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 September 30, 2022

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 October 31, 2022, there were 1,690,109,419 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 September 30, 2022

Table of Contents						Part			Item			Page
Financial Information						I
Management’s Discussion and Analysis of Financial Condition and Results of Operations						I			2			1
Introduction												1
Executive Summary												2
Business Segments												8
Institutional Securities												9
Wealth Management												12
Investment Management												15
Supplemental Financial Information												17
Accounting Development Updates												17
Critical Accounting Policies												17
Liquidity and Capital Resources												18
Balance Sheet												18
Regulatory Requirements												21
Quantitative and Qualitative Disclosures about Risk						I			3			27
Market Risk												27
Credit Risk												29
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 September 30, 2022)												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—Equity Method Investments									57
11.			Deposits									57
12.			Borrowings and Other Secured Financings									58
13.			Commitments, Guarantees and Contingencies									58
14.			Variable Interest Entities and Securitization Activities									60
15.			Regulatory Requirements									62
16.			Total Equity									64
17.			Interest Income and Interest Expense									67
18.			Income Taxes									67
19.			Segment, Geographic and Revenue Information									67
Financial Data Supplement (Unaudited)												70
Glossary of Common Terms and Acronyms												71
Controls and Procedures						I			4			72
Other Information						II
Legal Proceedings						II			1			72
Risk Factors						II			1A			72
Unregistered Sales of Equity Securities and Use of Proceeds						II			2			72
Other Information						II			5			72
Exhibits						II			6			73
Signatures												73

			i

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Table of Contents

Available Information

We file annual, quarterly and current reports, proxy statements and other information with the 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;

•Sustainability Report;

•Climate Report; and

•Diversity and Inclusion Report.

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.

			ii

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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. Disclosures reflect the effects of the acquisition of Eaton Vance Corp. (“Eaton Vance”) prospectively from the March 1, 2021 acquisition date. 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 and other securities, 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 and investment advisory services; self-directed brokerage services; financial and wealth planning services; workplace services, including stock plan administration; annuity and insurance products; 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 2021 Form 10-K.

September 2022 Form 10-Q			1

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Table of Contents
Management’s Discussion and Analysis

Executive Summary

Overview of Financial Results

Consolidated Results—Three Months Ended September 30, 2022

•The Firm reported net revenues of $13.0 billion, against a volatile market backdrop.

•The Firm delivered ROTCE of 14.6%, or 15.2% excluding the impact of integration-related expenses (see “Selected Non-GAAP Financial Information” herein).

•The Firm’s expense efficiency ratio of 74% in the current quarter, or 73% excluding the impact of integration-related expenses (see “Selected Non-GAAP Financial Information” herein), contributed to an expense efficiency ratio in the current year period of 72%, or 71% excluding the impact of integration-related expenses (see “Selected Non-GAAP Financial Information” herein).

•At September 30, 2022 our Standardized Common Equity Tier 1 capital ratio was 14.8%.

•Institutional Securities net revenues of $5.8 billion reflect strong performance in Fixed Income and solid results in Equity, while the uncertain macroeconomic environment continued to drive limited activity in Investment Banking.

•Wealth Management delivered a pre-tax margin of 26.9%, or 28.4% excluding integration-related expenses (see “Selected Non-GAAP Financial Information” herein). Results reflect higher net interest income driven by higher interest rates. The business added $65 billion in net new assets, bringing total net new assets year-to-date to $260 billion.

•Investment Management delivered net revenues of $1.2 billion on AUM of $1.3 trillion in a challenging market environment.

Net Revenues

($ in millions)

Net Income Applicable to Morgan Stanley

($ in millions)

Earnings per Diluted Common Share1

1.Adjusted Diluted EPS was $1.53 for the current quarter and $2.04 for the prior year quarter. Adjusted Diluted EPS was $5.04 for the current year period and $6.15 for the prior year period (see “Selected Non-GAAP Financial Information” herein for further information).

We reported net revenues of $13.0 billion in the quarter ended September 30, 2022 (“current quarter,” or “3Q 2022”) compared with $14.8 billion in the quarter ended September 30, 2021 (“prior year quarter,” or “3Q 2021”). For the current quarter, net income applicable to Morgan Stanley was $2.6 billion, or $1.47 per diluted common share, compared with $3.7 billion or $1.98 per diluted common share in the prior year quarter.

We reported net revenues of $40.9 billion in the nine months ended September 30, 2022 (“current year period,” or “YTD 2022”), compared with $45.2 billion in the period ended September 30, 2021 (“prior year period,” or “YTD 2021”). For the current year period, net income applicable to Morgan Stanley was $8.8 billion, or $4.88 per diluted common share, compared with $11.3 billion or $6.02 per diluted common share in the prior year period.

			2			September 2022 Form 10-Q

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Table of Contents
Management’s Discussion and Analysis

Non-interest Expenses1

($ in millions)

1.The percentages on the bars in the chart represent the contribution of compensation and benefits expenses and non-compensation expenses to the total.

•Compensation and benefits expenses of $5,614 million in the current quarter decreased 5% from the prior year quarter, primarily due to lower discretionary incentive compensation and a decrease due to the formulaic payout to Wealth Management representatives driven by lower compensable revenues, partially offset by higher salary expenses driven in part by the impact of higher headcount. Compensation and benefits expenses of $17,438 million in the current year period decreased 9% from the prior year period, primarily due to lower expenses related to certain deferred compensation plans linked to investment performance and lower stock-based compensation expense driven by the Firm’s share price, and lower discretionary incentive compensation, partially offset by higher salary expenses driven in part by the impact of higher headcount.

•Non-compensation expenses of $3,949 million in the current quarter were relatively unchanged from the prior year quarter. Non-compensation expenses of $11,993 million in the current year period increased 6% from the prior year period, primarily due to higher legal expenses, including $200 million related to a regulatory matter in the second quarter of 2022 and increased spend on technology.

