,426			15,255
Goodwill			16,722			16,707
Intangible assets (net of accumulated amortization of $4,997 and $4,847)			6,914			7,055
Other assets			27,752			28,242
Total assets			$	1,228,503		$	1,193,693
Liabilities
Deposits (includes $6,429 and $6,472 at fair value)			$	352,494		$	351,804
Trading liabilities at fair value			152,843			151,513
Securities sold under agreements to repurchase (includes $827 and $1,020 at fair value)			82,404			62,651
Securities loaned			15,945			15,057
Other secured financings (includes $11,077 and $9,899 at fair value)			15,091			12,655
Customer and other payables			214,370			208,148
Other liabilities and accrued expenses			23,833			28,151
Borrowings (includes $95,104 and $93,900 at fair value)			271,383			263,732
Total liabilities			1,128,363			1,093,711
Commitments and contingent liabilities (see Note 13)
Equity
Morgan Stanley shareholders’ equity:
Preferred stock			8,750			8,750
Common stock, $0.01 par value:
Shares authorized: 3,500,000,000; Shares issued: 2,038,893,979; Shares outstanding: 1,626,657,461 and 1,626,828,437			20			20
Additional paid-in capital			29,046			29,832
Retained earnings			99,811			97,996
Employee stock trusts			5,250			5,314
Accumulated other comprehensive income (loss)			(7,057)			(6,421)
Common stock held in treasury at cost, $0.01 par value (412,236,518 and 412,065,542 shares)			(31,372)			(31,139)
Common stock issued to employee stock trusts			(5,250)			(5,314)
Total Morgan Stanley shareholders’ equity			99,198			99,038
Noncontrolling interests			942			944
Total equity			100,140			99,982
Total liabilities and equity			$	1,228,503		$	1,193,693

See Notes to Consolidated Financial Statements			37			March 2024 Form 10-Q

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Consolidated Statement of Changes in Total Equity (Unaudited)

			Three Months Ended March 31,
$ in millions			2024			2023
Preferred Stock
Beginning and ending balance			8,750			8,750
Common Stock
Beginning and ending balance			20			20
Additional Paid-in Capital
Beginning balance			29,832			29,339
Share-based award activity			(786)			(483)
Ending balance			29,046			28,856
Retained Earnings
Beginning balance			97,996			94,862
Cumulative adjustment related to the adoption of an accounting standard update1			(60)			—
Net income applicable to Morgan Stanley			3,412			2,980
Preferred stock dividends2			(146)			(144)
Common stock dividends2			(1,390)			(1,305)
Other net increases (decreases)			(1)			(1)
Ending balance			99,811			96,392
Employee Stock Trusts
Beginning balance			5,314			4,881
Share-based award activity			(64)			462
Ending balance			5,250			5,343
Accumulated Other Comprehensive Income (Loss)
Beginning balance			(6,421)			(6,253)
Net change in Accumulated other comprehensive income (loss)			(636)			542
Ending balance			(7,057)			(5,711)
Common Stock Held in Treasury at Cost
Beginning balance			(31,139)			(26,577)
Share-based award activity			1,485			1,304
Repurchases of common stock and employee tax withholdings			(1,718)			(2,208)
Ending balance			(31,372)			(27,481)
Common Stock Issued to Employee Stock Trusts
Beginning balance			(5,314)			(4,881)
Share-based award activity			64			(462)
Ending balance			(5,250)			(5,343)
Noncontrolling Interests
Beginning balance			944			1,090
Net income applicable to noncontrolling interests			50			53
Net change in Accumulated other comprehensive income (loss) applicable to noncontrolling interests			(56)			(19)
Other net increases (decreases)			4			4
Ending balance			942			1,128
Total Equity			$	100,140		$	101,954

1.The Firm adopted the Investments - Tax Credit Structures accounting standard update on January 1, 2024. Refer to Note 2 for further information.

2.See Note 16 for information regarding dividends per share for each class of stock.

March 2024 Form 10-Q			38			See Notes to Consolidated Financial Statements

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Consolidated Cash Flow Statement (Unaudited)

			Three Months Ended March 31,
$ in millions			2024			2023
Cash flows from operating activities
Net income			$	3,462		$	3,033
Adjustments to reconcile net income to net cash provided by (used for) operating activities:
Stock-based compensation expense			442			558
Depreciation and amortization			975			940
Provision for credit losses			(6)			234
Other operating adjustments			(12)			66
Changes in assets and liabilities:
Trading assets, net of Trading liabilities			(1,395)			2,582
Securities borrowed			(11,761)			(12,842)
Securities loaned			888			(91)
Customer and other receivables and other assets			272			4,899
Customer and other payables and other liabilities			3,735			777
Securities purchased under agreements to resell			(11,993)			(7,978)
Securities sold under agreements to repurchase			19,753			(2,043)
Net cash provided by (used for) operating activities			4,360			(9,865)
Cash flows from investing activities
Proceeds from (payments for):
Other assets—Premises, equipment and software			(816)			(719)
Changes in loans, net			(355)			(822)
AFS securities:
Purchases			(9,019)			(3,475)
Proceeds from sales			4,548			1,466
Proceeds from paydowns and maturities			5,308			3,460
HTM securities:
Purchases			(1,453)			—
Proceeds from paydowns and maturities			3,112			1,617
Other investing activities			(271)			(2,568)
Net cash provided by (used for) investing activities			1,054			(1,041)
Cash flows from financing activities
Net proceeds from (payments for):
Other secured financings			1,225			356
Deposits			534			(9,084)
Proceeds from issuance of Borrowings			28,079			21,219
Payments for:
Borrowings			(17,721)			(15,201)
Repurchases of common stock and employee tax withholdings			(1,718)			(2,205)
Cash dividends			(1,496)			(1,406)
Other financing activities			(46)			33
Net cash provided by (used for) financing activities			8,857			(6,288)
Effect of exchange rate changes on cash and cash equivalents			(1,198)			325
Net increase (decrease) in cash and cash equivalents			13,073			(16,869)
Cash and cash equivalents, at beginning of period			89,232			128,127
Cash and cash equivalents, at end of period			$	102,305		$	111,258
Supplemental Disclosure of Cash Flow Information
Cash payments for:
Interest			$	11,878		$	8,912
Income taxes, net of refunds			233			307

See Notes to Consolidated Financial Statements			39			March 2024 Form 10-Q

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Table of Contents
Notes to Consolidated Financial Statements (Unaudited)

1. Introduction and Basis of Presentation

The Firm

Morgan Stanley is a global financial services firm that maintains significant market positions in each of its business segments—Institutional Securities, Wealth Management and Investment Management. Morgan Stanley, through its subsidiaries and affiliates, provides a wide variety of products and services to a large and diversified group of clients and customers, including corporations, governments, financial institutions and individuals. Unless the context otherwise requires, the terms “Morgan Stanley” or the “Firm” mean Morgan Stanley (the “Parent Company”) together with its consolidated subsidiaries. See the “Glossary of Common Terms and Acronyms” for the definition of certain terms and acronyms used throughout this Form 10-Q.

A description of the clients and principal products and services of each of the Firm’s business segments is as follows:

Institutional Securities provides a variety of products and services to corporations, governments, financial institutions and ultra-high net worth clients. Investment Banking services consist of capital raising and financial advisory services, including the underwriting of debt, equity securities and other products, as well as advice on mergers and acquisitions, restructurings and project finance. Our Equity and Fixed Income businesses include sales, financing, prime brokerage, market-making, Asia wealth management services and certain business-related investments. Lending activities include originating corporate loans and commercial real estate loans, providing secured lending facilities, and extending securities-based and other financing to customers. Other activities include research.

Wealth Management provides a comprehensive array of financial services and solutions to individual investors and small to medium-sized businesses and institutions covering: financial advisor-led brokerage, custody, administrative and investment advisory services; self-directed brokerage services; financial and wealth planning services; workplace services, including stock plan administration; securities-based lending, residential real estate loans and other lending products; banking; and retirement plan services.

Investment Management provides a broad range of investment strategies and products that span geographies, asset classes, and public and private markets to a diverse group of clients across institutional and intermediary channels. Strategies and products, which are offered through a variety of investment vehicles, include equity, fixed income, alternatives and solutions, and liquidity and overlay services. Institutional clients include defined benefit/defined contribution plans, foundations, endowments, government entities, sovereign wealth funds, insurance companies, third-party fund sponsors and corporations. Individual clients are

generally served through intermediaries, including affiliated and non-affiliated distributors.

Basis of Financial Information

The financial statements are prepared in accordance with U.S. GAAP, which requires the Firm to make estimates and assumptions regarding the valuations of certain financial instruments, the valuations of goodwill and intangible assets, the outcome of legal and tax matters, deferred tax assets, ACL, and other matters that affect its financial statements and related disclosures. The Firm believes that the estimates utilized in the preparation of its financial statements are prudent and reasonable. Actual results could differ materially from these estimates.

The Notes are an integral part of the Firm’s financial statements. The Firm has evaluated subsequent events for adjustment to or disclosure in these financial statements through the date of this report and has not identified any recordable or disclosable events not otherwise reported in these financial statements or the notes thereto.

The accompanying financial statements should be read in conjunction with the Firm’s financial statements and notes thereto included in the 2023 Form 10-K. Certain footnote disclosures included in the 2023 Form 10-K have been condensed or omitted from these financial statements as they are not required for interim reporting under U.S. GAAP. The financial statements reflect all adjustments of a normal, recurring nature that are, in the opinion of management, necessary for the fair presentation of the results for the interim period. The results of operations for interim periods are not necessarily indicative of results for the entire year.

Consolidation

The financial statements include the accounts of the Firm, its wholly owned subsidiaries and other entities in which the Firm has a controlling financial interest, including certain VIEs (see Note 14). Intercompany balances and transactions have been eliminated. For consolidated subsidiaries that are not wholly owned, the third-party holdings of equity interests are referred to as Noncontrolling interests. The net income attributable to Noncontrolling interests for such subsidiaries is presented as Net income applicable to noncontrolling interests in the income statement. The portion of shareholders’ equity that is attributable to Noncontrolling interests for such subsidiaries is presented as Noncontrolling interests, a component of Total equity, in the balance sheet.

For a discussion of the Firm’s significant regulated U.S. and international subsidiaries and its involvement with VIEs, see Note 1 to the financial statements in the 2023 Form 10-K.

March 2024 Form 10-Q			40

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Table of Contents
Notes to Consolidated Financial Statements (Unaudited)

2. Significant Accounting Policies

For a detailed discussion about the Firm’s significant accounting policies and for further information on accounting updates adopted in the prior year, see Note 2 to the financial statements in the 2023 Form 10-K.

In the first quarter of 2024, the Firm implemented certain presentation changes that impacted interest income and interest expense but had no effect on net interest income. These changes were made to align the accounting treatment between the balance sheet and the related interest income or expense, primarily by offsetting interest income and expense for certain prime brokerage-related customer receivables and payables that are currently accounted for as a single unit of account on the balance sheet. The current and previous presentation of these interest income and interest expense amounts are acceptable and the change does not represent a change in accounting principle. These changes were applied retrospectively to the income statement in 2023 and accordingly, prior period amounts were adjusted to conform with the current presentation.

During the three months ended March 31, 2024 there were no significant updates to the Firm’s significant accounting policies, other than for the accounting updates adopted.

Accounting Updates Adopted in 2024

Investments - Tax Credit Structures

The Firm adopted the Investments - Equity Method and Joint Ventures - Tax Credit Structures accounting update on January 1, 2024 using the modified retrospective method. This accounting update permits an election to account for tax equity investments using the proportional amortization method if certain conditions are met. Under the proportional amortization method, the initial cost of the investment is amortized in proportion to the income tax credits and other income tax benefits received and recognized net in the income statement as a component of provision for income taxes. The update requires a separate accounting policy election to be made for each tax credit program. Additional disclosures are required regarding (i) the nature of our tax equity investments and (ii) the effect of our tax equity investments and related income tax credits on the financial condition and results of operations (see Note 10).

The adoption resulted in a decrease to Retained earnings of $60 million as of January 1, 2024, net of tax, and a corresponding reduction to Other assets.

3. Cash and Cash Equivalents

$ in millions			At March 31, 2024			At December 31, 2023
Cash and due from banks			$	8,356		$	7,323
Interest bearing deposits with banks			93,949			81,909
Total Cash and cash equivalents			$	102,305		$	89,232
Restricted cash			$	32,492		$	30,571

For additional information on cash and cash equivalents, including restricted cash, see Note 2 to the financial statements in the 2023 Form 10-K.

4. Fair Values

Recurring Fair Value Measurements    

Assets and Liabilities Measured at Fair Value on a Recurring Basis

			At March 31, 2024
$ in millions			Level 1			Level 2			Level 3			Netting1			Total
Assets at fair value
Trading assets:
U.S. Treasury and agency securities			$	64,272		$	44,638		$	—		$	—		$	108,910
Other sovereign government obligations			27,671			11,170			64			—			38,905
State and municipal securities			—			1,927			102			—			2,029
MABS			—			1,689			457			—			2,146
Loans and lending commitments2			—			8,030			1,895			—			9,925
Corporate and other debt			—			37,304			2,042			—			39,346
Corporate equities3,5			118,398			715			268			—			119,381
Derivative and other contracts:
Interest rate			2,067			133,957			843			—			136,867
Credit			1			10,049			401			—			10,451
Foreign exchange			34			72,069			249			—			72,352
Equity			1,831			74,034			595			—			76,460
Commodity and other			1,763			12,108			2,894			—			16,765
Netting1			(4,301)			(230,318)			(1,002)			(39,842)			(275,463)
Total derivative and other contracts			1,395			71,899			3,980			(39,842)			37,432
Investments4,5			1,049			879			970			—			2,898
Physical commodities			—			1,322			—			—			1,322
Total trading assets4			212,785			179,573			9,778			(39,842)			362,294
Investment securities—AFS			58,224			29,089			—			—			87,313
Total assets at fair value			$	271,009		$	208,662		$	9,778		$	(39,842)		$	449,607

			41			March 2024 Form 10-Q

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Table of Contents
Notes to Consolidated Financial Statements (Unaudited)

			At March 31, 2024
$ in millions			Level 1			Level 2			Level 3			Netting1			Total
Liabilities at fair value
Deposits			$	—		$	6,378		$	51		$	—		$	6,429
Trading liabilities:
U.S. Treasury and agency securities			24,479			25			—			—			24,504
Other sovereign government obligations			30,427			3,624			—			—			34,051
Corporate and other debt			—			12,654			39			—			12,693
Corporate equities3			49,284			267			34			—			49,585
Derivative and other contracts:
Interest rate			1,823			124,827			795			—			127,445
Credit			—			10,623			274			—			10,897
Foreign exchange			151			66,542			229			—			66,922
Equity			1,975			87,270			1,584			—			90,829
Commodity and other			1,874			10,851			1,684			—			14,409
Netting1			(4,301)			(230,318)			(1,002)			(42,871)			(278,492)
Total derivative and other contracts			1,522			69,795			3,564			(42,871)			32,010
Total trading liabilities			105,712			86,365			3,637			(42,871)			152,843
Securities sold under agreements to repurchase			—			367			460			—			827
Other secured financings			—			11,003			74			—			11,077
Borrowings			—			93,077			2,027			—			95,104
Total liabilities at fair value			$	105,712		$	197,190		$	6,249		$	(42,871)		$	266,280

			At December 31, 2023
$ in millions			Level 1			Level 2			Level 3			Netting1			Total
Assets at fair value
Trading assets:
U.S. Treasury and agency securities			$	56,459		$	53,741		$	—		$	—		$	110,200
Other sovereign government obligations			22,580			9,946			94			—			32,620
State and municipal securities			—			2,148			34			—			2,182
MABS			—			1,540			489			—			2,029
Loans and lending commitments2			—			6,122			2,066			—			8,188
Corporate and other debt			—			35,833			1,983			—			37,816
Corporate equities3			126,772			929			199			—			127,900
Derivative and other contracts:
Interest rate			7,284			140,139			784			—			148,207
Credit			—			10,244			393			—			10,637
Foreign exchange			12			93,218			20			—			93,250
Equity			2,169			55,319			587			—			58,075
Commodity and other			1,608			11,862			2,811			—			16,281
Netting1			(7,643)			(237,497)			(1,082)			(42,915)			(289,137)
Total derivative and other contracts			3,430			73,285			3,513			(42,915)			37,313
Investments4			781			836			949			—			2,566
Physical commodities			—			736			—			—			736
Total trading assets4			210,022			185,116			9,327			(42,915)			361,550
Investment securities—AFS			57,405			30,708			—			—			88,113
Securities purchased under agreements to resell			—			7			—			—			7
Total assets at fair value			$	267,427		$	215,831		$	9,327		$	(42,915)		$	449,670

			At December 31, 2023
$ in millions			Level 1			Level 2			Level 3			Netting1			Total
Liabilities at fair value
Deposits			$	—		$	6,439		$	33		$	—		$	6,472
Trading liabilities:
U.S. Treasury and agency securities			27,708			16			—			—			27,724
Other sovereign government obligations			26,829			3,955			6			—			30,790
Corporate and other debt			—			10,560			9			—			10,569
Corporate equities3			46,809			300			45			—			47,154
Derivative and other contracts:
Interest rate			8,000			129,983			857			—			138,840
Credit			—			10,795			297			—			11,092
Foreign exchange			96			89,880			385			—			90,361
Equity			2,411			64,794			1,689			—			68,894
Commodity and other			1,642			11,904			1,521			—			15,067
Netting1			(7,643)			(237,497)			(1,082)			(42,757)			(288,979)
Total derivative and other contracts			4,506			69,859			3,667			(42,757)			35,275
Total trading liabilities			105,852			84,690			3,727			(42,757)			151,512
Securities sold under agreements to repurchase			—			571			449			—			1,020
Other secured financings			—			9,807			92			—			9,899
Borrowings			—			92,022			1,878			—			93,900
Total liabilities at fair value			$	105,852		$	193,529		$	6,179		$	(42,757)		$	262,803

MABS—Mortgage- and asset-backed securities

1.For positions with the same counterparty that cross over the levels of the fair value hierarchy, both counterparty netting and cash collateral netting are included in the column titled “Netting.” Positions classified within the same level that are with the same counterparty are netted within that level. For further information on derivative instruments and hedging activities, see Note 6.

2.For a further breakdown by type, see the following Detail of Loans and Lending Commitments at Fair Value table.

3.For trading purposes, the Firm holds or sells short equity securities issued by entities in diverse industries and of varying sizes.

4.Amounts exclude certain investments that are measured based on NAV per share, which are not classified in the fair value hierarchy. For additional disclosure about such investments, see “Net Asset Value Measurements” herein.

5.At March 31, 2024 and December 31, 2023, the Firm's Trading assets included an insignificant amount of equity securities subject to contractual sale restrictions that generally prohibit the Firm from selling the security for a period of time as of the measurement date.

Detail of Loans and Lending Commitments at Fair Value

$ in millions			At March 31, 2024			At December 31, 2023
Commercial Real Estate			$	1,141		$	422
Residential Real Estate			3,338			2,909
Securities-based lending and Other loans			5,446			4,857
Total			$	9,925		$	8,188

Unsettled Fair Value of Futures Contracts1

$ in millions			At March 31, 2024			At December 31, 2023
Customer and other receivables (payables), net			$	1,524		$	1,062

1.These contracts are primarily Level 1, actively traded, valued based on quoted prices from the exchange and are excluded from the previous recurring fair value tables.

For a description of the valuation techniques applied to the Firm’s major categories of assets and liabilities measured at fair value on a recurring basis, see Note 4 to the financial statements in the 2023 Form 10-K. During the current quarter,

March 2024 Form 10-Q			42

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Table of Contents
Notes to Consolidated Financial Statements (Unaudited)

there were no significant revisions made to the Firm’s valuation techniques.

Rollforward of Level 3 Assets and Liabilities Measured at Fair Value on a Recurring Basis

						Three Months Ended March 31,
$ in millions									2024			2023
U.S. Treasury and agency securities
Beginning balance									$	—		$	17
Purchases									—			(9)
Sales									—			(7)
Ending balance									$	—		$	1
Unrealized gains (losses)									$	—		$	—
Other sovereign government obligations
Beginning balance									$	94		$	169
Realized and unrealized gains (losses)									(2)			4
Purchases									3			78
Sales									(8)			(54)
Net transfers									(23)			(1)
Ending balance									$	64		$	196
Unrealized gains (losses)									$	1		$	4
State and municipal securities
Beginning balance									$	34		$	145
Purchases									2			—
Sales									(32)			(40)
Net transfers									98			(102)
Ending balance									$	102		$	3
Unrealized gains (losses)									$	—		$	—
MABS
Beginning balance									$	489		$	416
Realized and unrealized gains (losses)									6			2
Purchases									48			57
Sales									(84)			(45)
Net transfers									(2)			24
Ending balance									$	457		$	454
Unrealized gains (losses)									$	(8)		$	1
Loans and lending commitments
Beginning balance									$	2,066		$	2,017
Realized and unrealized gains (losses)									(10)			(26)
Purchases and originations									483			535
Sales									(410)			(193)
Settlements									(122)			(235)
Net transfers									(112)			(41)
Ending balance									$	1,895		$	2,057
Unrealized gains (losses)									$	(10)		$	(25)

						Three Months Ended March 31,
$ in millions									2024			2023
Corporate and other debt
Beginning balance									$	1,983		$	2,096
Realized and unrealized gains (losses)									50			34
Purchases and originations									196			508
Sales									(122)			(446)
Settlements									(2)			—
Net transfers									(63)			51
Ending balance									$	2,042		$	2,243
Unrealized gains (losses)									$	108		$	64
Corporate equities
Beginning balance									$	199		$	116
Realized and unrealized gains (losses)									(64)			(8)
Purchases									10			19
Sales									(12)			(25)
Net transfers									135			42
Ending balance									$	268		$	144
Unrealized gains (losses)									$	(2)		$	(2)
Investments
Beginning balance									$	949		$	923
Realized and unrealized gains (losses)									20			14
Purchases									3			47
Sales									(2)			(24)
Net transfers									—			(5)
Ending balance									$	970		$	955
Unrealized gains (losses)									$	(5)		$	10
Investment securities—AFS
Beginning balance									$	—		$	35
Realized and unrealized gains (losses)									—			1
Net transfers									—			(36)
Ending balance									$	—		$	—
Unrealized gains (losses)									$	—		$	1
Net derivatives: Interest rate
Beginning balance									$	(73)		$	(151)
Realized and unrealized gains (losses)									113			(149)
Purchases									31			10
Issuances									(16)			(8)
Settlements									(112)			189
Net transfers									105			(108)
Ending balance									$	48		$	(217)
Unrealized gains (losses)									$	119		$	29

			43			March 2024 Form 10-Q

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Table of Contents
Notes to Consolidated Financial Statements (Unaudited)

						Three Months Ended March 31,
$ in millions									2024			2023
Net derivatives: Credit
Beginning balance									$	96		$	110
Realized and unrealized gains (losses)									(11)			(27)
Settlements									48			(31)
Net transfers									(6)			(4)
Ending balance									$	127		$	48
Unrealized gains (losses)									$	(9)		$	(28)
Net derivatives: Foreign exchange
Beginning balance									$	(365)		$	66
Realized and unrealized gains (losses)									301			(11)
Purchases									9			—
Issuances									—			(3)
Settlements									(28)			40
Net transfers									103			(26)
Ending balance									$	20		$	66
Unrealized gains (losses)									$	348		$	(10)
Net derivatives: Equity
Beginning balance									$	(1,102)		$	(736)
Realized and unrealized gains (losses)									171			16
Purchases									47			39
Issuances									(49)			(161)
Settlements									77			(30)
Net transfers									(133)			95
Ending balance									$	(989)		$	(777)
Unrealized gains (losses)									$	192		$	(30)
Net derivatives: Commodity and other
Beginning balance									$	1,290		$	1,083
Realized and unrealized gains (losses)									44			446
Purchases									87			16
Issuances									(44)			(3)
Settlements									(153)			(103)
Net transfers									(14)			160
Ending balance									$	1,210		$	1,599
Unrealized gains (losses)									$	(132)		$	211
Deposits
Beginning balance									$	33		$	20
Realized and unrealized losses (gains)									1			—
Issuances									2			6
Settlements									(1)			—
Net transfers									16			3
Ending balance									$	51		$	29
Unrealized losses (gains)									$	1		$	—
Nonderivative trading liabilities
Beginning balance									$	60		$	74
Realized and unrealized losses (gains)									4			(7)
Purchases									(38)			(44)
Sales									27			113
Net transfers									20			24
Ending balance									$	73		$	160
Unrealized losses (gains)									$	4		$	(5)

						Three Months Ended March 31,
$ in millions									2024			2023
Securities sold under agreements to repurchase
Beginning balance									$	449		$	512
Realized and unrealized losses (gains)									11			11
Settlements									—			(9)
Ending balance									$	460		$	514
Unrealized losses (gains)									$	11		$	11
Other secured financings
Beginning balance									$	92		$	91
Realized and unrealized losses (gains)									(4)			2
Issuances									7			41
Settlements									(21)			(19)
Ending balance									$	74		$	115
Unrealized losses (gains)									$	(4)		$	2
Borrowings
Beginning balance									$	1,878		$	1,587
Realized and unrealized losses (gains)									51			48
Issuances									217			239
Settlements									(109)			(82)
Net transfers									(10)			(143)
Ending balance									$	2,027		$	1,649
Unrealized losses (gains)									$	50		$	45
Portion of Unrealized losses (gains) recorded in OCI—Change in net DVA									22			9

Level 3 instruments may be hedged with instruments classified in Level 1 and Level 2. The realized and unrealized gains or losses for assets and liabilities within the Level 3 category presented in the previous tables do not reflect the related realized and unrealized gains or losses on hedging instruments that have been classified by the Firm within the Level 1 and/or Level 2 categories.

The unrealized gains (losses) during the period for assets and liabilities within the Level 3 category may include changes in fair value during the period that were attributable to both observable and unobservable inputs. Total realized and unrealized gains (losses) are primarily included in Trading revenues in the income statement.

Additionally, in the previous tables, consolidations of VIEs are included in Purchases, and deconsolidations of VIEs are included in Settlements.

March 2024 Form 10-Q			44

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Table of Contents
Notes to Consolidated Financial Statements (Unaudited)

Significant Unobservable Inputs Used in Recurring and Nonrecurring Level 3 Fair Value Measurements

Valuation Techniques and Unobservable Inputs

			Balance / Range (Average1)
$ in millions, except inputs			At March 31, 2024			At December 31, 2023
Assets at Fair Value on a Recurring Basis
Other sovereign government obligations			$	64		$	94
Comparable pricing:
Bond price			62 to 116 points (87 points)			61 to 110 points (87 points)
State and municipal securities			$	102		$	34
Comparable pricing:
Bond price			99 to 100 points (100 points)			N/M
MABS			$	457		$	489
Comparable pricing:
Bond price			0 to 88 points (60 points)			0 to 88 points (61 points)
Loans and lending commitments			$	1,895		$	2,066
Margin loan model:
Margin loan rate			2% to 4% (3%)			2% to 4% (3%)
Comparable pricing:
Loan price			84 to 101 points (97 points)			85 to 102 points (98 points)
Corporate and other debt			$	2,042		$	1,983
Comparable pricing:
Bond price			28 to 130 points (85 points)			28 to 135 points (82 points)
Discounted cash flow:
Loss given default			54% to 84% (62% / 54%)			54% to 84% (62% / 54%)
Corporate equities			$	268		$	199
Comparable pricing:
Equity price			100%			100%
Investments			$	970		$	949
Discounted cash flow:
WACC			9% to 17% (12%)			16% to 18% (17%)
Exit multiple			9 to 10 times (10 times)			9 to 17 times (15 times)
Market approach:
EBITDA multiple			21 times			22 times
Comparable pricing:
Equity price			24% to 100% (85%)			24% to 100% (86%)
Net derivative and other contracts:
Interest rate			$	48		$	(73)
Option model:
IR volatility skew			69% to 87% (75% / 70%)			70% to 100% (81% / 93%)
IR curve correlation			70% to 87% (83% / 85%)			49% to 99% (77% / 79%)
Bond volatility			100% to 110% (106% / 110%)			79% to 85% (82% / 85%)
Inflation volatility			29% to 70% (43% / 39%)			27% to 70% (43% / 39%)
Credit			$	127		$	96
Credit default swap model:
Cash-synthetic basis			7 points			7 points
Bond price			0 to 92 points (47 points)			0 to 92 points (46 points)
Credit spread			10 to 365 bps (96 bps)			10 to 404 bps (94 bps)
Funding spread			18 to 590 bps (71 bps)			18 to 590 bps (67 bps)

			Balance / Range (Average1)
$ in millions, except inputs			At March 31, 2024			At December 31, 2023
Foreign exchange2			$	20		$	(365)
Option model:
IR curve			-1% to 14% (5% / 4%)			-4% to 26% (7% / 5%)
Foreign exchange volatility skew			N/M			-3% to 12% (2% / 0%)
Contingency probability			70% to 95% (90% / 95%)			95%
Equity2			$	(989)		$	(1,102)
Option model:
Equity volatility			6% to 92% (19%)			6% to 97% (23%)
Equity volatility skew			-1% to 0% (-1%)			-1% to 0% (0%)
Equity correlation			25% to 99% (59%)			25% to 97% (49%)
FX correlation			-74% to 50% (-19%)			-79% to 40% (-28%)
IR correlation			13% to 30% (14%)			10% to 30% (15%)
Commodity and other			$	1,210		$	1,290
Option model:
Forward power price			$0 to $186 ($48) per MWh			$0 to $220 ($49) per MWh
Commodity volatility			10% to 115% (31%)			8% to 123% (31%)
Cross-commodity correlation			54% to 100% (94%)			54% to 100% (94%)
Liabilities Measured at Fair Value on a Recurring Basis
Deposits			$	51		N/M
Option model:
Equity volatility			7% to 13% (7%)			N/M
Securities sold under agreements to repurchase			$	460		$	449
Discounted cash flow:
Funding spread			6 to 134 bps (42 / 30 bps)			28 to 135 bps (79 bps)
Other secured financings			$	74		$	92
Comparable pricing:
Loan price			22 to 101 points (73 points)			22 to 101 points (76 points)
Borrowings			$	2,027		$	1,878
Option model:
Equity volatility			4% to 70% (14%)			6% to 69% (13%)
Equity volatility skew			-1% to 0% (0%)			-2% to 0% (0%)
Equity correlation			25% to 98% (61%)			41% to 97% (79%)
Equity - FX correlation			-60% to 40% (-33%)			-65% to 40% (-30%)
IR curve correlation			60% to 99% (88% / 92%)			50% to 89% (71% / 70%)
Credit default swap model:
Credit spread			328 to 480 bps (404 bps)			N/M
Discounted cash flow:
Loss given default			54% to 84% (62% / 54%)			54% to 84% (62% / 54%)
Nonrecurring Fair Value Measurement
Loans			$	5,119		$	4,532
Corporate loan model:
Credit spread			110 to 1890 bps (1053 bps)			99 to 1467 bps (1015 bps)
Comparable pricing:
Loan price			42 to 100 points (86 points)			25 to 93 points (70 points)
Warehouse model:
Credit spread			110 to 275 bps (162 bps)			115 to 268 bps (185 bps)

Points—Percentage of par

IR—Interest rate

			45			March 2024 Form 10-Q

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Table of Contents
Notes to Consolidated Financial Statements (Unaudited)

FX—Foreign exchange

1.A single amount is disclosed for range and average when there is no significant difference between the minimum, maximum and average. Amounts represent weighted averages except where simple averages and the median of the inputs are more relevant.

2.Includes derivative contracts with multiple risks (i.e., hybrid products).

The previous table provides information on the valuation techniques, significant unobservable inputs, and the ranges and averages for each major category of assets and liabilities measured at fair value on a recurring and nonrecurring basis with a significant Level 3 balance. The level of aggregation and breadth of products cause the range of inputs to be wide and not evenly distributed across the inventory of financial instruments. Further, the range of unobservable inputs may differ across firms in the financial services industry because of diversity in the types of products included in each firm’s inventory. Generally, there are no predictable relationships between multiple significant unobservable inputs attributable to a given valuation technique.

For a description of the Firm’s significant unobservable inputs and qualitative information about the effect of hypothetical changes in the values of those inputs, see Note 4 to the financial statements in the 2023 Form 10-K. During the current quarter, there were no significant revisions made to the descriptions of the Firm’s significant unobservable inputs.

Net Asset Value Measurements

Fund Interests

			At March 31, 2024						At December 31, 2023
$ in millions			Carrying Value			Commitment			Carrying Value			Commitment
Private equity			$	2,460		$	693		$	2,685		$	720
Real estate			2,803			235			2,765			240
Hedge			77			3			74			3
Total			$	5,340		$	931		$	5,524		$	963

Amounts in the previous table represent the Firm’s carrying value of general and limited partnership interests in fund investments, as well as any related performance-based income in the form of carried interest. The carrying amounts are measured based on the NAV of the fund taking into account the distribution terms applicable to the interest held. This same measurement applies whether the fund investments are accounted for under the equity method or fair value.

For a description of the Firm’s investments in private equity funds, real estate funds and hedge funds, which are measured based on NAV, see Note 4 to the financial statements in the 2023 Form 10-K.

See Note 13 for information regarding general partner guarantees, which include potential obligations to return performance fee distributions previously received. See Note 19 for information regarding unrealized carried interest at risk of reversal.

Nonredeemable Funds by Contractual Maturity

			Carrying Value at March 31, 2024
$ in millions			Private Equity			Real Estate
Less than 5 years			$	1,122		$	947
5-10 years			1,242			1,816
Over 10 years			96			40
Total			$	2,460		$	2,803

Nonrecurring Fair Value Measurements

Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis

			At March 31, 2024
			Fair Value
$ in millions			Level 2			Level 31			Total
Assets
Loans			2,460			5,119			7,579
Total			$	2,460		$	5,119		$	7,579
Liabilities
Other liabilities and accrued expenses—Lending commitments			$	70		$	58		$	128
Total			$	70		$	58		$	128

			At December 31, 2023
			Fair Value
$ in millions			Level 2			Level 31			Total
Assets
Loans			$	4,215		$	4,532		$	8,747
Other assets—Other investments			—			4			4
Other assets—ROU assets			23			—			23
Total			$	4,238		$	4,536		$	8,774
Liabilities
Other liabilities and accrued expenses—Lending commitments			$	110		$	60		$	170
Total			$	110		$	60		$	170

1.For significant Level 3 balances, refer to “Significant Unobservable Inputs Used in Recurring and Nonrecurring Level 3 Fair Value Measurements” section herein for details of the significant unobservable inputs used for nonrecurring fair value measurement.

Gains (Losses) from Nonrecurring Fair Value Remeasurements1

						Three Months Ended March 31,
$ in millions									2024			2023
Assets
Loans2									$	(22)		$	19
Other assets—Premises, equipment and software3									—			(3)
Total									$	(22)		$	16
Liabilities
Other liabilities and accrued expenses—Lending commitments2									$	1		$	34
Total									$	1		$	34

1.Gains and losses for Loans and Other assets—Other investments are classified in Other revenues. For other items, gains and losses are recorded in Other revenues if the item is held for sale; otherwise, they are recorded in Other expenses.

2.Nonrecurring changes in the fair value of loans and lending commitments, which exclude the impact of related economic hedges, are calculated as follows: for the held-for-investment category, based on the value of the underlying collateral; and for the held-for-sale category, based on recently executed transactions, market price quotations, valuation models that incorporate market observable inputs where possible, such as comparable loan or debt prices and CDS spread levels adjusted for any basis difference between cash and derivative instruments, or default recovery analysis where such transactions and quotations are unobservable.

3.Losses related to Other assets—Premises, equipment and software generally include impairments as well as write-offs related to the disposal of certain assets.

March 2024 Form 10-Q			46

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Table of Contents
Notes to Consolidated Financial Statements (Unaudited)

Financial Instruments Not Measured at Fair Value

			At March 31, 2024
			Carrying Value			Fair Value
$ in millions						Level 1			Level 2			Level 3			Total
Financial assets
Cash and cash equivalents			$	102,305		$	102,305		$	—		$	—		$	102,305
Investment securities—HTM			65,420			19,768			34,355			1,160			55,283
Securities purchased under agreements to resell			122,733			—			120,543			2,200			122,743
Securities borrowed			132,852			—			132,852			—			132,852
Customer and other receivables			75,427			—			71,198			4,010			75,208
Loans1,2
Held for investment			203,794			—			15,513			181,932			197,445
Held for sale			13,426			—			6,002			7,511			13,513
Other assets			704			—			704			—			704
Financial liabilities
Deposits			$	346,065		$	—		$	346,166		$	—		$	346,166
Securities sold under agreements to repurchase			81,577			—			81,560			—			81,560
Securities loaned			15,945			—			15,945			—			15,945
Other secured financings			4,014			—			4,013			—			4,013
Customer and other payables			214,263			—			214,263			—			214,263
Borrowings			176,279			—			178,960			55			179,015
			Commitment Amount
Lending commitments3			$	157,086		$	—		$	1,108		$	833		$	1,941

			At December 31, 2023
			Carrying Value			Fair Value
$ in millions						Level 1			Level 2			Level 3			Total
Financial assets
Cash and cash equivalents			$	89,232		$	89,232		$	—		$	—		$	89,232
Investment securities—HTM			66,694			21,937			34,411			1,105			57,453
Securities purchased under agreements to resell			110,733			—			108,099			2,674			110,773
Securities borrowed			121,091			—			121,091			—			121,091
Customer and other receivables			74,337			—			70,110			4,031			74,141
Loans1,2
Held for investment			203,385			—			20,125			176,291			196,416
Held for sale			15,255			—			8,652			6,672			15,324
Other assets			704			—			704			—			704
Financial liabilities
Deposits			$	345,332		$	—		$	345,391		$	—		$	345,391
Securities sold under agreements to repurchase			61,631			—			61,621			—			61,621
Securities loaned			15,057			—			15,055			—			15,055
Other secured financings			2,756			—			2,756			—			2,756
Customer and other payables			208,015			—			208,015			—			208,015
Borrowings			169,832			—			171,009			4			171,013
			Commitment Amount
Lending commitments3			$	149,464		$	—		$	1,338		$	749		$	2,087

1.Amounts include loans measured at fair value on a nonrecurring basis.

2.Loans amounts have been disaggregated into HFI and HFS for the first time in the fourth quarter of 2023. Prior period amounts have been revised to match the current period presentation.

3.Represents Lending commitments accounted for as Held for Investment and Held for Sale. For a further discussion on lending commitments, see Note 13.

The previous tables exclude all non-financial assets and liabilities, such as Goodwill and Intangible assets, and certain financial instruments, such as equity method investments and certain receivables.

5. Fair Value Option

The Firm has elected the fair value option for certain eligible instruments that are risk managed on a fair value basis to mitigate income statement volatility caused by measurement basis differences between the elected instruments and their associated risk management transactions or to eliminate complexities of applying certain accounting models.