Provision for Credit Losses

The Provision for credit losses on loans and lending commitments of $35 million in the current quarter was primarily driven by deterioration in macroeconomic outlook. The Provision for credit losses on loans and lending commitments in the prior year quarter was $24 million, primarily driven by growth in corporate lending commitments.

The Provision for credit losses on loans and lending commitments of $193 million in the current year period was due to portfolio growth and deterioration in macroeconomic outlook. The Provision for credit losses on loans and lending commitments in the prior year period was flat, primarily as a result of paydowns on corporate loans, including by lower-rated borrowers, offset by the provision for one secured lending facility in the second quarter of 2021.

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

Income Taxes

The effective tax rate of 21.4% for the current quarter and 21.1% for the current year period was lower than the prior respective periods, primarily driven by the realization of certain tax benefits.

September 2022 Form 10-Q			3

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Table of Contents
Management’s Discussion and Analysis

Business Segment Results

Net Revenues by Segment1

($ in millions)

Net Income Applicable to Morgan Stanley by Segment1

($ in millions)

1.The percentages on the bars in the charts represent the contribution of each business segment to the total of the applicable financial category and may not sum to 100% due to intersegment eliminations. See Note 19 to the financial statements for details of intersegment eliminations.

•Institutional Securities net revenues of $5,817 million in the current quarter decreased 22% from the prior year quarter, primarily reflecting lower results from Investment banking and Equity, partially offset by higher Fixed income results. Net revenues of $19,593 million in the current year period decreased 15% from the prior year period, primarily reflecting lower underwriting results, partially offset by higher results in Fixed income.

•Wealth Management net revenues of $6,120 million in the current quarter increased 3% from the prior year quarter, primarily reflecting higher Net interest revenues, partially offset by lower Asset management revenues and Transactional revenues. Net revenues of $17,791 million in the current year period were relatively unchanged from the prior year period, as lower Transactional revenues, primarily driven by losses on investments associated with certain employee deferred compensation plans, were offset by higher Net interest revenues and Asset management revenues.

			4			September 2022 Form 10-Q

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Table of Contents
Management’s Discussion and Analysis

•Investment Management net revenues of $1,168 million in the current quarter decreased 20% from the prior year quarter, reflecting lower Asset management and related fees and lower Performance-based income and other revenues. Net revenues of $3,914 million in the current year period decreased 12% from the prior year period, primarily reflecting lower Performance-based income and other revenues.

Net Revenues by Region1, 2

($ in millions)

1.The percentages on the bars in the charts represent the contribution of each region to the total.

2.For a discussion of how the geographic breakdown of net revenues is determined, see Note 23 to the financial statements in the 2021 Form 10-K.

Americas net revenues in the current quarter decreased 10% from the prior year quarter, primarily driven by Investment banking results within the Institutional Securities business segment. EMEA net revenues decreased 21% from the prior year quarter, primarily driven by Investment banking results within the Institutional Securities business segment. Asia net revenues decreased 14% from the prior year quarter, primarily driven by Equity results within the Institutional Securities business segment.

Americas net revenues in the current year period decreased 9% from the prior year period, primarily driven by results within the Institutional Securities business segment, with lower Investment banking and Other net revenues, partially

offset by higher results from Fixed Income. EMEA net revenues decreased 10% from the prior year quarter, primarily driven by Investment banking results within the Institutional Securities business segment. Asia net revenues decreased 10% from the prior year quarter, primarily driven by results within the Institutional Securities business segment, with lower results in Investment banking and Equity, partially offset by higher results from Fixed Income.

September 2022 Form 10-Q			5

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Table of Contents
Management’s Discussion and Analysis

Selected Financial Information and Other Statistical Data

			Three Months Ended September 30,						Nine Months Ended September 30,
$ in millions			2022			2021			2022			2021
Consolidated results
Net revenues			$	12,986		$	14,753		$	40,919		$	45,231
Earnings applicable to Morgan Stanley common shareholders			$	2,494		$	3,584		$	8,427		$	10,974
Earnings per diluted common share			$	1.47		$	1.98		$	4.88		$	6.02
Consolidated financial measures
Expense efficiency ratio1			74		%	67		%	72		%	67		%
Adjusted expense efficiency ratio1, 2			73		%	66		%	71		%	67		%
ROE3			10.7		%	14.5		%	11.9		%	15.1		%
Adjusted ROE2, 3			11.1		%	15.0		%	12.2		%	15.4		%
ROTCE2, 3			14.6		%	19.6		%	16.1		%	19.7		%
Adjusted ROTCE2, 3			15.2		%	20.2		%	16.6		%	20.2		%
Pre-tax margin4			26		%	33		%	28		%	33		%
Effective tax rate			21.4		%	23.6		%	21.1		%	22.9		%
Average liquidity resources5			$	308,001		$	358,310		N/M			N/M
Pre-tax margin by segment4
Institutional Securities			28		%	40		%	30		%	38		%
Wealth Management			27		%	26		%	27		%	26		%
Wealth Management, adjusted2			28		%	28		%	28		%	28		%
Investment Management			10		%	25		%	15		%	26		%
Investment Management, adjusted2			13		%	28		%	17		%	28		%

in millions, except per share and employee data			At September 30, 2022			At December 31, 2021
Loans6			$	218,448		$	200,761
Total assets			$	1,160,029		$	1,188,140
Deposits			$	338,123		$	347,574
Borrowings			$	220,423		$	233,127
Common shareholders' equity			$	92,261		$	97,691
Tangible common shareholders’ equity2			$	67,648		$	72,499
Common shares outstanding			1,694			1,772
Book value per common share7			$	54.46		$	55.12
Tangible book value per common share2, 7			$	39.93		$	40.91
Worldwide employees (in thousands)			82			75
Client assets8 (in billions)			$	5,413		$	6,554
Capital Ratios9
Common Equity Tier 1 capital—Standardized			14.8		%	16.0		%
Tier 1 capital—Standardized			16.7		%	17.7		%
Common Equity Tier 1 capital—Advanced			15.2		%	17.4		%
Tier 1 capital—Advanced			17.1		%	19.1		%
Tier 1 leverage			6.6		%	7.1		%
SLR			5.4		%	5.6		%

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

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

3.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.