Borrowings Measured at Fair Value on a Recurring Basis

$ in millions			At March 31, 2024			At December 31, 2023
Business Unit Responsible for Risk Management
Equity			$	47,086		$	46,073
Interest rates			30,553			31,055
Commodities			13,480			12,798
Credit			2,384			2,400
Foreign exchange			1,601			1,574
Total			$	95,104		$	93,900

			47			March 2024 Form 10-Q

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Table of Contents
Notes to Consolidated Financial Statements (Unaudited)

Net Revenues from Borrowings under the Fair Value Option

						Three Months Ended March 31,
$ in millions									2024			2023
Trading revenues									$	(114)		$	(4,378)
Interest expense									144			108
Net revenues1									$	(258)		$	(4,486)

1.Amounts do not reflect any gains or losses from related economic hedges.

Gains (losses) from changes in fair value are recorded in Trading revenues and are mainly attributable to movements in the reference price or index, interest rates or foreign exchange rates.

Gains (Losses) Due to Changes in Instrument-Specific Credit Risk

			Three Months Ended March 31,
			2024						2023
$ in millions			Trading Revenues			OCI			Trading Revenues			OCI
Loans and other receivables1			$	26		$	—		$	(43)		$	—
Lending commitments			(3)			—			11			—
Deposits			—			(4)			—			93
Borrowings			(10)			(737)			(6)			(117)

$ in millions			At March 31, 2024			At December 31, 2023
Cumulative pre-tax DVA gain (loss) recognized in AOCI			$	(2,907)		$	(2,166)

1.Loans and other receivables-specific credit gains (losses) were determined by excluding the non-credit components of gains and losses.

Difference Between Contractual Principal and Fair Value1

$ in millions			At March 31, 2024			At December 31, 2023
Loans and other receivables2			$	10,667		$	11,086
Nonaccrual loans2			8,101			8,566
Borrowings3			3,085			3,030

1.Amounts indicate contractual principal greater than or (less than) fair value.

2.The majority of the difference between principal and fair value amounts for loans and other receivables relates to distressed debt positions purchased at amounts well below par.

3.Excludes borrowings where the repayment of the initial principal amount fluctuates based on changes in a reference price or index.

The previous tables exclude non-recourse debt from consolidated VIEs, liabilities related to transfers of financial assets treated as collateralized financings, pledged commodities and other liabilities that have specified assets attributable to them.

Fair Value Loans on Nonaccrual Status

$ in millions			At March 31, 2024			At December 31, 2023
Nonaccrual loans			$	568		$	440
Nonaccrual loans 90 or more days past due			176			75

6. Derivative Instruments and Hedging Activities

Fair Values of Derivative Contracts

			Assets at March 31, 2024
$ in millions			Bilateral OTC			Cleared OTC			Exchange-Traded			Total
Designated as accounting hedges
Interest rate			$	4		$	—		$	—		$	4
Foreign exchange			83			20			—			103
Total			87			20			—			107
Not designated as accounting hedges
Economic hedges of loans
Credit			3			30			—			33
Other derivatives
Interest rate			120,182			16,370			311			136,863
Credit			5,522			4,896			—			10,418
Foreign exchange			70,243			1,968			38			72,249
Equity			24,722			—			51,738			76,460
Commodity and other			14,511			—			2,254			16,765
Total			235,183			23,264			54,341			312,788
Total gross derivatives			$	235,270		$	23,284		$	54,341		$	312,895
Amounts offset
Counterparty netting			(163,903)			(20,569)			(51,634)			(236,106)
Cash collateral netting			(37,516)			(1,841)			—			(39,357)
Total in Trading assets			$	33,851		$	874		$	2,707		$	37,432
Amounts not offset1
Financial instruments collateral			(17,375)			—			—			(17,375)
Net amounts			$	16,476		$	874		$	2,707		$	20,057
Net amounts for which master netting or collateral agreements are not in place or may not be legally enforceable												$	2,798

			Liabilities at March 31, 2024
$ in millions			Bilateral OTC			Cleared OTC			Exchange-Traded			Total
Designated as accounting hedges
Interest rate			$	482		$	—		$	—		$	482
Foreign exchange			16			12			—			28
Total			498			12			—			510
Not designated as accounting hedges
Economic hedges of loans
Credit			44			779			—			823
Other derivatives
Interest rate			112,206			14,460			297			126,963
Credit			5,550			4,524			—			10,074
Foreign exchange			64,588			2,149			157			66,894
Equity			38,982			—			51,847			90,829
Commodity and other			11,770			—			2,639			14,409
Total			233,140			21,912			54,940			309,992
Total gross derivatives			$	233,638		$	21,924		$	54,940		$	310,502
Amounts offset
Counterparty netting			(163,903)			(20,569)			(51,634)			(236,106)
Cash collateral netting			(41,077)			(1,309)			—			(42,386)
Total in Trading liabilities			$	28,658		$	46		$	3,306		$	32,010
Amounts not offset1
Financial instruments collateral			(4,092)			—			(341)			(4,433)
Net amounts			$	24,566		$	46		$	2,965		$	27,577
Net amounts for which master netting or collateral agreements are not in place or may not be legally enforceable												4,950

			48			March 2024 Form 10-Q

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Table of Contents
Notes to Consolidated Financial Statements (Unaudited)

			Assets at December 31, 2023
$ in millions			Bilateral OTC			Cleared OTC			Exchange-Traded			Total
Designated as accounting hedges
Interest rate			$	25		$	—		$	—		$	25
Foreign exchange			5			5			—			10
Total			30			5			—			35
Not designated as accounting hedges
Economic hedges of loans
Credit			2			27			—			29
Other derivatives
Interest rate			127,414			19,914			854			148,182
Credit			5,712			4,896			—			10,608
Foreign exchange			90,654			2,570			16			93,240
Equity			20,338			—			37,737			58,075
Commodity and other			13,928			—			2,353			16,281
Total			258,048			27,407			40,960			326,415
Total gross derivatives			$	258,078		$	27,412		$	40,960		$	326,450
Amounts offset
Counterparty netting			(184,553)			(23,851)			(38,510)			(246,914)
Cash collateral netting			(39,493)			(2,730)			—			(42,223)
Total in Trading assets			$	34,032		$	831		$	2,450		$	37,313
Amounts not offset1
Financial instruments collateral			(15,690)			—			—			(15,690)
Net amounts			$	18,342		$	831		$	2,450		$	21,623
Net amounts for which master netting or collateral agreements are not in place or may not be legally enforceable												$	2,641

			Liabilities at December 31, 2023
$ in millions			Bilateral OTC			Cleared OTC			Exchange-Traded			Total
Designated as accounting hedges
Interest rate			$	467		$	—		$	—		$	467
Foreign exchange			414			43			—			457
Total			881			43			—			924
Not designated as accounting hedges
Economic hedges of loans
Credit			43			702			—			745
Other derivatives
Interest rate			120,604			17,179			590			138,373
Credit			5,920			4,427			—			10,347
Foreign exchange			87,104			2,694			106			89,904
Equity			31,545			—			37,349			68,894
Commodity and other			12,237			—			2,830			15,067
Total			257,453			25,002			40,875			323,330
Total gross derivatives			$	258,334		$	25,045		$	40,875		$	324,254
Amounts offset
Counterparty netting			(184,553)			(23,851)			(38,510)			(246,914)
Cash collateral netting			(41,082)			(983)			—			(42,065)
Total in Trading liabilities			$	32,699		$	211		$	2,365		$	35,275
Amounts not offset1
Financial instruments collateral			(6,864)			(8)			(37)			(6,909)
Net amounts			$	25,835		$	203		$	2,328		$	28,366
Net amounts for which master netting or collateral agreements are not in place or may not be legally enforceable												$	5,911

1.Amounts relate to master netting agreements and collateral agreements that have been determined by the Firm to be legally enforceable in the event of default but where certain other netting criteria are not met in accordance with applicable offsetting accounting guidance.

See Note 4 for information related to the unsettled fair value of futures contracts not designated as accounting hedges, which are excluded from the previous tables.

Notionals of Derivative Contracts

			Assets at March 31, 2024
$ in billions			Bilateral OTC			Cleared OTC			Exchange- Traded			Total
Designated as accounting hedges
Interest rate			$	—		$	88		$	—		$	88
Foreign exchange			14			2			—			16
Total			14			90			—			104
Not designated as accounting hedges
Economic hedges of loans
Credit			—			—			—			—
Other derivatives
Interest rate			4,324			7,845			570			12,739
Credit			203			161			—			364
Foreign exchange			3,692			193			14			3,899
Equity			583			—			509			1,092
Commodity and other			137			—			70			207
Total			8,939			8,199			1,163			18,301
Total gross derivatives			$	8,953		$	8,289		$	1,163		$	18,405

			Liabilities at March 31, 2024
$ in billions			Bilateral OTC			Cleared OTC			Exchange- Traded			Total
Designated as accounting hedges
Interest rate			$	2		$	195		$	—		$	197
Foreign exchange			1			2			—			3
Total			3			197			—			200
Not designated as accounting hedges
Economic hedges of loans
Credit			2			21			—			23
Other derivatives
Interest rate			4,639			7,457			427			12,523
Credit			217			143			—			360
Foreign exchange			3,742			196			43			3,981
Equity			666			—			788			1,454
Commodity and other			103			—			83			186
Total			9,369			7,817			1,341			18,527
Total gross derivatives			$	9,372		$	8,014		$	1,341		$	18,727

			Assets at December 31, 2023
$ in billions			Bilateral OTC			Cleared OTC			Exchange-Traded			Total
Designated as accounting hedges
Interest rate			$	—		$	92		$	—		$	92
Foreign exchange			1			1			—			2
Total			1			93			—			94
Not designated as accounting hedges
Economic hedges of loans
Credit			—			1			—			1
Other derivatives
Interest rate			4,153			8,357			560			13,070
Credit			214			176			—			390
Foreign exchange			3,378			165			7			3,550
Equity			528			—			440			968
Commodity and other			142			—			65			207
Total			8,415			8,699			1,072			18,186
Total gross derivatives			$	8,416		$	8,792		$	1,072		$	18,280

			49			March 2024 Form 10-Q

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Table of Contents
Notes to Consolidated Financial Statements (Unaudited)

			Liabilities at December 31, 2023
$ in billions			Bilateral OTC			Cleared OTC			Exchange-Traded			Total
Designated as accounting hedges
Interest rate			$	3		$	183		$	—		$	186
Foreign exchange			14			3			—			17
Total			17			186			—			203
Not designated as accounting hedges
Economic hedges of loans
Credit			2			22			—			24
Other derivatives
Interest rate			4,631			8,197			455			13,283
Credit			229			155			—			384
Foreign exchange			3,496			167			33			3,696
Equity			587			—			712			1,299
Commodity and other			101			—			79			180
Total			9,046			8,541			1,279			18,866
Total gross derivatives			$	9,063		$	8,727		$	1,279		$	19,069

The notional amounts of derivative contracts generally overstate the Firm’s exposure. In most circumstances, notional amounts are used only as a reference point from which to calculate amounts owed between the parties to the contract. Furthermore, notional amounts do not reflect the benefit of legally enforceable netting arrangements or risk mitigating transactions.

For a discussion of the Firm’s derivative instruments and hedging activities, see Note 6 to the financial statements in the 2023 Form 10-K.

Gains (Losses) on Accounting Hedges

			Three Months Ended
			March 31,
$ in millions			2024			2023
Fair value hedges—Recognized in Interest income
Interest rate contracts			$	572		$	(372)
Investment Securities—AFS			(552)			381
Fair value hedges—Recognized in Interest expense
Interest rate contracts			$	(2,127)		$	2,284
Deposits			10			(54)
Borrowings			2,109			(2,240)
Net investment hedges—Foreign exchange contracts
Recognized in OCI			$	371		$	(89)
Forward points excluded from hedge effectiveness testing—Recognized in Interest income			48			43
Cash flow hedges—Interest rate contracts1
Recognized in OCI			$	(47)		$	7
Less: Realized gains (losses) (pre-tax) reclassified from AOCI to interest income			(11)			(1)
Net change in cash flow hedges included within AOCI			(36)			8

1.For the current quarter ended March 31, 2024, there were no forecasted transactions that failed to occur. The net gains (losses) associated with cash flow hedges expected to be reclassified from AOCI within 12 months as of March 31, 2024, is approximately $(46) million. The maximum length of time over which forecasted cash flows are hedged is 15 months.

Fair Value Hedges—Hedged Items 

$ in millions			At March 31, 2024			At December 31, 2023
Investment Securities—AFS
Amortized cost basis currently or previously hedged			$	46,737		$	47,179
Basis adjustments included in amortized cost1			$	(1,120)		$	(732)
Deposits
Carrying amount currently or previously hedged			$	12,216		$	10,569
Basis adjustments included in carrying amount1			$	(41)		$	(31)
Borrowings
Carrying amount currently or previously hedged			$	163,127		$	158,659
Basis adjustments included in carrying amount—Outstanding hedges			$	(11,305)		$	(9,219)
Basis adjustments included in carrying amount—Terminated hedges			$	(666)		$	(671)

1.Hedge accounting basis adjustments are primarily related to outstanding hedges.

Gains (Losses) on Economic Hedges of Loans

			Three Months Ended
			March 31,
$ in millions			2024			2023
Recognized in Other revenues
Credit contracts1			$	(123)		$	(161)

1.Amounts related to hedges of certain held-for-investment and held-for-sale loans.

Net Derivative Liabilities and Collateral Posted

$ in millions			At March 31, 2024			At December 31, 2023
Net derivative liabilities with credit risk-related contingent features			$	18,862		$	21,957
Collateral posted			12,746			16,389

The previous table presents the aggregate fair value of certain derivative contracts that contain credit risk-related contingent features that are in a net liability position for which the Firm has posted collateral in the normal course of business.

Incremental Collateral and Termination Payments upon Potential Future Ratings Downgrade

$ in millions			At March 31, 2024
One-notch downgrade			$	359
Two-notch downgrade			411
Bilateral downgrade agreements included in the amounts above1			$	624

1.Amount represents arrangements between the Firm and other parties where upon the downgrade of one party, the downgraded party must deliver collateral to the other party. These bilateral downgrade arrangements are used by the Firm to manage the risk of counterparty downgrades.

The additional collateral or termination payments that may be called in the event of a future credit rating downgrade vary by contract and can be based on ratings by Moody’s Investors Service, Inc., S&P Global Ratings and/or other rating agencies. The previous table shows the future potential collateral amounts and termination payments that could be called or required by counterparties or exchange and clearing organizations in the event of one-notch or two-notch

March 2024 Form 10-Q			50

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Table of Contents
Notes to Consolidated Financial Statements (Unaudited)

downgrade scenarios based on the relevant contractual downgrade triggers.

Maximum Potential Payout/Notional of Credit Protection Sold1

			Years to Maturity at March 31, 2024
$ in billions			< 1			1-3			3-5			Over 5			Total
Single-name CDS
Investment grade			$	19		$	29		$	40		$	14		$	102
Non-investment grade			7			14			17			4			42
Total			$	26		$	43		$	57		$	18		$	144
Index and basket CDS
Investment grade			$	8		$	19		$	46		$	7		$	80
Non-investment grade			9			14			77			34			134
Total			$	17		$	33		$	123		$	41		$	214
Total CDS sold			$	43		$	76		$	180		$	59		$	358
Other credit contracts			—			—			—			3			3
Total credit protection sold			$	43		$	76		$	180		$	62		$	361
CDS protection sold with identical protection purchased															$	306

			Years to Maturity at December 31, 2023
$ in billions			< 1			1-3			3-5			Over 5			Total
Single-name CDS
Investment grade			$	19		$	29		$	39		$	10		$	97
Non-investment grade			7			14			17			1			39
Total			$	26		$	43		$	56		$	11		$	136
Index and basket CDS
Investment grade			$	8		$	19		$	85		$	4		$	116
Non-investment grade			8			14			95			17			134
Total			$	16		$	33		$	180		$	21		$	250
Total CDS sold			$	42		$	76		$	236		$	32		$	386
Other credit contracts			—			—			—			3			3
Total credit protection sold			$	42		$	76		$	236		$	35		$	389
CDS protection sold with identical protection purchased															$	330

Fair Value Asset (Liability) of Credit Protection Sold1

$ in millions			At March 31, 2024			At December 31, 2023
Single-name CDS
Investment grade			$	2,167		$	1,904
Non-investment grade			444			399
Total			$	2,611		$	2,303
Index and basket CDS
Investment grade			$	1,829		$	1,929
Non-investment grade			464			45
Total			$	2,293		$	1,974
Total CDS sold			$	4,904		$	4,277
Other credit contracts			276			314
Total credit protection sold			$	5,180		$	4,591

1.Investment grade/non-investment grade determination is based on the internal credit rating of the reference obligation. Internal credit ratings serve as the CRM’s assessment of credit risk and the basis for a comprehensive credit limits framework used to control credit risk. The Firm uses quantitative models and judgment to estimate the various risk parameters related to each obligor.

Protection Purchased with CDS

			Notional
$ in billions			At March 31, 2024			At December 31, 2023
Single name			$	174		$	166
Index and basket			182			213
Tranched index and basket			32			30
Total			$	388		$	409

			Fair Value Asset (Liability)
$ in millions			At March 31, 2024			At December 31, 2023
Single name			$	(3,114)		$	(2,799)
Index and basket			(1,249)			(1,208)
Tranched index and basket			(1,256)			(1,012)
Total			$	(5,619)		$	(5,019)

The Firm enters into credit derivatives, principally CDS, under which it receives or provides protection against the risk of default on a set of debt obligations issued by a specified reference entity or entities. A majority of the Firm’s counterparties for these derivatives are banks, broker-dealers, and insurance and other financial institutions.

The fair value amounts as shown in the previous tables are prior to cash collateral or counterparty netting. For further information on credit derivatives and other credit contracts, see Note 6 to the financial statements in the 2023 Form 10-K.

7. Investment Securities

AFS and HTM Securities

			At March 31, 2024
$ in millions			Amortized Cost1			Gross Unrealized Gains			Gross Unrealized Losses			Fair Value
AFS securities
U.S. Treasury securities			$	59,035		$	49		$	860		$	58,224
U.S. agency securities2			25,232			4			2,726			22,510
Agency CMBS			5,762			—			420			5,342
State and municipal securities			476			18			2			492
FFELP student loan ABS3			755			1			11			745
Total AFS securities			91,260			72			4,019			87,313
HTM securities
U.S. Treasury securities			21,138			—			1,370			19,768
U.S. agency securities2			41,698			6			8,524			33,180
Agency CMBS			1,297			—			122			1,175
Non-agency CMBS			1,287			1			128			1,160
Total HTM securities			65,420			7			10,144			55,283
Total investment securities			$	156,680		$	79		$	14,163		$	142,596

			51			March 2024 Form 10-Q

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Notes to Consolidated Financial Statements (Unaudited)

			At December 31, 2023
$ in millions			Amortized Cost1			Gross Unrealized Gains			Gross Unrealized Losses			Fair Value
AFS securities
U.S. Treasury securities			$	58,484		$	24		$	1,103		$	57,405
U.S. agency securities2			25,852			4			2,528			23,328
Agency CMBS			5,871			—			456			5,415
State and municipal securities			1,132			46			5			1,173
FFELP student loan ABS3			810			—			18			792
Total AFS securities			92,149			74			4,110			88,113
HTM securities
U.S. Treasury securities			23,222			—			1,285			21,937
U.S. agency securities2			40,894			—			7,699			33,195
Agency CMBS			1,337			—			121			1,216
Non-agency CMBS			1,241			2			138			1,105
Total HTM securities			66,694			2			9,243			57,453
Total investment securities			$	158,843		$	76		$	13,353		$	145,566

1.Amounts are net of any ACL.

2.U.S. agency securities consist mainly of agency mortgage pass-through pool securities, CMOs and agency-issued debt.