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 shareholders’ equity and tangible common shareholders’ 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. The prior period has been revised to conform to the current period presentation. See “Business Segments—Wealth Management” herein for additional information.

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

Russia and Ukraine War

We continue to monitor the war in Ukraine and its impact on both the Ukrainian and Russian economies, as well as related impacts on other world economies and the financial markets. Our direct exposure to both Russia and Ukraine remains limited. We are not entering any new business onshore in Russia and our activities in Russia are limited to helping global clients address and close out pre-existing obligations.

Refer to “Risk Factors” and “Forward-Looking Statements” in the 2021 Form 10-K for more information on the potential effects of geopolitical events and acts of war or aggression.

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 statement and otherwise. 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.

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

			6			September 2022 Form 10-Q

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Table of Contents
Management’s Discussion and Analysis

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

			Three Months Ended September 30,						Nine Months Ended September 30,
$ in millions, except per share data			2022			2021			2022			2021
Earnings applicable to Morgan Stanley common shareholders			$	2,494		$	3,584		$	8,427		$	10,974
Impact of adjustments:
Wealth Management—Compensation expenses			3			9			8			48
Wealth Management—Non-compensation expenses			89			104			255			189
Investment Management—Compensation expenses			7			10			23			29
Investment Management—Non-compensation expenses			24			22			64			44
Integration-related expenses			123			145			350			310
Related tax benefit			(29)			(34)			(82)			(72)
Adjusted earnings applicable to Morgan Stanley common shareholders—non-GAAP1			$	2,588		$	3,695		$	8,695		$	11,212
Earnings per diluted common share			$	1.47		$	1.98		$	4.88		$	6.02
Impact of adjustments			0.06			0.06			0.16			0.13
Adjusted earnings per diluted common share—non-GAAP1			$	1.53		$	2.04		$	5.04		$	6.15
Expense efficiency ratio			74		%	67		%	72		%	67		%
Impact of adjustments			(1)		%	(1)		%	(1)		%	—		%
Adjusted expense efficiency ratio—non-GAAP1			73		%	66		%	71		%	67		%
Wealth Management Pre-tax margin			27		%	26		%	27		%	26		%
Impact of adjustments			1		%	2		%	1		%	2		%
Adjusted Wealth Management pre-tax margin—non-GAAP1			28		%	28		%	28		%	28		%
Investment Management Pre-tax margin			10		%	25		%	15		%	26		%
Impact of adjustments			3		%	3		%	2		%	2		%
Adjusted Investment Management pre-tax margin—non-GAAP1			13		%	28		%	17		%	28		%

$ in millions			At September 30, 2022			At December 31, 2021
Tangible equity
Common shareholders' equity			$	92,261		$	97,691
Less: Goodwill and net intangible assets			(24,613)			(25,192)
Tangible common shareholders' equity—non-GAAP			$	67,648		$	72,499

			Average Monthly Balance
			Three Months Ended September 30,						Nine Months Ended September 30,
$ in millions			2022			2021			2022			2021
Tangible equity
Common shareholders' equity			$	92,905		$	98,563		$	94,654		$	96,929
Less: Goodwill and net intangible assets			(24,715)			(25,433)			(24,921)			(22,836)
Tangible common shareholders' equity—non-GAAP			$	68,190		$	73,130		$	69,733		$	74,093

			Three Months Ended September 30,						Nine Months Ended September 30,
$ in billions			2022			2021			2022			2021
Average common equity
Unadjusted—GAAP			$	92.9		$	98.6		$	94.7		$	96.9
Adjusted1—Non-GAAP			92.9			98.6			94.8			97.0
ROE2
Unadjusted—GAAP			10.7		%	14.5		%	11.9		%	15.1		%
Adjusted1—Non-GAAP			11.1		%	15.0		%	12.2		%	15.4		%
Average tangible common equity—Non-GAAP
Unadjusted			$	68.2		$	73.1		$	69.7		$	74.1
Adjusted1			68.2			73.2			69.9			74.2
ROTCE2—Non-GAAP
Unadjusted			14.6		%	19.6		%	16.1		%	19.7		%
Adjusted1			15.2		%	20.2		%	16.6		%	20.2		%

Non-GAAP Financial Measures by Business Segment

			Three Months Ended September 30,						Nine Months Ended September 30,
$ in billions			2022			2021			2022			2021
Average common equity3
Institutional Securities			$	48.8		$	43.5		$	48.8		$	43.5
Wealth Management			31.0			28.6			31.0			28.6
Investment Management			10.6			10.7			10.6			8.2
ROE4
Institutional Securities			10		%	20		%	12		%	20		%
Wealth Management			16		%	16		%	16		%	17		%
Investment Management			4		%	12		%	6		%	15		%
Average tangible common equity3
Institutional Securities			$	48.3		$	42.9		$	48.3		$	42.9
Wealth Management			16.3			13.4			16.3			13.4
Investment Management			0.8			1.0			0.8			1.0
ROTCE4
Institutional Securities			10		%	20		%	12		%	20		%
Wealth Management			30		%	34		%	30		%	35		%
Investment Management			56		%	161		%	87		%	128		%

1.Adjusted amounts exclude the effect of costs related to the integrations of E*TRADE and Eaton Vance, net of tax as appropriate.

2.ROE and ROTCE represent earnings applicable to Morgan Stanley common shareholders as a percentage of average common equity and average tangible common equity, respectively. When excluding integration-related costs, both the numerator and average denominator are adjusted.

3.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 equity.

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

Return on Tangible Common Equity Goal

In January 2022, we established an ROTCE goal of over 20%, excluding integration-related expenses. Our ROTCE goal is a forward-looking statement that was based on a normal market environment and may be materially affected by many factors. See “Risk Factors” and “Forward-Looking Statements” in the 2021 Form 10-K for further information on market and economic conditions and their potential effects on our future operating results.

For further information on non-GAAP measures (ROTCE excluding integration-related expenses), see “Selected Non-GAAP Financial Information” herein.

September 2022 Form 10-Q			7

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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.

The global economic and geopolitical environment continues to be characterized by persistent inflation, rising interest rates and volatility in global financial markets. This environment has impacted our businesses, as discussed further herein.

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 2021 Form 10-K.

			8			September 2022 Form 10-Q

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Table of Contents
Management’s Discussion and Analysis

Institutional Securities

Income Statement Information

			Three Months Ended September 30,
$ in millions			2022			2021			% Change
Revenues
Advisory			$	693		$	1,272		(46)		%
Equity			218			1,010			(78)		%
Fixed income			366			567			(35)		%
Total Underwriting			584			1,577			(63)		%
Total Investment banking			1,277			2,849			(55)		%
Equity			2,459			2,876			(14)		%
Fixed income			2,181			1,640			33		%
Other			(100)			130			(177)		%
Net revenues			$	5,817		$	7,495		(22)		%
Provision for credit losses			24			24			—%
Compensation and benefits			1,948			2,248			(13)		%
Non-compensation expenses			2,219			2,250			(1)		%
Total non-interest expenses			4,167			4,498			(7)		%
Income before provision for income taxes			1,626			2,973			(45)		%
Provision for income taxes			305			713			(57)		%
Net income			1,321			2,260			(42)		%
Net income applicable to noncontrolling interests			47			31			52		%
Net income applicable to Morgan Stanley			$	1,274		$	2,229		(43)		%

			Nine Months Ended September 30,
$ in millions			2022			2021			% Change
Revenues
Advisory			$	2,235		$	2,416		(7)		%
Equity			624			3,584			(83)		%
Fixed income			1,124			1,838			(39)		%
Total Underwriting			1,748			5,422			(68)		%
Total Investment banking			3,983			7,838			(49)		%
Equity			8,593			8,578			—%
Fixed income			7,604			6,288			21		%
Other			(587)			460			N/M
Net revenues			$	19,593		$	23,164		(15)		%
Provision for credit losses			150			1			N/M
Compensation and benefits			6,602			7,795			(15)		%
Non-compensation expenses			6,874			6,526			5		%
Total non-interest expenses			13,476			14,321			(6)		%
Income before provision for income taxes			5,967			8,842			(33)		%
Provision for income taxes			1,235			2,023			(39)		%
Net income			4,732			6,819			(31)		%
Net income applicable to noncontrolling interests			146			85			72		%
Net income applicable to Morgan Stanley			$	4,586		$	6,734		(32)		%

Investment Banking

Investment Banking Volumes

			Three Months Ended September 30,						Nine Months Ended September 30,
$ in billions			2022			2021			2022			2021
Completed mergers and acquisitions1			$	138		$	365		$	629		$	744
Equity and equity-related offerings2, 3			5			23			16			93
Fixed income offerings2, 4			51			85			187			298

Source: Refinitiv data as of October 1, 2022. 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 $1,277 million in the current quarter decreased 55% compared with the prior year quarter, primarily reflecting a decrease in underwriting revenues in line with market levels and lower advisory revenues.

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

•Equity underwriting revenues decreased on lower volumes, with lower revenues across all products.

•Fixed income underwriting revenues decreased primarily due to lower issuances.

Revenues of $3,983 million in the current year period decreased 49% compared with the prior year period, primarily reflecting a decrease in underwriting revenues in line with market levels.

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

•Equity underwriting revenues decreased on lower volumes, with lower revenues across all products.

•Fixed income underwriting revenues decreased primarily due to lower issuances.

In the near term, lower levels of announced M&A transactions are expected to impact Advisory revenues.

See “Investment Banking Volumes” herein.

September 2022 Form 10-Q			9

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Table of Contents
Management’s Discussion and Analysis

Equity, Fixed Income and Other Net Revenues

Equity and Fixed Income Net Revenues

			Three Months Ended September 30, 2022
									Net Interest2			All Other3
$ in millions			Trading			Fees1									Total
Financing			$	1,308		$	132		$	(74)		$	2		$	1,368
Execution services			578			573			21			(81)			1,091
Total Equity			$	1,886		$	705		$	(53)		$	(79)		$	2,459
Total Fixed Income			$	1,928		$	85		$	133		$	35		$	2,181

			Three Months Ended September 30, 2021
									Net Interest2			All Other3
$ in millions			Trading			Fees1									Total
Financing			$	1,204		$	123		$	130		$	1		$	1,458
Execution services			832			612			(62)			36			1,418
Total Equity			$	2,036		$	735		$	68		$	37		$	2,876
Total Fixed Income			$	1,029		$	75		$	479		$	57		$	1,640

			Nine Months Ended September 30, 2022
									Net Interest2			All Other3
$ in millions			Trading			Fees1									Total
Financing			$	3,914		$	404		$	46		$	7		$	4,371
Execution services			2,371			1,887			(22)			(14)			4,222
Total Equity			$	6,285		$	2,291		$	24		$	(7)		$	8,593
Total Fixed Income			$	6,263		$	264		$	1,046		$	31		$	7,604

			Nine Months Ended September 30, 2021
									Net Interest2			All Other3
$ in millions			Trading			Fees1									Total
Financing			$	2,987		$	374		$	429		$	7		$	3,797
Execution services			2,764			2,048			(169)			138			4,781
Total Equity			$	5,751		$	2,422		$	260		$	145		$	8,578
Total Fixed Income			$	4,490		$	228		$	1,335		$	235		$	6,288

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.