3.Underlying loans are backed by a guarantee, ultimately from the U.S. Department of Education, of at least 95% of the principal balance and interest outstanding.

AFS Securities in an Unrealized Loss Position

			At March 31, 2024						At December 31, 2023
$ in millions			Fair Value			Gross Unrealized Losses			Fair Value			Gross Unrealized Losses
U.S. Treasury securities
Less than 12 months			$	4,377		$	17		$	14,295		$	22
12 months or longer			30,024			843			33,458			1,081
Total			34,401			860			47,753			1,103
U.S. agency securities
Less than 12 months			2,332			9			4,297			43
12 months or longer			19,050			2,717			18,459			2,485
Total			21,382			2,726			22,756			2,528
Agency CMBS
Less than 12 months			—			—			—			—
12 months or longer			5,102			420			5,415			456
Total			5,102			420			5,415			456
State and municipal securities
Less than 12 months			180			1			524			3
12 months or longer			34			1			35			2
Total			214			2			559			5
FFELP student loan ABS
Less than 12 months			40			1			56			1
12 months or longer			558			10			616			17
Total			598			11			672			18
Total AFS securities in an unrealized loss position
Less than 12 months			6,929			28			19,172			69
12 months or longer			54,768			3,991			57,983			4,041
Total			$	61,697		$	4,019		$	77,155		$	4,110

For AFS securities, the Firm believes there are no securities in an unrealized loss position that have credit losses after performing the analysis described in Note 2 in the 2023 Form 10-K and the Firm expects to recover the amortized cost basis of these securities. Additionally, the Firm does not intend to sell these securities and is not likely to be required to sell these securities prior to recovery of the amortized cost basis.

As of March 31, 2024 and December 31, 2023, the securities in an unrealized loss position are predominantly investment grade.

The HTM securities net carrying amounts at March 31, 2024 and December 31, 2023 reflect an ACL of $41 million and $44 million, respectively, predominantly related to Non-agency CMBS. See Note 2 in the 2023 Form 10-K for a description of the ACL methodology used for HTM Securities. As of March 31, 2024 and December 31, 2023, Non-Agency CMBS HTM securities were predominantly on accrual status and investment grade.

See Note 14 for additional information on securities issued by VIEs, including U.S. agency mortgage-backed securities, non-agency CMBS, and FFELP student loan ABS.

Investment Securities by Contractual Maturity

			At March 31, 2024
$ in millions			Amortized Cost1			Fair Value			Annualized Average Yield2,3
AFS securities
U.S. Treasury securities:
Due within 1 year			$	16,765		$	16,508		1.4		%
After 1 year through 5 years			37,649			37,087			2.9		%
After 5 years through 10 years			4,621			4,629			4.0		%
Total			59,035			58,224
U.S. agency securities:
Due within 1 year			10			9			(0.5)		%
After 1 year through 5 years			349			327			1.6		%
After 5 years through 10 years			509			464			1.8		%
After 10 years			24,364			21,710			3.7		%
Total			25,232			22,510
Agency CMBS:
Due within 1 year			1			1			(2.2)		%
After 1 year through 5 years			2,969			2,861			2.0		%
After 5 years through 10 years			1,615			1,531			1.9		%
After 10 years			1,177			949			1.4		%
Total			5,762			5,342
State and municipal securities:
Due within 1 year			27			27			5.1		%
After 1 year through 5 years			178			179			4.8		%
After 5 years through 10 years			3			5			4.7		%
After 10 Years			268			281			4.5		%
Total			476			492
FFELP student loan ABS:
Due within 1 year			15			14			6.0		%
After 1 year through 5 years			135			131			6.1		%
After 5 years through 10 years			31			31			5.9		%
After 10 years			574			569			6.3		%
Total			755			745
Total AFS securities			91,260			87,313			2.9		%

March 2024 Form 10-Q			52

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Table of Contents
Notes to Consolidated Financial Statements (Unaudited)

			At March 31, 2024
$ in millions			Amortized Cost1			Fair Value			Annualized Average Yield2
HTM securities
U.S. Treasury securities:
Due within 1 year			5,252			5,179			2.1		%
After 1 year through 5 years			13,826			13,063			2.0		%
After 5 years through 10 years			503			412			1.1		%
After 10 years			1,557			1,114			2.3		%
Total			21,138			19,768
U.S. agency securities:
After 1 year through 5 years			5			5			1.8		%
After 5 years through 10 years			277			258			2.1		%
After 10 years			41,416			32,917			1.9		%
Total			41,698			33,180
Agency CMBS:
Due within 1 year			113			110			1.9		%
After 1 year through 5 years			942			867			1.3		%
After 5 years through 10 years			116			97			1.4		%
After 10 years			126			101			1.6		%
Total			1,297			1,175
Non-agency CMBS:
Due within 1 year			194			175			4.1		%
After 1 year through 5 years			391			369			4.7		%
After 5 years through 10 years			621			538			3.7		%
After 10 years			81			78			6.4		%
Total			1,287			1,160
Total HTM securities			65,420			55,283			2.0		%
Total investment securities			156,680			142,596			2.5		%

1.Amounts are net of any ACL.

2.Annualized average yield is computed using the effective yield, weighted based on the amortized cost of each security. The effective yield is shown pre-tax and excludes the effect of related hedging derivatives.

3.At March 31, 2024, the annualized average yield, including the interest rate swap accrual of related hedges, was 2.1% for AFS securities contractually maturing within 1 year and 3.8% for all AFS securities.

Gross Realized Gains (Losses) on Sales of AFS Securities

			Three Months Ended March 31,
$ in millions			2024			2023
Gross realized gains			$	43		$	44
Gross realized (losses)			—			(3)
Total1			$	43		$	41

1.Realized gains and losses are recognized in Other revenues in the income statement.

8. Collateralized Transactions

Offsetting of Certain Collateralized Transactions

			At March 31, 2024
$ in millions			Gross Amounts			Amounts Offset			Balance Sheet Net Amounts			Amounts Not Offset1			Net Amounts
Assets
Securities purchased under agreements to resell			$	293,414		$	(170,681)		$	122,733		$	(118,405)		$	4,328
Securities borrowed			163,755			(30,903)			132,852			(128,658)			4,194
Liabilities
Securities sold under agreements to repurchase			$	253,085		$	(170,681)		$	82,404		$	(74,081)		$	8,323
Securities loaned			46,848			(30,903)			15,945			(15,935)			10
Net amounts for which master netting agreements are not in place or may not be legally enforceable
Securities purchased under agreements to resell															$	4,175
Securities borrowed															447
Securities sold under agreements to repurchase															6,312
Securities loaned															2

			At December 31, 2023
$ in millions			Gross Amounts			Amounts Offset			Balance Sheet Net Amounts			Amounts Not Offset1			Net Amounts
Assets
Securities purchased under agreements to resell			$	300,242		$	(189,502)		$	110,740		$	(108,893)		$	1,847
Securities borrowed			142,453			(21,362)			121,091			(115,969)			5,122
Liabilities
Securities sold under agreements to repurchase			$	252,153		$	(189,502)		$	62,651		$	(58,357)		$	4,294
Securities loaned			36,419			(21,362)			15,057			(15,046)			11
Net amounts for which master netting agreements are not in place or may not be legally enforceable
Securities purchased under agreements to resell															$	1,741
Securities borrowed															607
Securities sold under agreements to repurchase															3,014
Securities loaned															2

1.Amounts relate to master netting agreements that have been determined by the Firm to be legally enforceable in the event of default but where certain other criteria are not met in accordance with applicable offsetting accounting guidance.

For further discussion of the Firm’s collateralized transactions, see Notes 2 and 8 to the financial statements in the 2023 Form 10-K. For information related to offsetting of derivatives, see Note 6.

Gross Secured Financing Balances by Remaining Contractual Maturity

			At March 31, 2024
$ in millions			Overnight and Open			Less than 30 Days			30-90 Days			Over 90 Days			Total
Securities sold under agreements to repurchase			$	70,487		$	113,219		$	31,956		$	37,423		$	253,085
Securities loaned			31,934			—			381			14,533			46,848
Total included in the offsetting disclosure			$	102,421		$	113,219		$	32,337		$	51,956		$	299,933
Trading liabilities— Obligation to return securities received as collateral			8,658			—			—			—			8,658
Total			$	111,079		$	113,219		$	32,337		$	51,956		$	308,591

			53			March 2024 Form 10-Q

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Table of Contents
Notes to Consolidated Financial Statements (Unaudited)

			At December 31, 2023
$ in millions			Overnight and Open			Less than 30 Days			30-90 Days			Over 90 Days			Total
Securities sold under agreements to repurchase			$	80,376		$	114,826		$	25,510		$	31,441		$	252,153
Securities loaned			21,508			1,345			709			12,857			36,419
Total included in the offsetting disclosure			$	101,884		$	116,171		$	26,219		$	44,298		$	288,572
Trading liabilities— Obligation to return securities received as collateral			13,528			—			—			—			13,528
Total			$	115,412		$	116,171		$	26,219		$	44,298		$	302,100

Gross Secured Financing Balances by Class of Collateral Pledged

$ in millions			At March 31, 2024			At December 31, 2023
Securities sold under agreements to repurchase
U.S. Treasury and agency securities			$	84,185		$	98,377
Other sovereign government obligations			131,489			122,342
Corporate equities			23,791			18,144
Other			13,620			13,290
Total			$	253,085		$	252,153
Securities loaned
Other sovereign government obligations			$	1,793		$	1,379
Corporate equities			44,245			34,434
Other			810			606
Total			$	46,848		$	36,419
Total included in the offsetting disclosure			$	299,933		$	288,572
Trading liabilities—Obligation to return securities received as collateral
Corporate equities			$	8,564		$	13,502
Other			94			26
Total			$	8,658		$	13,528
Total			$	308,591		$	302,100

Carrying Value of Assets Loaned or Pledged without Counterparty Right to Sell or Repledge

$ in millions			At March 31, 2024			At December 31, 2023
Trading assets			$	36,461		$	37,522

The Firm pledges certain of its trading assets to collateralize securities sold under agreements to repurchase, securities loaned, other secured financings and derivatives and to cover customer short sales. Counterparties may or may not have the right to sell or repledge the collateral.

Pledged financial instruments that can be sold or repledged by the secured party are identified as Trading assets (pledged to various parties) in the balance sheet.

Fair Value of Collateral Received with Right to Sell or Repledge

$ in millions			At March 31, 2024			At December 31, 2023
Collateral received with right to sell or repledge			$	798,885		$	735,830
Collateral that was sold or repledged1			610,901			553,386

1.Does not include securities used to meet federal regulations for the Firm’s U.S. broker-dealers.

The Firm receives collateral in the form of securities in connection with securities purchased under agreements to resell, securities borrowed, securities-for-securities transactions, derivative transactions, customer margin loans and securities-based lending. In many cases, the Firm is permitted to sell or repledge this collateral to secure securities sold under agreements to repurchase, to enter into securities lending and derivative transactions or to deliver to counterparties to cover short positions.

Securities Segregated for Regulatory Purposes

$ in millions			At March 31, 2024			At December 31, 2023
Segregated securities1			$	24,393		$	20,670

1.Securities segregated under federal regulations for the Firm’s U.S. broker-dealers are sourced from Securities purchased under agreements to resell and Trading assets in the balance sheet.

Customer Margin and Other Lending

$ in millions			At March 31, 2024			At December 31, 2023
Margin and other lending			$	47,464		$	45,644

The Firm provides margin lending arrangements that allow customers to borrow against the value of qualifying securities. Receivables from these arrangements are included within Customer and other receivables in the balance sheet. Under these arrangements, the Firm receives collateral, which includes U.S. government and agency securities, other sovereign government obligations, corporate and other debt, and corporate equities. Margin loans are collateralized by customer-owned securities held by the Firm. The Firm monitors required margin levels and established credit terms daily and, pursuant to such guidelines, requires customers to deposit additional collateral, or reduce positions, when necessary.

For a further discussion of the Firm’s margin lending activities, see Note 8 to the financial statements in the 2023 Form 10-K.

Also included in the amounts in the previous table is non-purpose securities-based lending on entities in the Wealth Management business segment.

Other Secured Financings

The Firm has additional secured liabilities. For a further discussion of other secured financings, see Note 12. Additionally, for certain secured financing transactions that meet applicable netting criteria, the Firm offset Other secured financing liabilities against financing receivables recorded within Trading assets in the amount of $1,798 million at March 31, 2024 and $3,472 million at December 31, 2023.

March 2024 Form 10-Q			54

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Table of Contents
Notes to Consolidated Financial Statements (Unaudited)

9. Loans, Lending Commitments and Related Allowance for Credit Losses

Loans by Type

			At March 31, 2024
$ in millions			HFI Loans			HFS Loans			Total Loans
Corporate			$	7,171		$	9,655		$	16,826
Secured lending facilities			38,692			3,564			42,256
Commercial real estate			8,689			205			8,894
Residential real estate			61,339			2			61,341
Securities-based lending and Other			89,044			—			89,044
Total loans			204,935			13,426			218,361
ACL			(1,141)						(1,141)
Total loans, net			$	203,794		$	13,426		$	217,220
Loans to non-U.S. borrowers, net			$	21,591		$	4,945		$	26,536

			At December 31, 2023
$ in millions			HFI Loans			HFS Loans			Total Loans
Corporate			$	6,758		$	11,862		$	18,620
Secured lending facilities			39,498			3,161			42,659
Commercial real estate			8,678			209			8,887
Residential real estate			60,375			22			60,397
Securities-based lending and Other			89,245			1			89,246
Total loans			204,554			15,255			219,809
ACL			(1,169)						(1,169)
Total loans, net			$	203,385		$	15,255		$	218,640
Loans to non-U.S. borrowers, net			$	21,152		$	5,043		$	26,195

For additional information on the Firm’s held-for-investment and held-for-sale loan portfolios, see Note 9 to the financial statements in the 2023 Form 10-K.

Loans by Interest Rate Type

			At March 31, 2024						At December 31, 2023
$ in millions			Fixed Rate			Floating or Adjustable Rate			Fixed Rate			Floating or Adjustable Rate
Corporate			$	—		$	16,826		$	—		$	18,620
Secured lending facilities			—			42,256			—			42,659
Commercial real estate			142			8,752			141			8,746
Residential real estate			29,335			32,006			28,934			31,464
Securities-based lending and Other			24,024			65,020			23,922			65,323
Total loans, before ACL			$	53,501		$	164,860		$	52,997		$	166,812

See Note 4 for further information regarding Loans and lending commitments held at fair value. See Note 13 for details of current commitments to lend in the future.

Loans Held for Investment before Allowance by Credit Quality and Origination Year

			At March 31, 2024									At December 31, 2023
			Corporate
$ in millions			IG			NIG			Total			IG			NIG			Total
Revolving			$	2,319		$	4,373		$	6,692		$	2,350		$	3,863		$	6,213
2024			—			—			—
2023			—			50			50			—			88			88
2022			—			156			156			—			166			166
2021			15			75			90			15			89			104
2020			28			25			53			29			25			54
Prior			—			130			130			—			133			133
Total			$	2,362		$	4,809		$	7,171		$	2,394		$	4,364		$	6,758

			At March 31, 2024									At December 31, 2023
			Secured Lending Facilities
$ in millions			IG			NIG			Total			IG			NIG			Total
Revolving			$	8,867		$	22,085		$	30,952		$	9,494		$	22,240		$	31,734
2024			—			374			374
2023			1,512			1,392			2,904			1,535			1,459			2,994
2022			385			2,247			2,632			392			2,390			2,782
2021			—			359			359			—			365			365
2020			—			76			76			—			80			80
Prior			355			1,040			1,395			356			1,187			1,543
Total			$	11,119		$	27,573		$	38,692		$	11,777		$	27,721		$	39,498

			At March 31, 2024									At December 31, 2023
			Commercial Real Estate
$ in millions			IG			NIG			Total			IG			NIG			Total
Revolving			$	—		$	170		$	170		$	—		$	170		$	170
2024			—			753			753
2023			365			947			1,312			261			1,067			1,328
2022			282			1,883			2,165			284			1,900			2,184
2021			295			1,554			1,849			370			1,494			1,864
2020			—			755			755			—			756			756
Prior			57			1,628			1,685			195			2,181			2,376
Total			$	999		$	7,690		$	8,689		$	1,110		$	7,568		$	8,678

			At March 31, 2024
			Residential Real Estate
			by FICO Scores												by LTV Ratio									Total
$ in millions			≥ 740			680-739			≤ 679						≤ 80%			> 80%
Revolving			$	113		$	32		$	7					$	151		$	1					$	152
2024			1,590			271			30						1,709			182						1,891
2023			7,248			1,502			225						8,023			952						8,975
2022			10,776			2,409			383						12,490			1,078						13,568
2021			10,948			2,344			236						12,608			920						13,528
2020			6,815			1,409			103						7,901			426						8,327
Prior			11,383			3,091			424						13,813			1,085						14,898
Total			$	48,873		$	11,058		$	1,408					$	56,695		$	4,644					$	61,339

			At December 31, 2023
			Residential Real Estate
			by FICO Scores												by LTV Ratio									Total
$ in millions			≥ 740			680-739			≤ 679						≤ 80%			> 80%
Revolving			$	108		$	33		$	8					$	149		$	—					$	149
2023			7,390			1,517			230						8,168			969						9,137
2022			10,927			2,424			389						12,650			1,090						13,740
2021			11,075			2,376			239						12,763			927						13,690
2020			6,916			1,430			104						8,017			433						8,450
Prior			11,642			3,131			436						14,106			1,103						15,209
Total			$	48,058		$	10,911		$	1,406					$	55,853		$	4,522					$	60,375

			55			March 2024 Form 10-Q

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Table of Contents
Notes to Consolidated Financial Statements (Unaudited)

			At March 31, 2024
			Securities-based Lending1			Other2
$ in millions						IG			NIG			Total
Revolving			$	70,959		$	5,304		$	1,486		$	77,749
2024			231			17			184			432
2023			1,502			621			364			2,487
2022			1,056			526			1,091			2,673
2021			104			251			437			792
2020			39			285			507			831
Prior			222			1,617			2,241			4,080
Total			$	74,113		$	8,621		$	6,310		$	89,044

			December 31, 2023
			Securities-based Lending1			Other2
$ in millions						IG			NIG			Total
Revolving			$	71,474		$	5,230		$	1,362		$	78,066
2023			1,612			627			346			2,585
2022			1,128			816			804			2,748
2021			165			330			377			872
2020			—			435			414			849
Prior			215			2,096			1,814			4,125
Total			$	74,594		$	9,534		$	5,117		$	89,245

IG—Investment Grade

NIG—Non-investment Grade

1. Securities-based loans are subject to collateral maintenance provisions, and at March 31, 2024 and December 31, 2023, these loans are predominantly over-collateralized. For more information on the ACL methodology related to securities-based loans, see Note 2 to the financial statements in the 2023 Form 10-K.

2. Other loans primarily include certain loans originated in the tailored lending business within the Wealth Management business segment, which typically consist of bespoke lending arrangements provided to ultra-high worth net clients. These facilities are generally secured by eligible collateral.

Past Due Loans Held for Investment before Allowance1

$ in millions			At March 31, 2024			At December 31, 2023
Corporate			$	46		$	47
Commercial real estate			291			185
Residential real estate			138			160
Securities-based lending and Other			16			1
Total			$	491		$	393

1.As of March 31, 2024, the majority of the amounts are 90 days or more past due. As of December 31, 2023, the majority of the amounts are past due for a period of less than 90 days.