Current Quarter

Equity

Net revenues of $2,459 million in the current quarter decreased 14% compared with elevated levels in the prior year quarter, primarily reflecting a decrease in execution services.

•Financing revenues decreased primarily due to lower average client balances and lower client activity.

•Execution services revenues decreased primarily due to a mark-to-market loss on a business-related investment and lower client activity in derivatives and cash equities.

Fixed Income

Net revenues of $2,181 million in the current quarter increased 33% compared with the prior year quarter, primarily reflecting an increase in global macro products.

•Global macro products benefited from client engagement and increased client flow activity in an environment characterized by inflationary pressures, central bank actions and fiscal activity driving higher volatility. Revenues increased primarily due to the impact of market conditions

on inventory held to facilitate client activity and increased client activity.

•Credit products revenues were relatively unchanged from the prior year quarter as an increase due to the impact of market conditions on inventory held to facilitate client activity in corporate credit products was offset by a decrease in client activity in corporate credit products.

•Commodities products and other fixed income revenues decreased primarily due to lower client activity in Commodities.

Other Net Revenues

Other Net revenues in the current quarter decreased compared with the prior year quarter, primarily due to higher mark-to-market losses on corporate loans held for sale, net of hedges compared with gains in the prior year quarter.

Current Year Period

Equity

Net revenues of $8,593 million in the current year period were relatively unchanged compared with the prior year period as an increase in financing was offset by a decrease in execution services.

•Absent the loss from a credit event for a single client in the prior year period, Financing revenues decreased as the impact of marginally lower average client balances was partially offset by the impact of a change in client balance mix.

•Execution services revenues decreased primarily due to lower client activity and the impact of market conditions on inventory held to facilitate client activity in cash equities, as well as a mark-to-market loss on a business-related investment, partially offset by the absence of trading losses related to the aforementioned credit event.

Fixed Income

Net revenues of $7,604 million in the current year period increased 21% compared with the prior year period, primarily reflecting an increase in global macro and commodities products, partially offset by a decrease in credit products.

•Global macro products benefited from client engagement and increased client flow activity in an environment characterized by inflationary pressures, central bank actions and fiscal activity driving higher volatility. Revenues increased primarily due to the impact of market conditions on inventory held to facilitate client activity and increased client activity.

•Credit products revenues decreased primarily due to the impact of market conditions on inventory held to facilitate client activity across products.

•Commodities products and other fixed income revenues increased primarily due to higher client activity and the impact of market conditions on inventory held to facilitate client activity in Commodities.

			10			September 2022 Form 10-Q

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Table of Contents
Management’s Discussion and Analysis

Other Net Revenues

Other Net revenues in the current year period decreased compared with the prior year period, primarily due to higher mark-to-market losses on corporate loans held for sale, net of hedges, as well as losses compared with gains in the prior year period on investments associated with certain employee deferred compensation plans and lower results from our Japanese joint venture, MUMSS.

Provision for Credit Losses

Provision for credit losses on loans and lending commitments of $24 million in the current quarter was primarily driven by deterioration in macroeconomic outlook. The Provision for credit losses on loans and lending commitments was $24 million in the prior year quarter, primarily driven by growth in corporate lending commitments.

Provision for credit losses on loans and lending commitments of $150 million in the current year period was driven by portfolio growth and deterioration in macroeconomic outlook. In the prior year period, the Provision for credit losses on loans and lending commitments was flat, primarily as a result of provision for one secured lending facility in the second quarter of 2021, offset by the impact of paydowns on corporate loans, including by lower-rated borrowers.

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

Non-interest Expenses

Non-interest expenses of $4,167 million in the current quarter decreased 7% compared with the prior year quarter, primarily due to lower Compensation and benefits expenses.

•Compensation and benefits expenses decreased in the current quarter, primarily due to lower discretionary incentive compensation on lower revenues.

•Non-compensation expenses were relatively unchanged in the current quarter.

Non-interest expenses of $13,476 million in the current year period decreased 6% compared with the prior year period, primarily due to lower Compensation and benefits expenses, partially offset by higher Non-compensation expenses.

•Compensation and benefits expenses decreased in the current year period, primarily due to lower discretionary incentive compensation on lower revenues, lower stock-based compensation expense driven by the Firm’s share price, and lower expenses related to certain deferred compensation plans linked to investment performance, partially offset by higher salary expenses driven in part by the impact of higher headcount.

•Non-compensation expenses increased in the current year period, primarily due to an increase in legal expenses, including $200 million related to a regulatory matter in the second quarter of 2022 and increased spend on technology.

Income Taxes

The effective tax rate of 18.8% for the current quarter and 20.7% for the current year period was lower than the prior respective periods, primarily driven by the realization of certain tax benefits.

September 2022 Form 10-Q			11

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Table of Contents
Management’s Discussion and Analysis

Wealth Management

Income Statement Information

			Three Months Ended September 30,
$ in millions			2022			2021			% Change
Revenues
Asset management			$	3,389		$	3,628		(7)		%
Transactional1			616			832			(26)		%
Net interest			2,004			1,348			49		%
Other1			111			127			(13)		%
Net revenues			6,120			5,935			3		%
Provision for credit losses			11			—			N/M
Compensation and benefits			3,171			3,159			—		%
Non-compensation expenses			1,289			1,246			3		%
Total non-interest expenses			4,460			4,405			1		%
Income before provision for income taxes			$	1,649		$	1,530		8		%
Provision for income taxes			396			373			6		%
Net income applicable to Morgan Stanley			$	1,253		$	1,157		8		%

			Nine Months Ended September 30,
$ in millions			2022			2021			% Change
Revenues
Asset management			$	10,525		$	10,266		3		%
Transactional1			1,542			3,232			(52)		%
Net interest			5,291			3,988			33		%
Other1			433			503			(14)		%
Net revenues			17,791			17,989			(1)		%
Provision for credit losses			43			(2)			N/M
Compensation and benefits			9,191			9,604			(4)		%
Non-compensation expenses			3,814			3,621			5		%
Total non-interest expenses			13,005			13,225			(2)		%
Income before provision for income taxes			$	4,743		$	4,766		—		%
Provision for income taxes			1,028			1,103			(7)		%
Net income applicable to Morgan Stanley			$	3,715		$	3,663		1		%

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

Wealth Management Metrics

$ in billions			At September 30, 2022			At December 31, 2021
Total client assets1			$	4,134		$	4,989
U.S. Bank Subsidiary loans			$	146		$	129
Margin and other lending2			$	24		$	31
Deposits3			$	332		$	346
Annualized weighted average cost of deposits			0.93%			0.10%

			Three Months Ended September 30,						Nine Months Ended September 30,
			2022			2021			2022			2021
Net new assets4			$	64.8		$	134.5		$	259.7		$	310.6

1.The prior period amount has been revised. See “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 are sourced from Wealth Management clients and other sources of funding on the U.S. Bank Subsidiaries. Deposits include sweep deposit programs, savings and other, and time deposits. Excludes approximately $8 billion and $9 billion of off-balance sheet deposits as of September 30, 2022 and December 31, 2021, respectively.

4.Net new assets represent client inflows, including dividends and interest, and asset acquisitions, less client outflows, and exclude activity from business combinations/divestitures and the impact of fees and commissions.

Advisor-led Channel

$ in billions			At September 30, 2022			At December 31, 2021
Advisor-led client assets1			$	3,305		$	3,886
Fee-based client assets2			$	1,628		$	1,839
Fee-based client assets as a percentage of advisor-led client assets			49%			47%

			Three Months Ended September 30,						Nine Months Ended September 30,
			2022			2021			2022			2021
Fee-based asset flows3			$	16.7		$	70.6		$	142.4		$	141.5

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 2021 Form 10-K.

Self-directed Channel

$ in billions			At September 30, 2022			At December 31, 2021
Self-directed assets1			$	829		$	1,103
Self-directed households (in millions)2			7.8			7.4

			Three Months Ended September 30,						Nine Months Ended September 30,
			2022			2021			2022			2021
Daily average revenue trades (“DARTs”) (in thousands)3			805			959			900			1,200

1.Self-directed assets represent active accounts which are not advisor led. Active accounts are defined as having at least $25 in assets. The prior period amount has been revised to include certain additional vested client employee stock options to align the timing of recognition with other existing Morgan Stanley client assets.

2.Self-directed households represent the total number of households that include at least one 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.

			12			September 2022 Form 10-Q

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Table of Contents
Management’s Discussion and Analysis

Workplace Channel1

$ in billions			At September 30, 2022			At December 31, 2021
Stock plan unvested assets2			$	312		$	509
Stock plan participants (in millions)3			6.2			5.6

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 $3,389 million in the current quarter decreased 7% compared with the prior year quarter, primarily due to lower fee-based asset levels in the current quarter as a result of lower market levels, partially offset by positive fee-based flows.

In the current year period, asset management increased 3% to $10,525 million compared with the prior year period, primarily due to higher fee-based asset levels in the current year period as a result of positive fee-based flows, partially offset by lower market levels.

See “Fee-Based Client Assets—Rollforwards” herein.

Transactional Revenues

Transactional revenues of $616 million in the current quarter decreased 26% compared with the prior year quarter, primarily due to lower client activity.

In the current year period, transactional revenues decreased 52% to $1,542 million compared with the prior year period, primarily due to losses on investments associated with certain employee deferred compensation plans and lower client activity in equities.

Net Interest

Net interest revenues of $2,004 million in the current quarter and $5,291 million in the current year period increased 49% and 33% compared with the prior year quarter and the prior year period, respectively, primarily due to net effect of higher interest rates and growth in bank lending.

The level and pace of interest rate changes may impact the composition of deposits and customer behavior, which may impact net interest income in future periods.

Non-interest Expenses

Non-interest expenses of $4,460 million in the current quarter increased 1% compared with the prior year quarter, as a result of higher Non-compensation expenses .

•Compensation and benefits expenses were relatively unchanged in the current quarter as the impact of higher

headcount was offset by a decrease in the formulaic payout to Wealth Management representatives driven by lower compensable revenues.

•Non-compensation expenses increased in the current quarter primarily driven by spend on technology and higher marketing and business development costs.

In the current year period, Non-interest expenses decreased 2% to $13,005 million compared with the prior year period, primarily as a result of lower Compensation and benefits expenses, partially offset by higher Non-compensation expenses.

•Compensation and benefits expenses decreased in the current year period primarily due to lower expenses related to certain deferred compensation plans linked to investment performance, partially offset by the impact of higher headcount.

•Non-compensation expenses increased in the current year period primarily driven by spend on technology and higher marketing and business development costs.