Nonaccrual Loans Held for Investment before Allowance1

$ in millions			At March 31, 2024			At December 31, 2023
Corporate			$	82		$	95
Secured lending facilities			83			87
Commercial real estate			432			426
Residential real estate			100			95
Securities-based lending and Other			294			174
Total			$	991		$	877
Nonaccrual loans without an ACL			$	88		$	86

1.There were no loans held for investment that were 90 days or more past due and still accruing as of March 31, 2024 and December 31, 2023. For further information on the Firm’s nonaccrual policy, see Note 2 to the financial statements in the 2023 Form 10-K.

See Note 2 to the financial statements in the 2023 Form 10-K for a description of the ACL calculated under the CECL methodology, including credit quality indicators, used for HFI loans.

Loan Modifications to Borrowers Experiencing Financial Difficulty

The Firm may modify the terms of certain loans for economic or legal reasons related to a borrower's financial difficulties, and these modifications include interest rate reductions, principal forgiveness, term extensions and other-than-insignificant payment delays or a combination of these aforementioned modifications. Modified loans are typically evaluated individually for allowance for credit losses. There were no loans held for investment that had been modified in the 12 months prior and subsequently defaulted during the three months ended March 31, 2024.

Modified Loans Held for Investment

Period-end loans held for investment modified during the following periods1:

			Three Months Ended March 31,
			2024									2023
$ in millions			Amortized Cost			% of Total Loans2						Amortized Cost			% of Total Loans2
Term Extension
Corporate			$	52		0.7		%				$	17		0.2		%
Commercial real estate			127			1.5		%				62			0.7		%
Residential real estate			—			—		%				1			—		%
Securities-based lending and Other			41			—		%				—			—		%
Total			$	220		0.2		%				$	80		0.1		%
Other-than-insignificant Payment Delay
Commercial real estate			$	—		—		%				$	67		0.8		%
Total			$	—		—		%				$	67		0.8		%
Multiple Modifications - Term Extension and Other-than-insignificant Payment Delay
Commercial real estate			$	40		0.5		%				$	—		—		%
Total			$	40		0.5		%				$	—		—		%
Total Modifications			$	260		0.2		%				$	147		0.2		%

1.Lending commitments to borrowers for which the Firm has modified terms of the receivable are $301 million and $607 million as of March 31, 2024 and March 31, 2023, respectively.

2.Percentage of total loans represents the percentage of modified loans to total loans held for investment by loan type.

March 2024 Form 10-Q			56

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Table of Contents
Notes to Consolidated Financial Statements (Unaudited)

Financial Effect of Modifications on Loans Held for Investment

			Three Months Ended March 31, 20241
			Term Extension (Months)			Other-than-insignificant Payment Delay (Months)			Principal Forgiveness ($ millions)			Interest Rate Reduction (%)
Single Modifications
Corporate			30			0			$	—		—		%
Commercial real estate			5			0			—			—		%
Securities-based lending and Other			36			0			—			—		%
Multiple Modifications - Term Extension and Other-than-insignificant Payment Delay
Commercial real estate			16			16			$	—		—		%

			Three Months Ended March 31, 20231
			Term Extension (Months)			Other-than-insignificant Payment Delay (Months)			Principal Forgiveness ($ millions)			Interest Rate Reduction (%)
Single Modifications
Corporate			8			0			$	—		—		%
Commercial real estate			2			8			—			—		%
Residential real estate			4			0			—			—		%

1.In instances where more than one loan was modified, modification impact is presented on a weighted-average basis.

Past Due Status for Loans Held for Investment Modified in the Last 12 months

						At March 31, 2024
$ in millions						30-89 Days Past Due			90+ Days Past Due			Total
Commercial real estate						$	—		$	45		45
Total						$	—		$	45		$	45

As of March 31, 2023, there were no past due loans held for investment modified during the 12 months prior.

Allowance for Credit Losses Rollforward and Allocation—Loans and Lending Commitments

			Three Months Ended March 31, 2024
$ in millions			Corporate			Secured Lending Facilities			CRE			Residential Real Estate			SBL and Other			Total
ACL—Loans
Beginning balance			$	241		$	153		$	463		$	100		$	212		$	1,169
Provision (release)			1			(17)			1			(11)			4			(22)
Other			(1)			(1)			(3)			—			(1)			(6)
Ending balance			$	241		$	135		$	461		$	89		$	215		$	1,141
Percent of loans to total loans1			4		%	19		%	4		%	30		%	43		%	100		%
ACL—Lending commitments
Beginning balance			$	431		$	70		$	26		$	4		$	20		$	551
Provision (release)			(2)			25			(3)			—			(4)			16
Other			(3)			(1)			—			—			2			(2)
Ending balance			$	426		$	94		$	23		$	4		$	18		$	565
Total ending balance			$	667		$	229		$	484		$	93		$	233		$	1,706

			Three Months Ended March 31, 2023
$ in millions			Corporate			Secured Lending Facilities			CRE			Residential Real Estate			SBL and Other			Total
ACL—Loans
Beginning balance			$	235		$	153		$	275		$	87		$	89		$	839
Gross charge-offs			(1)			—			(69)			—			(1)			(71)
Provision (release)			31			—			129			26			15			201
Other			—			(1)			—			—			2			1
Ending balance			$	265		$	152		$	335		$	113		$	105		$	970
Percent of loans to total loans1			4		%	18		%	4		%	28		%	46		%	100		%
ACL—Lending commitments
Beginning balance			$	411		$	51		$	15		$	4		$	23		$	504
Provision (release)			22			—			7			1			3			33
Other			2			—			—			—			—			2
Ending balance			$	435		$	51		$	22		$	5		$	26		$	539
Total ending balance			$	700		$	203		$	357		$	118		$	131		$	1,509

CRE—Commercial real estate

SBL—Securities-based lending

1.Percent of loans to total loans represents loans held for investment by loan type to total loans held for investment.

The allowance for credit losses for loans and lending commitments decreased for the three months ended March 31, 2024, reflecting improvements in the macroeconomic outlook. This was partially offset by provisions for certain specific commercial real estate and corporate loans and modest growth in certain other loan portfolios. There were no charge-offs during the three months ended March 31, 2024. During the three months ended March 31, 2023, charge-offs were $71 million, primarily related to commercial real estate loans. The base scenario used in our ACL models as of March 31, 2024 was generated using a combination of consensus economic forecasts, forward rates, and internally developed and validated models. This scenario assumes slow economic growth in 2024, followed by a gradual improvement in 2025, as well as lower credit spreads and interest rates relative to the prior forecast. Given the nature of our lending portfolio, the most sensitive model input is U.S. gross domestic product (“GDP”). For a further discussion of the Firm’s loans as well as the Firm’s allowance methodology, refer to Notes 2 and 9 to the financial statements in the 2023 Form 10-K.

Selected Credit Ratios

			At March 31, 2024			At December 31, 2023
ACL for loans to total HFI loans			0.6		%	0.6		%
Nonaccrual HFI loans to total HFI loans			0.5		%	0.4		%
ACL for loans to nonaccrual HFI loans			115.1		%	133.3		%

			57			March 2024 Form 10-Q

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Table of Contents
Notes to Consolidated Financial Statements (Unaudited)

Employee Loans

$ in millions			At March 31, 2024			At December 31, 2023
Currently employed by the Firm1			$	4,263		$	4,257
No longer employed by the Firm2			90			92
Employee loans			$	4,353		$	4,349
ACL			(121)			(121)
Employee loans, net of ACL			$	4,232		$	4,228
Remaining repayment term, weighted average in years			5.7			5.8

1.These loans are predominantly current.

2.These loans are predominantly past due for a period of 90 days or more.

Employee loans are granted in conjunction with a program established primarily to recruit certain Wealth Management financial advisors, are full recourse and generally require periodic repayments, and are due in full upon termination of employment with the Firm. These loans are recorded in Customer and other receivables in the balance sheet. See Note 2 to the financial statements in the 2023 Form 10-K for a description of the CECL allowance methodology, including credit quality indicators, for employee loans.

10. Other Assets

Equity Method Investments

$ in millions			At March 31, 2024			At December 31, 2023
Investments			$	1,811		$	1,915

			Three Months Ended March 31,
$ in millions			2024			2023
Income (loss)			$	56		$	25

Equity method investments, other than investments in certain fund interests, are summarized above and are included in Other assets in the balance sheet with related income or loss included in Other revenues in the income statement. See “Net Asset Value Measurements—Fund Interests” in Note 4 for the carrying value of certain of the Firm’s fund interests, which are composed of general and limited partnership interests, as well as any related carried interest.

Japanese Securities Joint Venture

			Three Months Ended March 31,
$ in millions			2024			2023
Income (loss) from investment in MUMSS			$	40		$	29

For more information on MUMSS and other relationships with MUFG, see Note 11 to the financial statements in the 2023 Form 10-K.

Tax Equity Investments

The Firm invests in tax equity investment interests which entitle the Firm to a share of tax credits and other income tax benefits generated by the projects underlying the investments.

Effective January 1, 2024, the Firm made an election to account for certain renewable energy and other tax equity investments programs using the proportional amortization method under newly adopted accounting guidance.

Tax Equity Investments under the Proportional Amortization Method

$ in millions			At March 31, 2024			At December 31, 2023
Low-income housing			$	1,764		$	1,699
Renewable energy and other1			39			—
Total2			$	1,803		$	1,699

1.Prior to adoption of the Investments - Tax Credit Structures accounting update on January 1, 2024, Renewable energy and other investments were accounted for under the equity method.

2.At March 31, 2024, this amount excludes $46 million of tax equity investments within programs for which the Firm elected the proportional amortization method that do not meet the conditions to apply the proportional amortization method, which are accounted for as equity method investments.

Income tax credits and other income tax benefits recognized as well as proportional amortization are included in the Provision for income taxes line in the consolidated income statement and in the Depreciation and amortization line in the consolidated cash flow statement.

Net Benefits Attributable to Tax Equity Investments under the Proportional Amortization Method

			Three Months Ended March 31,
$ in millions			2024			2023
Income tax credits and other income tax benefits			$	75		$	71
Proportional amortization			(60)			(49)
Net benefits			$	15		$	22

11. Deposits

Deposits

$ in millions			At March 31, 2024			At December 31, 2023
Savings and demand deposits			$	288,453		$	288,252
Time deposits			64,041			63,552
Total			$	352,494		$	351,804
Deposits subject to FDIC insurance			$	276,557		$	276,598
Deposits not subject to FDIC insurance			$	75,937		$	75,206

Time Deposit Maturities

$ in millions			At March 31, 2024
2024			$	27,808
2025			19,452
2026			7,091
2027			4,604
2028			3,982
Thereafter			1,104
Total			$	64,041

March 2024 Form 10-Q			58

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12. Borrowings and Other Secured Financings

Borrowings

$ in millions			At March 31, 2024			At December 31, 2023
Original maturities of one year or less			$	5,233		$	3,188
Original maturities greater than one year
Senior			$	252,547		$	248,174
Subordinated			13,603			12,370
Total greater than one year			$	266,150		$	260,544
Total			$	271,383		$	263,732
Weighted average stated maturity, in years1			6.6			6.6

1.Only includes borrowings with original maturities greater than one year.

Other Secured Financings

$ in millions			At March 31, 2024			At December 31, 2023
Original maturities:
One year or less			$	8,914		$	5,732
Greater than one year			6,177			6,923
Total			$	15,091		$	12,655
Transfers of assets accounted for as secured financings			$	7,053		$	5,848

Other secured financings include the liabilities related to collateralized notes, transfers of financial assets that are accounted for as financings rather than sales and consolidated VIEs where the Firm is deemed to be the primary beneficiary. These liabilities are generally payable from the cash flows of the related assets accounted for as Trading assets. See Note 14 for further information on other secured financings related to VIEs and securitization activities.

For transfers of assets that fail to meet accounting criteria for a sale, the Firm continues to record the assets and recognizes the associated liabilities in the balance sheet.

13. Commitments, Guarantees and Contingencies

Commitments

			Years to Maturity at March 31, 2024
$ in millions			Less than 1			1-3			3-5			Over 5			Total
Lending:
Corporate			$	15,091		$	35,055		$	58,740		$	4,230		$	113,116
Secured lending facilities			8,167			6,891			4,319			4,465			23,842
Commercial and Residential real estate			214			21			14			481			730
Securities-based lending and Other			16,013			3,165			377			443			19,998
Forward-starting secured financing receivables1			88,826			—			—			—			88,826
Central counterparty			300			—			—			12,861			13,161
Investment activities			1,709			120			73			524			2,426
Letters of credit and other financial guarantees			68			15			—			7			90
Total			$	130,388		$	45,267		$	63,523		$	23,011		$	262,189
Lending commitments participated to third parties															$	8,348

1.Forward-starting secured financing receivables are generally settled within three business days.

Since commitments associated with these instruments may expire unused, the amounts shown do not necessarily reflect the actual future cash funding requirements.

For a further description of these commitments, refer to Note 14 to the financial statements in the 2023 Form 10-K.

Guarantees

			At March 31, 2024
			Maximum Potential Payout/Notional of Obligations by Years to Maturity															Carrying Amount Asset (Liability)
$ in millions			Less than 1			1-3			3-5			Over 5
Non-credit derivatives1			$	1,576,169		$	748,245		$	155,224		$	458,033					$	(33,732)
Standby letters of credit and other financial guarantees issued2,3			1,726			1,152			1,236			2,561						2
Liquidity facilities			2,193			—			—			—						(1)
Whole loan sales guarantees			2			85			—			23,074						—
Securitization representations and warranties4			—			—			—			82,349						(3)
General partner guarantees			412			32			133			28						(87)
Client clearing guarantees			208			—			—			—						—

1.The carrying amounts of derivative contracts that meet the accounting definition of a guarantee are shown on a gross basis. For further information on derivatives contracts, see Note 6.

2.These amounts include certain issued standby letters of credit participated to third parties, totaling $0.7 billion of notional and collateral/recourse, due to the nature of the Firm’s obligations under these arrangements.

3.As of March 31, 2024, the carrying amount of standby letters of credit and other financial guarantees issued includes an allowance for credit losses of $72 million.

4.Related to commercial and residential mortgage securitizations.

The Firm has obligations under certain guarantee arrangements, including contracts and indemnification agreements, that contingently require the Firm to make payments to the guaranteed party based on changes in an underlying measure (such as an interest or foreign exchange rate, security or commodity price, an index, or the occurrence or non-occurrence of a specified event) related to an asset, liability or equity security of a guaranteed party. Also included as guarantees are contracts that contingently require the Firm to make payments to the guaranteed party based on another entity’s failure to perform under an agreement, as well as indirect guarantees of the indebtedness of others.

For more information on the nature of the obligations and related business activities for our guarantees, see Note 14 to the financial statements in the 2023 Form 10-K.

Other Guarantees and Indemnities

In the normal course of business, the Firm provides guarantees and indemnifications in a variety of transactions. These provisions generally are standard contractual terms. Certain of these guarantees and indemnifications related to indemnities, exchange and clearinghouse member guarantees and merger and acquisition guarantees are described in Note 14 to the financial statements in the 2023 Form 10-K.

			59			March 2024 Form 10-Q

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In addition, in the ordinary course of business, the Firm guarantees the debt and/or certain trading obligations (including obligations associated with derivatives, foreign exchange contracts and the settlement of physical commodities) of certain subsidiaries. These guarantees generally are entity or product specific and are required by investors or trading counterparties. The activities of the Firm’s subsidiaries covered by these guarantees (including any related debt or trading obligations) are included in the financial statements.

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.

Contingencies

Legal

In addition to the matters described below, in the normal course of business, the Firm has been named, from time to time, as a defendant in various legal actions, including arbitrations, class actions and other litigation, arising in connection with its activities as a global diversified financial services institution. Certain of the actual or threatened legal actions include claims for substantial compensatory and/or punitive damages or claims for indeterminate amounts of damages. In some cases, the third-party entities that are, or would otherwise be, the primary defendants in such cases are bankrupt, in financial distress, or may not honor applicable indemnification obligations. These actions have included, but are not limited to, antitrust claims, claims under various false claims act statutes, and matters arising from our sales and trading businesses and our activities in the capital markets.

The Firm is also involved, from time to time, in other reviews, investigations and proceedings (both formal and informal) by governmental or other regulatory agencies regarding the Firm’s business, and involving, among other matters, sales, trading, financing, prime brokerage, market-making activities, investment banking advisory services, capital markets activities, financial products or offerings sponsored, underwritten or sold by the Firm, wealth and investment management services, and accounting and operational matters, certain of which may result in adverse judgments, settlements, fines, penalties, disgorgement, restitution, forfeiture, injunctions, limitations on our ability to conduct certain business, or other relief.

The Firm contests liability and/or the amount of damages as appropriate in each pending matter. Where available information indicates that it is probable a liability had been incurred at the date of the financial statements and the Firm can reasonably estimate the amount of that loss or the range of loss, the Firm accrues an estimated loss by a charge to

income, including with respect to certain of the individual proceedings or investigations described below.

			Three Months Ended March 31,
$ in millions			2024			2023
Legal expenses			$	(26)		$	151

The Firm’s legal expenses can, and may in the future, fluctuate from period to period, given the current environment regarding government or regulatory agency investigations and private litigation affecting global financial services firms, including the Firm.

In many legal proceedings and investigations, it is inherently difficult to determine whether any loss is probable or reasonably possible, or to estimate the amount of any loss. In addition, even where the Firm has determined that a loss is probable or reasonably possible or an exposure to loss or range of loss exists in excess of the liability already accrued with respect to a previously recognized loss contingency, the Firm may be unable to reasonably estimate the amount of the loss or range of loss. It is particularly difficult to determine if a loss is probable or reasonably possible, or to estimate the amount of loss, where the factual record is being developed or contested or where plaintiffs or government entities seek substantial or indeterminate damages, restitution, forfeiture, disgorgement or penalties. Numerous issues may need to be resolved in an investigation or proceeding before a determination can be made that a loss or additional loss (or range of loss or range of additional loss) is probable or reasonably possible, or to estimate the amount of loss, including through potentially lengthy discovery or determination of important factual matters, determination of issues related to class certification, the calculation of damages or other relief, and consideration of novel or unsettled legal questions relevant to the proceedings or investigations in question.

The Firm has identified below any individual proceedings or investigations where the Firm believes a material loss to be reasonably possible. In certain legal proceedings in which the Firm has determined that a material loss is reasonably possible, the Firm is unable to reasonably estimate the loss or range of loss. There are other matters in which the Firm has determined a loss or range of loss to be reasonably possible, but the Firm does not believe, based on current knowledge and after consultation with counsel, that such losses could have a material adverse effect on the Firm’s financial statements as a whole, although the outcome of such proceedings or investigations may significantly impact the Firm’s business or results of operations for any particular reporting period, or cause significant reputational harm.

While the Firm has identified below certain proceedings or investigations that the Firm believes to be material, individually or collectively, there can be no assurance that material losses will not be incurred from claims that have not

March 2024 Form 10-Q			60

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yet been asserted or those where potential losses have not yet been determined to be probable or reasonably possible.

Antitrust Related Matters

The Firm and other financial institutions are responding to a number of governmental investigations and civil litigation matters related to allegations of anticompetitive conduct in various aspects of the financial services industry, including the matters described below.

Beginning in February of 2016, the Firm was named as a defendant in multiple purported antitrust class actions now consolidated into a single proceeding in the United States District Court for the Southern District of New York (“SDNY”) styled In Re: Interest Rate Swaps Antitrust Litigation. Plaintiffs allege, inter alia, that the Firm, together with a number of other financial institution defendants, violated U.S. and New York state antitrust laws from 2008 through December of 2016 in connection with their alleged efforts to prevent the development of electronic exchange-based platforms for interest rate swaps trading. Complaints were filed both on behalf of a purported class of investors who purchased interest rate swaps from defendants, as well as on behalf of three operators of swap execution facilities that allegedly were thwarted by the defendants in their efforts to develop such platforms. The consolidated complaints seek, among other relief, certification of the investor class of plaintiffs and treble damages. On July 28, 2017, the court granted in part and denied in part the defendants’ motion to dismiss the complaints. On December 15, 2023, the court denied the class plaintiffs’ motion for class certification. On December 29, 2023, the class plaintiffs petitioned the United States Court of Appeals for the Second Circuit for leave to appeal that decision. On February 28, 2024, the parties reached an agreement in principle to settle the class claims.