Fee-Based Client Assets Rollforwards

$ in billions			At June 30, 2022			Inflows			Outflows			Market Impact						At September 30, 2022
Separately managed1			$	556		$	14		$	(6)		$	(53)					$	511
Unified managed			396			18			(12)			(23)						379
Advisor			172			7			(9)			(7)						163
Portfolio manager			546			22			(18)			(24)						526
Subtotal			$	1,670		$	61		$	(45)		$	(107)					$	1,579
Cash management			47			10			(8)			—						49
Total fee-based client assets			$	1,717		$	71		$	(53)		$	(107)					$	1,628

$ in billions			At June 30, 2021			Inflows			Outflows			Market Impact			At September 30, 2021
Separately managed1			$	407		$	51		$	(4)		$	14		$	468
Unified managed			436			27			(18)			(6)			439
Advisor			201			11			(9)			(2)			201
Portfolio manager			590			29			(16)			(7)			596
Subtotal			$	1,634		$	118		$	(47)		$	(1)		$	1,704
Cash management			46			9			(7)			—			48
Total fee-based client assets			$	1,680		$	127		$	(54)		$	(1)		$	1,752

$ in billions			At December 31, 2021			Inflows2			Outflows			Market Impact						At September 30, 2022
Separately managed1			$	479		$	126		$	(19)		$	(75)					$	511
Unified managed			467			58			(37)			(109)						379
Advisor			211			22			(27)			(43)						163
Portfolio manager			636			71			(52)			(129)						526
Subtotal			$	1,793		$	277		$	(135)		$	(356)					$	1,579
Cash management			46			28			(25)			—						49
Total fee-based client assets			$	1,839		$	305		$	(160)		$	(356)					$	1,628

September 2022 Form 10-Q			13

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Table of Contents
Management’s Discussion and Analysis

$ in billions			At December 31, 2020			Inflows			Outflows			Market Impact			At September 30, 2021
Separately managed1			$	359		$	77		$	(15)		$	47		$	468
Unified managed			379			75			(42)			27			439
Advisor			177			30			(23)			17			201
Portfolio manager			509			84			(44)			47			596
Subtotal			$	1,424		$	266		$	(124)		$	138		$	1,704
Cash management			48			22			(22)			—			48
Total fee-based client assets			$	1,472		$	288		$	(146)		$	138		$	1,752

1.Includes non-custody account values reflecting prior quarter-end balances due to lag in the reporting of asset values by third-party custodians.

2.Includes $75 billion of fee-based assets acquired in an asset acquisition in the current year period reflected in Separately managed.

Average Fee Rates1

			Three Months Ended September 30,						Nine Months Ended September 30,
Fee rate in bps			2022			2021			2022			2021
Separately managed			11			14			12			14
Unified managed			94			95			94			96
Advisor			80			82			81			82
Portfolio manager			91			93			92			93
Subtotal			65			71			66			72
Cash management			6			5			6			5
Total fee-based client assets			63			70			65			70

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

For a description of fee-based client assets and rollforward items 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 2021 Form 10-K.

			14			September 2022 Form 10-Q

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Management’s Discussion and Analysis

Investment Management

Income Statement Information

			Three Months Ended September 30,
$ in millions			2022			2021			% Change
Revenues
Asset management and related fees			$	1,269		$	1,470		(14)		%
Performance-based income and other1			(101)			(17)			N/M
Net revenues			1,168			1,453			(20)		%
Compensation and benefits			495			513			(4)		%
Non-compensation expenses			557			570			(2)		%
Total non-interest expenses			1,052			1,083			(3)		%
Income before provision for income taxes			116			370			(69)		%
Provision for income taxes			26			64			(59)		%
Net income			90			306			(71)		%
Net income (loss) applicable to noncontrolling interests			(17)			(14)			(21)		%
Net income applicable to Morgan Stanley			$	107		$	320		(67)		%

			Nine Months Ended September 30,
$ in millions			2022			2021			% Change
Revenues
Asset management and related fees			$	3,961		$	3,991		(1)		%
Performance-based income and other1			(47)			478			(110)		%
Net revenues			3,914			4,469			(12)		%
Compensation and benefits			1,645			1,742			(6)		%
Non-compensation expenses			1,676			1,557			8		%
Total non-interest expenses			3,321			3,299			1		%
Income before provision for income taxes			593			1,170			(49)		%
Provision for income taxes			121			253			(52)		%
Net income			472			917			(49)		%
Net income (loss) applicable to noncontrolling interests			(26)			(19)			(37)		%
Net income applicable to Morgan Stanley			$	498		$	936		(47)		%

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

Acquisition of Eaton Vance

The comparison of the current year period results to the prior year period is impacted by the acquisition of Eaton Vance on March 1, 2021. For additional information on the acquisition of Eaton Vance, see Note 3 to the financial statements in the 2021 Form 10-K.

Net Revenues

Asset Management and Related Fees

Asset management and related fees of $1,269 million in the current quarter decreased 14% from the prior year quarter, primarily due to lower average AUM driven by the decline in equity markets, partially offset by the impact of lower fee waivers in certain money market funds.

Asset management and related fees of $3,961 million in the current year period were relatively unchanged from the prior year period, reflecting the impact of the decline in equity markets, offset by incremental revenues as a result of the Eaton Vance acquisition and the impact of lower fee waivers in certain money market funds.

Asset management revenues are influenced by the level and relative mix of AUM. The current market environment may impact AUM and net flows within asset classes and therefore our asset management revenues.

See “Assets under Management or Supervision” herein.

Performance-based Income and Other

Performance-based income and other revenues were a loss of $101 million in the current quarter, representing a decrease from the prior year quarter, primarily due to the reversal of accrued carried interest in certain private equity and real estate funds.

Performance-based income and other revenues were a loss of $47 million in the current year period, representing a 110% decrease from the prior year period, primarily due to lower accrued carried interest in certain private equity funds, losses on investments associated with certain employee deferred compensation plans compared with gains in the prior year period, and mark-to-market losses on public investments.

Non-interest Expenses

Non-interest expenses of $1,052 million in the current quarter decreased 3% from the prior year quarter as a result of lower Compensation and benefits.

•Compensation and benefits expenses decreased in the current quarter primarily due to lower discretionary incentive compensation driven by lower asset management revenues, partially offset by higher salary costs.