In August of 2017, the Firm was named as a defendant in a purported antitrust class action in the United States District Court for the SDNY styled Iowa Public Employees’ Retirement System et al. v. Bank of America Corporation et al. Plaintiffs allege, inter alia, that the Firm, together with a number of other financial institution defendants, violated U.S. antitrust laws and New York state law in connection with their alleged efforts to prevent the development of electronic exchange-based platforms for securities lending. The class action complaint was filed on behalf of a purported class of borrowers and lenders who entered into stock loan transactions with the defendants. The class action complaint seeks, among other relief, certification of the class of plaintiffs and treble damages. On September 27, 2018, the court denied the defendants’ motion to dismiss the class action complaint. Plaintiffs’ motion for class certification was referred by the District Court to a magistrate judge who, on June 30, 2022, issued a report and recommendation that the District Court certify a class. On May 20, 2023, the Firm reached an agreement in principle to settle the litigation. On

September 1, 2023, the court granted preliminary approval of the settlement.

The Firm is a defendant in three antitrust class action complaints which have been consolidated into one proceeding in the United States District Court for the SDNY under the caption City of Philadelphia, et al. v. Bank of America Corporation, et al. Plaintiffs allege, inter alia, that the Firm, along with a number of other financial institution defendants, violated U.S. antitrust laws and relevant state laws in connection with alleged efforts to artificially inflate interest rates for Variable Rate Demand Obligations (“VRDO”). Plaintiffs seek, among other relief, treble damages. The class action complaint was filed on behalf of a class of municipal issuers of VRDO for which defendants served as remarketing agent. On November 2, 2020, the court granted in part and denied in part the defendants’ motion to dismiss the consolidated complaint, dismissing state law claims, but denying dismissal of the U.S. antitrust claims. On September 21, 2023, the court granted plaintiffs’ motion for class certification. On October 5, 2023, defendants petitioned the United States Court of Appeals for the Second Circuit for leave to appeal that decision, which was granted on February 5, 2024.

Qui Tam Matters

The Firm and other financial institutions are defending against qui tam litigations brought under various state false claims statutes, including the matter described below. Such matters may involve the same types of claims pursued in multiple jurisdictions and may include claims for treble damages.

On August 18, 2009, Relators Roger Hayes and C. Talbot Heppenstall, Jr., filed a qui tam action in New Jersey state court styled State of New Jersey ex. rel. Hayes v. Bank of America Corp., et al. The complaint, filed under seal pursuant to the New Jersey False Claims Act, alleged that the Firm and several other underwriters of municipal bonds had defrauded New Jersey issuers by misrepresenting that they would achieve the best price or lowest cost of capital in connection with certain municipal bond issuances. On March 17, 2016, the court entered an order unsealing the complaint. On November 17, 2017, Relators filed an amended complaint to allege the Firm mispriced certain bonds issued in twenty-three bond offerings between 2008 and 2017, having a total par amount of $6.9 billion. The complaint seeks, among other relief, treble damages. On February 22, 2018, the Firm moved to dismiss the amended complaint, and on July 17, 2018, the court denied the Firm’s motion. On October 13, 2021, following a series of voluntary and involuntary dismissals, Relators limited their claims to certain bonds issued in five offerings the Firm underwrote between 2008 and 2011, having a total par amount of $3.9 billion. On August 22, 2023, the Firm reached an agreement in principle to settle the litigation. The final agreement became effective on January 30, 2024.

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European Matters

Tax

In matters styled Case number 15/3637 and Case number 15/4353, the Dutch Tax Authority (“Dutch Authority”) is challenging in the Dutch courts the prior set-off by the Firm of approximately €124 million (approximately $134 million) plus accrued interest of withholding tax credits against the Firm’s corporation tax liabilities for the tax years 2007 to 2012. The Dutch Authority alleges that the Firm was not entitled to receive the withholding tax credits on the basis, inter alia, that a Firm subsidiary did not hold legal title to certain securities subject to withholding tax on the relevant dates. The Dutch Authority has also alleged that the Firm failed to provide certain information to the Dutch Authority and to keep adequate books and records. On April 26, 2018, the District Court in Amsterdam issued a decision dismissing the Dutch Authority’s claims with respect to certain of the tax years in dispute. On May 12, 2020, the Court of Appeal in Amsterdam granted the Dutch Authority's appeal in matters re-styled Case number 18/00318 and Case number 18/00319. On January 19, 2024, the Dutch High Court granted the Firm’s appeal in matters re-styled Case number 20/01884 and referred the case to the Court of Appeal in The Hague.

On June 22, 2021, Dutch criminal authorities sought various documents in connection with an investigation of the Firm related to the civil claims asserted by the Dutch Authority concerning the accuracy of the Firm subsidiary’s tax returns and the maintenance of its books and records for 2007 to 2012. The Dutch criminal authorities have requested additional information, and the Firm is continuing to respond to them in connection with their ongoing investigation.

Danish Underwriting Matter

On October 5, 2017, various institutional investors filed a claim against the Firm and another bank in a matter now styled Case number B-803-18 (previously BS 99-6998/2017), in the City Court of Copenhagen, Denmark concerning their roles as underwriters of the initial public offering (“IPO”) in March 2014 of the Danish company OW Bunker A/S. The claim seeks damages of approximately DKK529 million (approximately $77 million) plus interest in respect of alleged losses arising from investing in shares in OW Bunker, which entered into bankruptcy in November 2014. Separately, on November 29, 2017, another group of institutional investors joined the Firm and another bank as defendants to pending proceedings in the High Court of Eastern Denmark against various other parties involved in the IPO in a matter styled Case number B-2073-16. The claim brought against the Firm and the other bank has been given its own Case number B-2564-17. The investors claim damages of approximately DKK767 million (approximately $111 million) plus interest from the Firm and the other bank on a joint and several basis with the Defendants to these proceedings. Both claims are based on alleged prospectus liability; the second claim also

alleges professional liability of banks acting as financial intermediaries. On June 8, 2018, the City Court of Copenhagen, Denmark ordered that the matters now styled Case number B-803-18, Case number B-2073-16, and Case number B-2564-17 be heard together before the High Court of Eastern Denmark. On June 29, 2018, the Firm filed its defense to the matter now styled Case number B-2564-17. On February 4, 2019, the Firm filed its defense to the matter now styled Case number B-803-18.

U.K. Government Bond Matter

The Firm is engaging with the UK Competition and Markets Authority in connection with its investigation of suspected anti-competitive arrangements in the financial services sector, specifically regarding the Firm's activities concerning certain liquid fixed income products between 2009 and 2012. On May 24, 2023, the U.K. Competition and Markets Authority issued a Statement of Objections setting out its provisional findings that the Firm had breached U.K. competition law by sharing competitively sensitive information in connection with gilts and gilt asset swaps between 2009 and 2012. The Firm is contesting the provisional findings. Separately, on June 16, 2023, the Firm was named as a defendant in a purported antitrust class action in the United States District Court for the SDNY styled Oklahoma Firefighters Pension and Retirement System v. Deutsche Bank Aktiengesellschaft, et al., alleging, inter alia, that the Firm, together with a number of other financial institution defendants, violated U.S. antitrust laws in connection with their alleged effort to fix prices of gilts traded in the United States between 2009 and 2013. On September 28, 2023, the defendants filed a joint motion to dismiss the complaint, which has been fully briefed.

Other

On August 13, 2021, the plaintiff in Camelot Event Driven Fund, a Series of Frank Funds Trust v. Morgan Stanley & Co. LLC, et al. filed in the Supreme Court of the State of New York, New York County ("Supreme Court of NY") a purported class action complaint alleging violations of the federal securities laws against ViacomCBS (“Viacom”), certain of its officers and directors, and the underwriters, including the Firm, of two March 2021 Viacom offerings: a $1.7 billion Viacom Class B Common Stock offering and a $1 billion offering of 5.75% Series A Mandatory Convertible Preferred Stock (collectively, the “Offerings”). The complaint alleges, inter alia, that the Viacom offering documents for both issuances contained material omissions because they did not disclose that certain of the underwriters, including the Firm, had prime brokerage relationships and/or served as counterparties to certain derivative transactions with Archegos Capital Management LP, (“Archegos”), a fund with significant exposure to Viacom securities across multiple prime brokers. The complaint, which seeks, among other things, unspecified compensatory damages, alleges that the offering documents did not adequately disclose the risks associated with Archegos’s concentrated Viacom positions at

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the various prime brokers, including that the unwind of those positions could have a deleterious impact on the stock price of Viacom. On November 5, 2021, the complaint was amended to add allegations that defendants failed to disclose that certain underwriters, including the Firm, had intended to unwind Archegos’s Viacom positions while simultaneously distributing the Offerings. On February 6, 2023, the court issued a decision denying the motions to dismiss as to the Firm and the other underwriters, but granted the motion to dismiss as to Viacom and the Viacom individual defendants. On February 15, 2023, the underwriters, including the Firm, filed their notices of appeal of the denial of their motions to dismiss. On March 10, 2023, the plaintiff appealed the dismissal of Viacom and the individual Viacom defendants. On April 4, 2024, the Appellate Division upheld the lower court’s decision as to the Firm and other underwriter defendants that had prime brokerage relationships and/or served as counterparties to certain derivative transactions with Archegos, dismissed the remaining underwriters, and upheld the dismissal of Viacom and its officers and directors. On January 4, 2024, the court granted the plaintiff’s motion for class certification. On February 14, 2024, the defendants filed their notice of appeal of the court’s grant of class certification.

On May 17, 2013, the plaintiff in IKB International S.A. in Liquidation, et al. v. Morgan Stanley, et al. filed a complaint against the Firm and certain affiliates in the Supreme Court of NY. The complaint alleges that defendants made material misrepresentations and omissions in the sale to plaintiff of certain mortgage pass-through certificates backed by securitization trusts containing residential mortgage loans. The total amount of certificates allegedly sponsored, underwritten and/or sold by the Firm to plaintiffs was approximately $133 million. The complaint alleges causes of action against the Firm for common law fraud, fraudulent concealment, aiding and abetting fraud, and negligent misrepresentation, and seeks, among other things, compensatory and punitive damages. On October 29, 2014, the court granted in part and denied in part the Firm’s motion to dismiss. All claims regarding four certificates were dismissed. After these dismissals, the remaining amount of certificates allegedly issued by the Firm or sold to plaintiffs by the Firm was approximately $116 million. On August 11, 2016, the Appellate Division affirmed the trial court’s order denying in part the Firm’s motion to dismiss the complaint. On July 15, 2022, the Firm filed a motion for summary judgment on all remaining claims. On March 1, 2023, the court granted in part and denied in part the Firm’s motion for summary judgment, narrowing the alleged misrepresentations at issue in the case. On March 26, 2024, the Appellate Division affirmed the trial court’s summary judgment order.

14. Variable Interest Entities and Securitization Activities

Consolidated VIE Assets and Liabilities by Type of Activity

			At March 31, 2024						At December 31, 2023
$ in millions			VIE Assets			VIE Liabilities			VIE Assets			VIE Liabilities
MABS1			$	741		$	258		$	597		$	256
Investment vehicles2			807			508			753			502
MTOB			525			483			582			520
Other			442			124			378			97
Total			$	2,515		$	1,373		$	2,310		$	1,375

MTOB—Municipal tender option bonds

1.Amounts include transactions backed by residential mortgage loans, commercial mortgage loans and other types of assets, including consumer or commercial assets and may be in loan or security form. The value of assets is determined based on the fair value of the liabilities and the interests owned by the Firm in such VIEs as the fair values for the liabilities and interests owned are more observable.

2.Amounts include investment funds and CLOs.

Consolidated VIE Assets and Liabilities by Balance Sheet Caption

$ in millions			At March 31, 2024			At December 31, 2023
Assets
Cash and cash equivalents			$	181		$	164
Trading assets at fair value			1,998			1,557
Investment securities			237			492
Securities purchased under agreements to resell			67			67
Customer and other receivables			29			26
Other assets			3			4
Total			$	2,515		$	2,310
Liabilities
Other secured financings			$	1,184		$	1,222
Other liabilities and accrued expenses			131			121
Borrowings			58			32
Total			$	1,373		$	1,375
Noncontrolling interests			$	60		$	54

Consolidated VIE assets and liabilities are presented in the previous tables after intercompany eliminations. Generally, most assets owned by consolidated VIEs cannot be removed unilaterally by the Firm and are not available to the Firm while the related liabilities issued by consolidated VIEs are non-recourse to the Firm. However, in certain consolidated VIEs, the Firm either has the unilateral right to remove assets or provides additional recourse through derivatives such as total return swaps, guarantees or other forms of involvement.

In general, the Firm’s exposure to loss in consolidated VIEs is limited to losses that would be absorbed on the VIE net assets recognized in its financial statements, net of amounts absorbed by third-party variable interest holders.

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Non-consolidated VIEs

			At March 31, 2024
$ in millions			MABS1			CDO			MTOB			OSF			Other2
VIE assets (UPB)			$	151,575		$	1,877		$	3,311		$	2,919		$	56,401
Maximum exposure to loss3
Debt and equity interests			$	22,367		$	104		$	—		$	2,131		$	9,192
Derivative and other contracts			—			—			2,193			—			4,076
Commitments, guarantees and other			3,887			—			—			—			160
Total			$	26,254		$	104		$	2,193		$	2,131		$	13,428
Carrying value of variable interests—Assets
Debt and equity interests			$	22,368		$	104		$	—		$	1,713		$	9,192
Derivative and other contracts			—			—			2			—			1,394
Total			$	22,368		$	104		$	2		$	1,713		$	10,586
Additional VIE assets owned4															$	14,797
Carrying value of variable interests—Liabilities
Derivative and other contracts			$	—		$	—		$	4		$	—		$	367
Total			$	—		$	—		$	4		$	—		$	367

			At December 31, 2023
$ in millions			MABS1			CDO			MTOB			OSF			Other2
VIE assets (UPB)			$	144,906		$	1,526		$	3,152		$	3,102		$	50,052
Maximum exposure to loss3
Debt and equity interests			$	21,203		$	52		$	—		$	2,049		$	9,076
Derivative and other contracts			—			—			2,092			—			4,452
Commitments, guarantees and other			3,439			—			—			—			55
Total			$	24,642		$	52		$	2,092		$	2,049		$	13,583
Carrying value of variable interests–Assets
Debt and equity interests			$	21,203		$	52		$	—		$	1,682		$	9,075
Derivative and other contracts			—			—			2			—			1,330
Total			$	21,203		$	52		$	2		$	1,682		$	10,405
Additional VIE assets owned4															$	15,002
Carrying value of variable interests—Liabilities
Derivative and other contracts			$	—		$	—		$	3		$	—		$	452

1.Amounts include transactions backed by residential mortgage loans, commercial mortgage loans and other types of assets, including consumer or commercial assets, and may be in loan or security form.

2.Other primarily includes exposures to commercial real estate property and investment funds.

3.Where notional amounts are utilized in quantifying the maximum exposure related to derivatives, such amounts do not reflect changes in fair value recorded by the Firm.

4.Additional VIE assets owned represents the carrying value of total exposure to non-consolidated VIEs for which the maximum exposure to loss is less than specific thresholds, primarily interests issued by securitization SPEs. The Firm’s maximum exposure to loss generally equals the fair value of the assets owned. These assets are primarily included in Trading assets and Investment securities and are measured at fair value (see Note 4). The Firm does not provide additional support in these transactions through contractual facilities, guarantees or similar derivatives.

The previous tables include VIEs sponsored by unrelated parties, as well as VIEs sponsored by the Firm; examples of the Firm’s involvement with these VIEs include its secondary market-making activities and the securities held in its Investment securities portfolio (see Note 7).

The Firm’s maximum exposure to loss is dependent on the nature of the Firm’s variable interest in the VIE and is limited to the notional amounts of certain liquidity facilities and other credit support, total return swaps and written put options, as well as the fair value of certain other derivatives and investments the Firm has made in the VIE.

The Firm’s maximum exposure to loss in the previous tables does not include the offsetting benefit of hedges or any

reductions associated with the amount of collateral held as part of a transaction with the VIE or any party to the VIE directly against a specific exposure to loss.

Liabilities issued by VIEs generally are non-recourse to the Firm.

Detail of Mortgage- and Asset-Backed Securitization Assets

			At March 31, 2024						At December 31, 2023
$ in millions			UPB			Debt and Equity Interests			UPB			Debt and Equity Interests
Residential mortgages			$	17,323		$	3,067		$	17,346		$	3,355
Commercial mortgages			79,998			8,805			74,590			8,342
U.S. agency collateralized mortgage obligations			43,012			6,442			42,917			6,675
Other consumer or commercial loans			11,242			4,053			10,053			2,831
Total			$	151,575		$	22,367		$	144,906		$	21,203

Transferred Assets with Continuing Involvement

			At March 31, 2024
$ in millions			RML			CML			U.S. Agency CMO			CLN and Other1
SPE assets (UPB)2,3			$	4,887		$	72,446		$	14,659		$	13,094
Retained interests
Investment grade			$	161		$	652		$	556		$	—
Non-investment grade			95			743			—			65
Total			$	256		$	1,395		$	556		$	65
Interests purchased in the secondary market3
Investment grade			$	18		$	37		$	48		$	—
Non-investment grade			—			13			—			—
Total			$	18		$	50		$	48		$	—
Derivative assets			$	—		$	—		$	—		$	1,159
Derivative liabilities			—			—			—			378

			At December 31, 2023
$ in millions			RML			CML			U.S. Agency CMO			CLN and Other1
SPE assets (UPB)2,3			$	4,333		$	73,818		$	12,083		$	12,438
Retained interests
Investment grade			$	149		$	653		$	460		$	—
Non-investment grade			83			788			—			69
Total			$	232		$	1,441		$	460		$	69
Interests purchased in the secondary market3
Investment grade			$	20		$	22		$	42		$	—
Non-investment grade			—			16			—			—
Total			$	20		$	38		$	42		$	—
Derivative assets			$	—		$	—		$	—		$	1,073
Derivative liabilities			—			—			—			426

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			Fair Value At March 31, 2024
$ in millions			Level 2			Level 3			Total
Retained interests
Investment grade			$	667		$	—		$	667
Non-investment grade			15			67			82
Total			$	682		$	67		$	749
Interests purchased in the secondary market3
Investment grade			$	103		$	—		$	103
Non-investment grade			10			3			13
Total			$	113		$	3		$	116
Derivative assets			$	1,159		$	—		$	1,159
Derivative liabilities			378			—			378

			Fair Value at December 31, 2023
$ in millions			Level 2			Level 3			Total
Retained interests
Investment grade			$	576		$	—		$	576
Non-investment grade			10			56			66
Total			$	586		$	56		$	642
Interests purchased in the secondary market3
Investment grade			$	77		$	7		$	84
Non-investment grade			12			4			16
Total			$	89		$	11		$	100
Derivative assets			$	1,073		$	—		$	1,073
Derivative liabilities			426			—			426

RML—Residential mortgage loans

CML—Commercial mortgage loans

1.Amounts include CLO transactions managed by unrelated third parties.

2.Amounts include assets transferred by unrelated transferors.

3.Amounts include transactions where the Firm also holds retained interests as part of the transfer.

The previous tables include transactions with SPEs in which the Firm, acting as principal, transferred financial assets with continuing involvement and received sales treatment. The transferred assets are carried at fair value prior to securitization, and any changes in fair value are recognized in the income statement. The Firm may act as underwriter of the beneficial interests issued by these securitization vehicles, for which Investment banking revenues are recognized. The Firm may retain interests in the securitized financial assets as one or more tranches of the securitization. Certain retained interests are carried at fair value in the balance sheet with changes in fair value recognized in the income statement. Fair value for these interests is measured using techniques that are consistent with the valuation techniques applied to the Firm’s major categories of assets and liabilities as described in Note 2 in the 2023 Form 10-K and Note 4 herein. Further, as permitted by applicable guidance, certain transfers of assets where the Firm’s only continuing involvement is a derivative are only reported in the following Assets Sold with Retained Exposure table.

Proceeds from New Securitization Transactions and Sales of Loans

						Three Months Ended March 31,
$ in millions									2024			2023
New transactions1									$	6,550		$	2,521
Retained interests									2,099			1,575

1.Net gains on new transactions and sales of corporate loans to CLO entities at the time of the sale were not material for all periods presented.

2.Sponsored by non-affiliates.

The Firm has provided, or otherwise agreed to be responsible for, representations and warranties regarding certain assets transferred in securitization transactions sponsored by the Firm (see Note 13).

Assets Sold with Retained Exposure

$ in millions			At March 31, 2024			At December 31, 2023
Gross cash proceeds from sale of assets1			$	68,566		$	60,766
Fair value
Assets sold			$	70,956		$	62,221
Derivative assets recognized in the balance sheet			2,527			1,546
Derivative liabilities recognized in the balance sheet			140			93

1.The carrying value of assets derecognized at the time of sale approximates gross cash proceeds.

The Firm enters into transactions in which it sells securities, primarily equities, and contemporaneously enters into bilateral OTC derivatives with the purchasers of the securities, through which it retains exposure to the sold securities.

For a discussion of the Firm’s VIEs, the determination and structure of VIEs and securitization activities, see Note 15 to the financial statements in the 2023 Form 10-K.

15. Regulatory Requirements

Regulatory Capital Framework and Requirements

For a discussion of the Firm’s regulatory capital framework, see Note 16 to the financial statements in the 2023 Form 10-K.

The Firm is required to maintain minimum risk-based and leverage-based capital ratios under regulatory capital requirements. A summary of the calculations of regulatory capital and RWA follows.

Risk-Based Regulatory Capital. Risk-based capital ratio requirements apply to Common Equity Tier 1 (“CET1”) capital, Tier 1 capital and Total capital (which includes Tier 2 capital), each as a percentage of RWA, and consist of regulatory minimum required ratios plus the Firm’s capital buffer requirement. Capital requirements require certain adjustments to, and deductions from, capital for purposes of determining these ratios. At March 31, 2024 and December 31, 2023, the differences between the actual and required ratios were lower under the Standardized Approach.

CECL Deferral. Beginning on January 1, 2020, the Firm elected to defer the effect of the adoption of CECL on its risk-based and leverage-based capital amounts and ratios, as well as RWA, adjusted average assets and supplementary leverage exposure calculations, over a five-year transition period. The deferral impacts began to phase in at 25% per year from January 1, 2022 and are phased-in at 75% from January 1,

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Notes to Consolidated Financial Statements (Unaudited)

2024. The deferral impacts will become fully phased-in beginning on January 1, 2025.

Capital Buffer Requirements

			At March 31, 2024 and December 31, 2023
			Standardized			Advanced
Capital buffers
Capital conservation buffer			—			2.5%
SCB			5.4%			N/A
G-SIB capital surcharge			3.0%			3.0%
CCyB1			0%			0%
Capital buffer requirement			8.4%			5.5%

1.The CCyB can be set up to 2.5%, but is currently set by the Federal Reserve at zero.

The capital buffer requirement represents the amount of Common Equity Tier 1 capital the Firm must maintain above the minimum risk-based capital requirements in order to avoid restrictions on the Firm’s ability to make capital distributions, including the payment of dividends and the repurchase of stock, and to pay discretionary bonuses to executive officers. The Firm’s capital buffer requirement computed under the standardized approaches for calculating credit risk and market risk RWA (“Standardized Approach”) is equal to the sum of the SCB, G-SIB capital surcharge and CCyB, and the capital buffer requirement computed under the applicable advanced approaches for calculating credit risk, market risk and operational risk RWA (“Advanced Approach”) is equal to the sum of the 2.5% capital conservation buffer, G-SIB capital surcharge and CCyB.

Risk-Based Regulatory Capital Ratio Requirements

			Regulatory Minimum			At March 31, 2024 and December 31, 2023
						Standardized			Advanced
Required ratios1
CET1 capital ratio			4.5		%	12.9%			10.0%
Tier 1 capital ratio			6.0		%	14.4%			11.5%
Total capital ratio			8.0		%	16.4%			13.5%

1.Required ratios represent the regulatory minimum plus the capital buffer requirement.

The Firm’s Regulatory Capital and Capital Ratios

Risk-based capital

			Standardized
$ in millions			At March 31, 2024			At December 31, 2023
Risk-based capital
CET1 capital			$	70,298		$	69,448
Tier 1 capital			79,046			78,183
Total capital			91,007			88,874
Total RWA			467,763			456,053
Risk-based capital ratio
CET1 capital			15.0		%	15.2		%
Tier 1 capital			16.9		%	17.1		%
Total capital			19.5		%	19.5		%
Required ratio1
CET1 capital			12.9		%	12.9		%
Tier 1 capital			14.4		%	14.4		%
Total capital			16.4		%	16.4		%

1.Required ratios are inclusive of any buffers applicable as of the date presented.

Leveraged-based capital

$ in millions			At March 31, 2024			At December 31, 2023
Leveraged-based capital
Adjusted average assets1			$	1,178,369		$	1,159,626
Supplementary leverage exposure2			1,464,030			1,429,552
Leveraged-based capital ratio
Tier 1 leverage			6.7		%	6.7		%
SLR			5.4		%	5.5		%
Required ratio3
Tier 1 leverage			4.0		%	4.0		%
SLR			5.0		%	5.0		%

1.Adjusted average assets represents the denominator of the Tier 1 leverage ratio and is composed of the average daily balance of consolidated on-balance sheet assets for the quarters ending on the respective balance sheet dates, reduced by disallowed goodwill, intangible assets, investments in covered funds, defined benefit pension plan assets, after-tax gain on sale from assets sold into securitizations, investments in our own capital instruments, certain deferred tax assets and other capital deductions.

2.Supplementary leverage exposure is the sum of Adjusted average assets used in the Tier 1 leverage ratio and other adjustments, primarily: (i) for derivatives, potential future exposure and the effective notional principal amount of sold credit protection offset by qualifying purchased credit protection; (ii) the counterparty credit risk for repo-style transactions; and (iii) the credit equivalent amount for off-balance sheet exposures.

3.Required ratios are inclusive of any buffers applicable as of the date presented.

U.S. Bank Subsidiaries’ Regulatory Capital and Capital Ratios

The OCC establishes capital requirements for the U.S. Bank Subsidiaries, and evaluates their compliance with such capital requirements. Regulatory capital requirements for the U.S. Bank Subsidiaries are calculated in a similar manner to the Firm’s regulatory capital requirements, although G-SIB capital surcharge and SCB requirements do not apply to the U.S. Bank Subsidiaries.

The OCC’s regulatory capital framework includes Prompt Corrective Action (“PCA”) standards, including “well-capitalized” PCA standards that are based on specified regulatory capital ratio minimums. For the Firm to remain an FHC, its U.S. Bank Subsidiaries must remain well-capitalized in accordance with the OCC’s PCA standards. In addition,

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Notes to Consolidated Financial Statements (Unaudited)

failure by the U.S. Bank Subsidiaries to meet minimum capital requirements may result in certain mandatory and discretionary actions by regulators that, if undertaken, could have a direct material effect on the U.S. Bank Subsidiaries’ and the Firm’s financial statements.

At March 31, 2024 and December 31, 2023, MSBNA and MSPBNA risk-based capital ratios are based on the Standardized Approach rules. Beginning on January 1, 2020, MSBNA and MSPBNA elected to defer the effect of the adoption of CECL on risk-based capital amounts and ratios, as well as RWA, adjusted average assets and supplementary leverage exposure calculations, over a five-year transition period. The deferral impacts began to phase in at 25% per year from January 1, 2022 and are phased-in at 75% from January 1, 2024. The deferral impacts will become fully phased-in beginning on January 1, 2025.

MSBNA’s Regulatory Capital

			Well-Capitalized Requirement			Required Ratio1			At March 31, 2024						At December 31, 2023
$ in millions									Amount			Ratio			Amount			Ratio
Risk-based capital
CET1 capital			6.5		%	7.0		%	$	23,127		22.5		%	$	21,925		21.7		%
Tier 1 capital			8.0		%	8.5		%	23,127			22.5		%	21,925			21.7		%
Total capital			10.0		%	10.5		%	24,033			23.3		%	22,833			22.6		%
Leverage-based capital
Tier 1 leverage			5.0		%	4.0		%	$	23,127		10.9		%	$	21,925		10.6		%
SLR			6.0		%	3.0		%	23,127			8.4		%	21,925			8.2		%

MSPBNA’s Regulatory Capital

			Well-Capitalized Requirement			Required Ratio1			At March 31, 2024						At December 31, 2023
$ in millions									Amount			Ratio			Amount			Ratio
Risk-based capital
CET1 capital			6.5		%	7.0		%	$	15,978		26.4		%	$	15,388		25.8		%
Tier 1 capital			8.0		%	8.5		%	15,978			26.4		%	15,388			25.8		%
Total capital			10.0		%	10.5		%	16,266			26.9		%	15,675			26.3		%
Leverage-based capital
Tier 1 leverage			5.0		%	4.0		%	$	15,978		7.7		%	$	15,388		7.5		%
SLR			6.0		%	3.0		%	15,978			7.5		%	15,388			7.2		%

1.Required ratios are inclusive of any buffers applicable as of the date presented. Failure to maintain the buffers would result in restrictions on the ability to make capital distributions, including the payment of dividends.

Additionally, MSBNA is conditionally registered with the SEC as a security-based swap dealer and is registered with the CFTC as a swap dealer. However, as MSBNA is prudentially regulated as a bank, its capital requirements continue to be determined by the OCC.

Other Regulatory Capital Requirements

MS&Co. Regulatory Capital

$ in millions			At March 31, 2024			At December 31, 2023
Net capital			$	18,628		$	18,121
Excess net capital			14,145			13,676

MS&Co. is registered as a broker-dealer and a futures commission merchant with the SEC and the CFTC, respectively, and is registered as a swap dealer with the CFTC.

As an Alternative Net Capital broker-dealer, and in accordance with Securities Exchange Act of 1934 (“Exchange Act”) Rule 15c3-1, Appendix E, MS&Co. is subject to minimum net capital and tentative net capital requirements and operates with capital in excess of its regulatory capital requirements. As a futures commission merchant and registered swap dealer, MS&Co. is subject to CFTC capital requirements. In addition, MS&Co. must notify the SEC if its tentative net capital falls below certain levels. At March 31, 2024 and December 31, 2023, MS&Co. exceeded its net capital requirement and had tentative net capital in excess of the minimum and notification requirements.

Other Regulated Subsidiaries

Certain other subsidiaries are also subject to various regulatory capital requirements. Such subsidiaries include the following, each of which operated with capital in excess of their respective regulatory capital requirements as of March 31, 2024 and December 31, 2023, as applicable:

•MSSB,

•MSIP,

•MSESE,

•MSMS,

•MSCS, and

•MSCG

See Note 16 to the financial statements in the 2023 Form 10-K for further information.

16. Total Equity

Preferred Stock

			Shares Outstanding						Carrying Value
$ in millions, except per share data			At March 31, 2024			Liquidation Preference per Share			At March 31, 2024			At December 31, 2023
Series
A			44,000			$	25,000		$	1,100		$	1,100
C1			519,882			1,000			408			408
E			34,500			25,000			862			862
F			34,000			25,000			850			850
I			40,000			25,000			1,000			1,000
K			40,000			25,000			1,000			1,000
L			20,000			25,000			500			500
M			400,000			1,000			430			430
N			3,000			100,000			300			300
O			52,000			25,000			1,300			1,300
P			40,000			25,000			1,000			1,000
Total									$	8,750		$	8,750
Shares authorized												30,000,000

1.Series C preferred stock is held by MUFG.

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For a description of Series A through Series P preferred stock, see Note 17 to the financial statements in the 2023 Form 10-K. The Firm’s preferred stock has a preference over its common stock upon liquidation. The Firm’s preferred stock qualifies as and is included in Tier 1 capital in accordance with regulatory capital requirements (see Note 15).

Share Repurchases

			Three Months Ended March 31,
$ in millions			2024			2023
Repurchases of common stock under the Firm’s Share Repurchase Authorization			$	1,000		$	1,500

On June 30, 2023, the Firm announced that its Board of Directors reauthorized a multi-year repurchase program of up to $20 billion of outstanding common stock, without a set expiration date, beginning in the third quarter of 2023, which will be exercised from time to time as conditions warrant. For more information on share repurchases, see Note 17 to the financial statements in the 2023 Form 10-K.

Common Shares Outstanding for Basic and Diluted EPS

			Three Months Ended March 31,
in millions			2024			2023
Weighted average common shares outstanding, basic			1,601			1,645
Effect of dilutive RSUs and PSUs			15			18
Weighted average common shares outstanding and common stock equivalents, diluted			1,616			1,663
Weighted average antidilutive common stock equivalents (excluded from the computation of diluted EPS)			—			4

Dividends

$ in millions, except per share data			Three Months Ended March 31, 2024						Three Months Ended March 31, 2023
			Per Share1			Total			Per Share1			Total
Preferred stock series
A			$	392		$	17		$	343		$	15
C			25			13			25			13
E			445			15			445			15
F			434			15			430			14
I			398			16			398			16
K			366			15			366			15
L			305			6			305			6
M2			29			12			29			12
N			2,226			7			2,650			8
O			266			14			266			14
P			406			16			406			16
Total Preferred stock						$	146					$	144
Common stock			$	0.85		$	1,390		$	0.775		$	1,305

1.Common and Preferred Stock dividends are payable quarterly unless otherwise noted.

2.Series M is payable semiannually until September 15, 2026 and thereafter will be payable quarterly.

Accumulated Other Comprehensive Income (Loss)1

$ in millions			CTA			AFS Securities			Pension and Other			DVA			Cash Flow Hedges			Total
December 31, 2023			$	(1,153)		$	(3,094)		$	(595)		$	(1,595)		$	16		$	(6,421)
OCI during the period			(112)			68			4			(568)			(28)			(636)
March 31, 2024			$	(1,265)		$	(3,026)		$	(591)		$	(2,163)		$	(12)		$	(7,057)
December 31, 2022			$	(1,204)		$	(4,192)		$	(508)		$	(345)		$	(4)		$	(6,253)
OCI during the period			32			512			(1)			(8)			7			542
March 31, 2023			$	(1,172)		$	(3,680)		$	(509)		$	(353)		$	3		$	(5,711)

1.Amounts are net of tax and noncontrolling interests.

Components of Period Changes in OCI

			Three Months Ended March 31, 2024
$ in millions			Pre-tax Gain (Loss)			Income Tax Benefit (Provision)			After-tax Gain (Loss)			Non-controlling Interests			Net
CTA
OCI activity			$	(70)		$	(103)		$	(173)		$	(61)		$	(112)
Reclassified to earnings			—			—			—			—			—
Net OCI			$	(70)		$	(103)		$	(173)		$	(61)		$	(112)
Change in net unrealized gains (losses) on AFS securities
OCI activity			$	132		$	(32)		$	100		$	—		$	100
Reclassified to earnings			(43)			11			(32)			—			(32)
Net OCI			$	89		$	(21)		$	68		$	—		$	68
Pension and other
OCI activity			$	—		$	—		$	—		$	—		$	—
Reclassified to earnings			5			(1)			4			—			4
Net OCI			$	5		$	(1)		$	4		$	—		$	4
Change in net DVA
OCI activity			$	(751)		$	180		$	(571)		$	5		$	(576)
Reclassified to earnings			10			(2)			8			—			8
Net OCI			$	(741)		$	178		$	(563)		$	5		$	(568)
Change in fair value of cash flow hedge derivatives
OCI activity			$	(47)		$	11		$	(36)		$	—		$	(36)
Reclassified to earnings			11			(3)			8			—			8
Net OCI			$	(36)		$	8		$	(28)		$	—		$	(28)

			Three Months Ended March 31, 2023
$ in millions			Pre-tax Gain (Loss)			Income Tax Benefit (Provision)			After-tax Gain (Loss)			Non-controlling Interests			Net
CTA
OCI activity			$	(10)		$	30		$	20		$	(12)		$	32
Reclassified to earnings			—			—			—			—			—
Net OCI			$	(10)		$	30		$	20		$	(12)		$	32
Change in net unrealized gains (losses) on AFS securities
OCI activity			$	710		$	(167)		$	543		$	—		$	543
Reclassified to earnings			(41)			10			(31)			—			(31)
Net OCI			$	669		$	(157)		$	512		$	—		$	512
Pension and other
OCI activity			$	—		$	—		$	—		$	—		$	—
Reclassified to earnings			(1)			—			(1)			—			(1)
Net OCI			$	(1)		$	—		$	(1)		$	—		$	(1)
Change in net DVA
OCI activity			$	(30)		$	10		$	(20)		$	(7)		$	(13)
Reclassified to earnings			6			(1)			5			—			5
Net OCI			$	(24)		$	9		$	(15)		$	(7)		$	(8)
Change in fair value of cash flow hedge derivatives
OCI activity			$	7		$	(1)		$	6		$	—		$	6
Reclassified to earnings			1			—			1			—			1
Net OCI			$	8		$	(1)		$	7		$	—		$	7

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17. Interest Income and Interest Expense

						Three Months Ended March 31,
$ in millions									2024			2023
Interest income
Cash and cash equivalents1									$	903		743
Investment securities									1,197			1,018
Loans									3,305			2,815
Securities purchased under agreements to resell2									2,530			1,477
Securities borrowed3									1,376			1,172
Trading assets, net of Trading liabilities									1,382			913
Customer receivables and Other1, 4									2,237			1,842
Total interest income									$	12,930		$	9,980
Interest expense
Deposits									$	2,476		$	1,575
Borrowings									3,223			2,506
Securities sold under agreements to repurchase5									2,402			1,218
Securities loaned6									224			164
Customer payables and Other4, 7									2,809			2,171
Total interest expense									$	11,134		$	7,634
Net interest									$	1,796		$	2,346

1.In the fourth quarter of 2023, interest bearing Cash and cash equivalents and related interest were presented separately for the first time. The prior period amounts for Customer receivables and Other have been disaggregated to exclude Cash and cash equivalents to align with the current presentation.

2.Includes interest paid on Securities purchased under agreements to resell.

3.Includes fees paid on Securities borrowed.

4.Certain prior period amounts have been adjusted to conform with the current period presentation. This adjustment resulted in a decrease to both interest income and interest expense of $890 million and no change to net interest income for the first quarter of 2023 for the Institutional Securities segment. See Note 2 for additional information.

5.Includes interest received on Securities sold under agreements to repurchase.

6.Includes fees received on Securities loaned.

7.Includes fees received from Equity Financing customers related to their short transactions, which can be under either margin or securities lending arrangements.

Interest income and Interest expense are classified in the income statement based on the nature of the instrument and related market conventions. When included as a component of the instrument’s fair value, interest is included within Trading revenues or Investments revenues. Otherwise, it is included within Interest income or Interest expense.

Accrued Interest

$ in millions			At March 31, 2024			At December 31, 2023
Customer and other receivables			$	5,149		$	4,206
Customer and other payables			4,942			4,360

18. Income Taxes

The Firm is routinely under examination by the IRS and other tax authorities in certain countries, such as Japan and the U.K., and in states and localities in which it has significant business operations, such as New York.

The Firm believes that the resolution of these tax examinations will not have a material effect on the annual financial statements, although a resolution could have a material impact in the income statement and on the effective tax rate for any period in which such resolutions occur.

It is reasonably possible that significant changes in the balance of unrecognized tax benefits may occur within the next 12 months. At this time, however, it is not possible to reasonably estimate the expected change to the total amount of unrecognized tax benefits and the impact on the Firm’s effective tax rate over the next 12 months.

19. Segment, Geographic and Revenue Information

Selected Financial Information by Business Segment

			Three Months Ended March 31, 2024
$ in millions			IS			WM			IM			I/E			Total
Investment banking			$	1,447		$	166		$	—		$	(24)		$	1,589
Trading			4,583			262			(7)			14			4,852
Investments			49			19			69			—			137
Commissions and fees1			691			605			—			(69)			1,227
Asset management1,2			157			3,829			1,346			(63)			5,269
Other			124			143			3			(4)			266
Total non-interest revenues			7,051			5,024			1,411			(146)			13,340
Interest income			9,308			3,973			26			(377)			12,930
Interest expense			9,343			2,117			60			(386)			11,134
Net interest			(35)			1,856			(34)			9			1,796
Net revenues			$	7,016		$	6,880		$	1,377		$	(137)		$	15,136
Provision for credit losses			$	2		$	(8)		$	—		$	—		$	(6)
Compensation and benefits			2,343			3,788			565			—			6,696
Non-compensation expenses			2,320			1,294			571			(134)			4,051
Total non-interest expenses			$	4,663		$	5,082		$	1,136		$	(134)		$	10,747
Income before provision for income taxes			$	2,351		$	1,806		$	241		$	(3)		$	4,395
Provision for income taxes			482			403			49			(1)			933
Net income			1,869			1,403			192			(2)			3,462
Net income applicable to noncontrolling interests			50			—			—			—			50
Net income applicable to Morgan Stanley			$	1,819		$	1,403		$	192		$	(2)		$	3,412

			69			March 2024 Form 10-Q

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Table of Contents
Notes to Consolidated Financial Statements (Unaudited)

			Three Months Ended March 31, 2023
$ in millions			IS			WM			IM			I/E			Total
Investment banking			$	1,247		$	104		$	—		$	(21)		$	1,330
Trading			4,257			227			(16)			9			4,477
Investments			28			16			101			—			145
Commissions and fees1			714			590			—			(65)			1,239
Asset management1,2			148			3,382			1,248			(50)			4,728
Other			180			82			(6)			(4)			252
Total non-interest revenues			6,574			4,401			1,327			(131)			12,171
Interest income3			6,868			3,627			29			(544)			9,980
Interest expense3			6,645			1,469			67			(547)			7,634
Net interest			223			2,158			(38)			3			2,346
Net revenues			$	6,797		$	6,559		$	1,289		$	(128)		$	14,517
Provision for credit losses			$	189		$	45		$	—		$	—		$	234
Compensation and benefits			2,365			3,477			568			—			6,410
Non-compensation expenses			2,351			1,325			555			(118)			4,113
Total non-interest expenses			$	4,716		$	4,802		$	1,123		$	(118)		$	10,523
Income before provision for income taxes			$	1,892		$	1,712		$	166		$	(10)		$	3,760
Provision for income taxes			363			336			30			(2)			727
Net income			1,529			1,376			136			(8)			3,033
Net income applicable to noncontrolling interests			51			—			2			—			53
Net income applicable to Morgan Stanley			$	1,478		$	1,376		$	134		$	(8)		$	2,980

1.Substantially all revenues are from contracts with customers.

2.Includes certain fees that may relate to services performed in prior periods.

3.Certain prior period amounts have been adjusted to conform with the current period presentation. This adjustment resulted in a decrease to both interest income and interest expense of $890 million and no change to net interest income for the first quarter of 2023 for the Institutional Securities segment. See Note 2 for additional information.

For a discussion about the Firm’s business segments, see Note 22 to the financial statements in the 2023 Form 10-K.

Detail of Investment Banking Revenues

						Three Months Ended March 31,
$ in millions									2024			2023
Institutional Securities Advisory									$	461		$	638
Institutional Securities Underwriting									986			609
Firm Investment banking revenues from contracts with customers									90		%	89		%

Trading Revenues by Product Type

						Three Months Ended March 31,
$ in millions									2024			2023
Interest rate									$	1,826		$	1,368
Foreign exchange									272			262
Equity1									2,304			2,212
Commodity and other									595			539
Credit									(145)			96
Total									$	4,852		$	4,477

1.Dividend income is included within equity contracts.

The previous table summarizes realized and unrealized gains and losses primarily related to the Firm’s Trading assets and liabilities, from derivative and non-derivative financial instruments, included in Trading revenues in the income

statement. The Firm generally utilizes financial instruments across a variety of product types in connection with its market-making and related risk management strategies. The trading revenues presented in the table are not representative of the manner in which the Firm manages its business activities and are prepared in a manner similar to the presentation of trading revenues for regulatory reporting purposes.

Investment Management Investments Revenues—Net Cumulative Unrealized Carried Interest

$ in millions			At March 31, 2024			At December 31, 2023
Net cumulative unrealized performance-based fees at risk of reversing			$	770		$	787

The Firm’s portion of net cumulative performance-based fees in the form of unrealized carried interest, for which the Firm is not obligated to pay compensation, is at risk of reversing when the return in certain funds fall below specified performance targets. See Note 13 for information regarding general partner guarantees, which include potential obligations to return performance fee distributions previously received.

Investment Management Asset Management Revenues—Reduction of Fees Due to Fee Waivers

						Three Months Ended March 31,
$ in millions									2024			2023
Fee waivers									$	24		$	18

The Firm waives a portion of its fees in the Investment Management business segment from certain registered money market funds that comply with the requirements of Rule 2a-7 of the Investment Company Act of 1940.

Certain Other Fee Waivers

Separately, the Firm’s employees, including its senior officers, may participate on the same terms and conditions as other investors in certain funds that the Firm sponsors primarily for client investment, and the Firm may waive or lower applicable fees and charges for its employees.

Other Expenses—Transaction Taxes

						Three Months Ended March 31,
$ in millions									2024			2023
Transaction taxes									$	206		$	214

Transaction taxes are composed of securities transaction taxes and stamp duties, which are levied on the sale or purchase of securities listed on recognized stock exchanges in certain markets. These taxes are imposed mainly on trades of equity securities in Asia and EMEA. Similar transaction taxes are levied on trades of listed derivative instruments in certain countries.

March 2024 Form 10-Q			70

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Table of Contents
Notes to Consolidated Financial Statements (Unaudited)

Net Revenues by Region

						Three Months Ended March 31,
$ in millions									2024			2023
Americas									$	11,567		$	10,791
EMEA									1,826			1,737
Asia									1,743			1,989
Total									$	15,136		$	14,517

For a discussion about the Firm’s geographic net revenues, see Note 22 to the financial statements in the 2023 Form 10-K.

Revenues Recognized from Prior Services

						Three Months Ended March 31,
$ in millions									2024			2023
Non-interest revenues									$	476		$	704

The previous table includes revenues from contracts with customers recognized where some or all services were performed in prior periods. These revenues primarily include investment banking advisory fees.

Receivables from Contracts with Customers

$ in millions			At March 31, 2024			At December 31, 2023
Customer and other receivables			$	2,570		$	2,339

Receivables from contracts with customers, which are included within Customer and other receivables in the balance sheet, arise when the Firm has both recorded revenues and the right per the contract to bill the customer.

Assets by Business Segment

$ in millions			At March 31, 2024			At December 31, 2023
Institutional Securities			$	832,693		$	810,506
Wealth Management			377,924			365,168
Investment Management			17,886			18,019
Total1			$	1,228,503		$	1,193,693

1. Parent assets have been fully allocated to the business segments.

			71			March 2024 Form 10-Q

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Table of Contents
Financial Data Supplement (Unaudited)

Average Balances and Interest Rates and Net Interest Income

			Three Months Ended March 31,
			2024									2023
$ in millions			Average Daily Balance			Interest			Annualized Average Rate			Average Daily Balance			Interest			Annualized Average Rate
Interest earning assets
Cash and Cash Equivalents1:
U.S.			$	52,696		$	633		4.8		%	$	61,795		$	531		3.5		%
Non-U.S.			43,661			270			2.5		%	53,663			212			1.6		%
Investment securities2			153,866			1,197			3.1		%	159,061			1,018			2.6		%
Loans2			217,921			3,305			6.1		%	214,185			2,815			5.3		%
Securities purchased under agreements to resell3:
U.S.			52,260			1,496			11.5		%	46,847			932			8.1		%
Non-U.S.			49,595			1,034			8.4		%	65,713			545			3.4		%
Securities borrowed4:
U.S.			108,288			1,257			4.7		%	123,206			1,095			3.6		%
Non-U.S.			18,835			119			2.5		%	18,683			77			1.7		%
Trading assets, net of Trading liabilities:
U.S.			107,970			1,175			4.4		%	87,631			786			3.6		%
Non-U.S.			18,329			207			4.5		%	7,264			127			7.1		%
Customer receivables and Other1,10:
U.S.			47,180			1,700			14.5		%	45,260			1,252			11.2		%
Non-U.S.			17,502			537			12.3		%	15,625			590			15.3		%
Total			$	888,103		$	12,930		5.9		%	$	898,933		$	9,980		4.5		%
Interest bearing liabilities
Deposits2			$	346,946		$	2,476		2.9		%	$	346,973		$	1,575		1.8		%
Borrowings2,5			251,956			3,223			5.1		%	245,600			2,506			4.1		%
Securities sold under agreements to repurchase6,8:
U.S.			24,410			1,221			20.1		%	21,075			670			12.9		%
Non-U.S.			58,316			1,181			8.1		%	41,071			548			5.4		%
Securities loaned7,8:
U.S.			5,790			17			1.2		%	4,992			13			1.1		%
Non-U.S.			8,979			207			9.3		%	10,016			151			6.1		%
Customer payables and Other9,10:
U.S.			124,018			1,891			6.1		%	137,766			1,402			4.1		%
Non-U.S.			64,756			918			5.7		%	65,818			769			4.7		%
Total			$	885,171		$	11,134		5.1		%	$	873,311		$	7,634		3.5		%
Net interest income and net interest rate spread						$	1,796		0.8		%				$	2,346		1.0		%

1.In the fourth quarter of 2023, interest bearing Cash and cash equivalents and related interest were presented separately for the first time. The prior period amounts for Customer receivables and Other have been disaggregated to exclude Cash and cash equivalents to align with the current presentation.

2.Amounts include primarily U.S. balances.

3.Includes interest paid on Securities purchased under agreements to resell.

4.Includes fees paid on Securities borrowed.

5.Average daily balance includes borrowings carried at fair value, but for certain borrowings, interest expense is considered part of fair value and is recorded in Trading revenues.

6.Includes interest received on Securities sold under agreements to repurchase.

7.Includes fees received on Securities loaned.

8.The annualized average rate was calculated using (a) interest expense incurred on all securities sold under agreements to repurchase and securities loaned transactions, whether or not such transactions were reported in the balance sheet and (b) net average on-balance sheet balances, which exclude certain securities-for-securities transactions.

9.Includes fees received from Equity Financing customers related to their short transactions, which can be under either margin or securities lending arrangements.

10.Certain prior period amounts have been adjusted to conform with the current period presentation. See Note 2 for additional information.

March 2024 Form 10-Q			72

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Table of Contents
Glossary of Common Terms and Acronyms

2023 Form 10-K			Annual report on Form 10-K for year ended December 31, 2023 filed with the SEC
ABS			Asset-backed securities
ACL			Allowance for credit losses
AFS			Available-for-sale
AML			Anti-money laundering
AOCI			Accumulated other comprehensive income (loss)
AUM			Assets under management or supervision
Balance sheet			Consolidated balance sheet
BHC			Bank holding company
bps			Basis points; one basis point equals 1/100th of 1%
Cash flow statement			Consolidated cash flow statement
CCAR			Comprehensive Capital Analysis and Review
CCyB			Countercyclical capital buffer
CDO			Collateralized debt obligation(s), including Collateralized loan obligation(s)
CDS			Credit default swaps
CECL			Current Expected Credit Losses, as calculated under the Financial Instruments—Credit Losses accounting update
CET1			Common Equity Tier 1
CFTC			U.S. Commodity Futures Trading Commission
CLN			Credit-linked note(s)
CLO			Collateralized loan obligation(s)
CMBS			Commercial mortgage-backed securities
CMO			Collateralized mortgage obligation(s)
CRE			Commercial real estate
CRM			Credit Risk Management Department
CTA			Cumulative foreign currency translation adjustments
DCP			Employee deferred cash-based compensation plans linked to investment performance
DCP investments			Investments associated with certain DCP
DVA			Debt valuation adjustment
EBITDA			Earnings before interest, taxes, depreciation and amortization
EMEA			Europe, Middle East and Africa
EPS			Earnings per common share
FDIC			Federal Deposit Insurance Corporation
FFELP			Federal Family Education Loan Program
FHC			Financial holding company
FICO			Fair Isaac Corporation
Financial statements			Consolidated financial statements
FVO			Fair value option
G-SIB			Global systemically important bank
HFI			Held-for-investment
HFS			Held-for-sale
HQLA			High-quality liquid assets
HTM			Held-to-maturity
I/E			Intersegment eliminations
IHC			Intermediate holding company
IM			Investment Management
Income statement			Consolidated income statement

IRS			Internal Revenue Service
IS			Institutional Securities
LCR			Liquidity coverage ratio, as adopted by the U.S. banking agencies
LIBOR			London Interbank Offered Rate
LTV			Loan-to-value
M&A			Merger, acquisition and restructuring transaction
MSBNA			Morgan Stanley Bank, N.A.
MS&Co.			Morgan Stanley & Co. LLC
MSCG			Morgan Stanley Capital Group Inc.
MSCS			Morgan Stanley Capital Services LLC
MSEHSE			Morgan Stanley Europe Holdings SE
MSESE			Morgan Stanley Europe SE
MSIP			Morgan Stanley & Co. International plc
MSMS			Morgan Stanley MUFG Securities Co., Ltd.
MSPBNA			Morgan Stanley Private Bank, National Association
MSSB			Morgan Stanley Smith Barney LLC
MUFG			Mitsubishi UFJ Financial Group, Inc.
MUMSS			Mitsubishi UFJ Morgan Stanley Securities Co., Ltd.
MWh			Megawatt hour
N/A			Not Applicable
N/M			Not Meaningful
NAV			Net asset value
Non-GAAP			Non-generally accepted accounting principles in the U.S.
NSFR			Net stable funding ratio, as adopted by the U.S. banking agencies
OCC			Office of the Comptroller of the Currency
OCI			Other comprehensive income (loss)
OTC			Over-the-counter
PSU			Performance-based stock unit
ROE			Return on average common equity
ROTCE			Return on average tangible common equity
ROU			Right-of-use
RSU			Restricted stock unit
RWA			Risk-weighted assets
SCB			Stress capital buffer
SEC			U.S. Securities and Exchange Commission
SLR			Supplementary leverage ratio
S&P			Standard & Poor’s
SPE			Special purpose entity
SPOE			Single point of entry
TLAC			Total loss-absorbing capacity
U.K.			United Kingdom
UPB			Unpaid principal balance
U.S.			United States of America
U.S. Bank Subsidiaries			Morgan Stanley Bank N.A. (“MSBNA”) and Morgan Stanley Private Bank, National Association (“MSPBNA”)
U.S. GAAP			Accounting principles generally accepted in the U.S.
VaR			Value-at-Risk
VIE			Variable interest entity
WACC			Implied weighted average cost of capital
WM			Wealth Management

			73			March 2024 Form 10-Q

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Table of Contents

Controls and Procedures

Under the supervision and with the participation of the Firm’s management, including the Chief Executive Officer and Chief Financial Officer, the Firm conducted an evaluation of the effectiveness of the Firm’s disclosure controls and procedures (as defined in Rule 13a-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)). Based on this evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Firm’s disclosure controls and procedures were effective as of the end of the period covered by this report.

No change in the Firm’s internal control over financial reporting (as defined in Rule 13a-15(f) of the Exchange Act) occurred during the period covered by this report that materially affected, or is reasonably likely to materially affect, the Firm’s internal control over financial reporting.

Legal Proceedings

See “Contingencies—Legal” in Note 13 to the Financial

Statements for information about our material legal

proceedings.

Risk Factors

For a discussion of the risk factors affecting the Firm, see “Risk Factors” in Part I, Item 1A of the 2023 Form 10-K.

Unregistered Sales of Equity Securities and Use of Proceeds

Issuer Purchases of Equity Securities

$ in millions, except per share data			Total Number of Shares Purchased1			Average Price Paid per Share			Total Shares Purchased as Part of Share Repurchase Authorization2,3			Dollar Value of Remaining Authorized Repurchase
January			8,995,283			$	86.00		1,878,800			$	17,039
February			6,331,034			$	86.05		5,213,800			$	16,590
March			4,536,567			$	88.02		4,429,444			$	16,200
Three Months Ended March 31, 2024			19,862,884			$	86.48		11,522,044

1.Includes 8,340,840 shares acquired by the Firm in satisfaction of the tax withholding obligations on stock-based awards granted under the Firm’s stock-based compensation plans during the three months ended March 31, 2024.

2.Share purchases under publicly announced authorizations are made pursuant to open-market purchases, Rule 10b5-1 plans or privately negotiated transactions (including with employee benefit plans) as market conditions warrant and at prices the Firm deems appropriate and may be suspended at any time.

3.The Firm’s Board of Directors has approved the repurchase of the Firm’s outstanding common stock under a share repurchase authorization (the “Share Repurchase Authorization”) from time to time as conditions warrant and subject to limitations on distributions from the Federal Reserve. The Share Repurchase Authorization is for capital management purposes and considers, among other things, business segment capital needs, as well as equity-based compensation and benefit plan requirements. The Share Repurchase Authorization has no set expiration or termination date.

On June 30, 2023, the Firm announced that its Board of Directors reauthorized a multi-year repurchase authorization of up to $20 billion of outstanding common stock, without a set expiration date, beginning in the third quarter of 2023, which will be exercised from time to time as conditions

warrant. For further information, see “Liquidity and Capital Resources—Regulatory Requirements—Capital Plans, Stress Tests and the Stress Capital Buffer.”

Other Information

None.

Exhibits

Exhibit No.			Description
15			Letter of awareness from Deloitte & Touche LLP, dated May 3, 2024, concerning unaudited interim financial information.
31.1			Rule 13a-14(a) Certification of Chief Executive Officer.
31.2			Rule 13a-14(a) Certification of Chief Financial Officer.
32.1			Section 1350 Certification of Chief Executive Officer.
32.2			Section 1350 Certification of Chief Financial Officer.
101			Interactive Data Files pursuant to Rule 405 of Regulation S-T formatted in Inline eXtensible Business Reporting Language (“Inline XBRL”).
104			Cover Page Interactive Data File (formatted in Inline XBRL and contained in Exhibit 101).

Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

MORGAN STANLEY (Registrant)
By:			/s/ SHARON YESHAYA
			Sharon Yeshaya Executive Vice President and Chief Financial Officer
By:			/s/ RAJA J. AKRAM
			Raja J. Akram Deputy Chief Financial Officer, Chief Accounting Officer and Controller

Date: May 3, 2024

March 2024 Form 10-Q			74