•Non-compensation expenses were relatively unchanged.

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Non-interest expenses of $3,321 million in the current year period increased 1% from the prior year period as a result of higher Non-compensation expenses, partially offset with lower Compensation and benefits.

•Compensation and benefits expenses decreased in the current year period primarily due to lower discretionary incentive compensation driven by lower asset management revenues and lower expenses related to certain deferred compensation plans linked to investment performance, partially offset by higher salary costs, including the impact of incremental compensation as a result of the Eaton Vance acquisition.

•Non-compensation expenses increased in the current year period primarily due to incremental expenses as a result of the Eaton Vance acquisition.

Assets under Management or Supervision Rollforwards

$ in billions			Equity			Fixed Income			Alternatives and Solutions			Long-Term AUM Subtotal			Liquidity and Overlay Services			Total
June 30, 2022			$	265		$	181		$	415		$	861		$	490		$	1,351
Inflows			10			13			24			47			572			619
Outflows			(14)			(17)			(15)			(46)			(602)			(648)
Market Impact			(9)			(3)			(15)			(27)			(2)			(29)
Other			(3)			(3)			(4)			(10)			(4)			(14)
September 30, 2022			$	249		$	171		$	405		$	825		$	454		$	1,279

$ in billions			Equity			Fixed Income			Alternatives and Solutions			Long-Term AUM Subtotal			Liquidity and Overlay Services			Total
June 30, 2021			$	404		$	207		$	445		$	1,056		$	468		$	1,524
Inflows			18			17			24			59			462			521
Outflows			(19)			(16)			(23)			(58)			(448)			(506)
Market Impact			(12)			—			—			(12)			—			(12)
Other			—			(2)			(3)			(5)			—			(5)
September 30, 2021			$	391		$	206		$	443		$	1,040		$	482		$	1,522

$ in billions			Equity			Fixed Income			Alternatives and Solutions			Long-Term AUM Subtotal			Liquidity and Overlay Services			Total
December 31, 2021			$	395		$	207		$	466		$	1,068		$	497		$	1,565
Inflows			42			50			74			166			1,675			1,841
Outflows			(60)			(59)			(60)			(179)			(1,702)			(1,881)
Market Impact			(117)			(19)			(67)			(203)			(11)			(214)
Other			(11)			(8)			(8)			(27)			(5)			(32)
September 30, 2022			$	249		$	171		$	405		$	825		$	454		$	1,279

$ in billions			Equity			Fixed Income			Alternatives and Solutions			Long-Term AUM Subtotal			Liquidity and Overlay Services			Total
December 31, 2020			$	242		$	98		$	153		$	493		$	288		$	781
Inflows			73			49			68			190			1,375			1,565
Outflows			(63)			(40)			(53)			(156)			(1,300)			(1,456)
Market Impact			23			1			29			53			4			57
Acquired1			119			103			251			473			116			589
Other			(3)			(5)			(5)			(13)			(1)			(14)
September 30, 2021			$	391		$	206		$	443		$	1,040		$	482		$	1,522

1.Related to the Eaton Vance acquisition.

Average AUM

			Three Months Ended September 30,						Nine Months Ended September 30,
$ in billions			2022			2021			2022			2021
Equity			$	269		$	402		$	308		$	350
Fixed income			179			207			190			173
Alternatives and Solutions			420			451			436			356
Long-term AUM subtotal			868			1,060			934			879
Liquidity and Overlay Services			466			476			469			413
Total AUM			$	1,334		$	1,536		$	1,403		$	1,292

Average Fee Rates1

			Three Months Ended September 30,						Nine Months Ended September 30,
Fee rate in bps			2022			2021			2022			2021
Equity			71			72			70			76
Fixed income			34			37			36			38
Alternatives and Solutions			34			32			34			37
Long-term AUM			46			48			46			53
Liquidity and Overlay Services			13			5			11			6
Total AUM			34			35			35			38

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 and rollforward items 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 2021 Form 10-K.

			16			September 2022 Form 10-Q

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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”) (collectively, “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 the U.S. Bank Subsidiaries from the Institutional Securities business segment primarily includes Secured lending facilities and Commercial real estate loans. Lending activity in the 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.” 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 September 30, 2022			At December 31, 2021
Investment securities portfolio:
Investment securities—AFS			$	65.6		$	81.6
Investment securities—HTM			57.4			61.7
Total investment securities			$	123.0		$	143.3
Wealth Management Loans2
Residential real estate			$	52.8		$	44.2
Securities-based lending and Other3			92.9			85.0
Total, net of ACL			$	145.7		$	129.2
Institutional Securities Loans2
Corporate			$	6.7		$	6.5
Secured lending facilities			36.9			33.1
Commercial and Residential real estate			10.2			10.4
Securities-based lending and Other			5.4			6.3
Total, net of ACL			$	59.2		$	56.3
Total Assets			$	371.2		$	386.1
Deposits4			$	331.9		$	346.2

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.

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 either determined to be not applicable or to not have a material impact on our financial condition or results of operations upon adoption.

The following accounting updates are currently being evaluated, however, we do not expect a material impact on our financial condition or results of operations upon adoption:

•Financial Instruments—Credit Losses. This accounting update eliminates the accounting guidance for Troubled Debt Restructurings (“TDRs”) and requires new disclosures regarding certain modifications of financing receivables (i.e., principal forgiveness, interest rate reductions, other-than-insignificant payment delays and term extensions) to borrowers experiencing financial difficulty. The update also requires disclosure of current period gross charge-offs by year of origination for financing receivables measured at amortized cost. The ASU is effective January 1, 2023 with early adoption permitted.

•Derivatives and Hedging. The accounting update allows entities to designate fair value hedging relationships to multiple layers in a closed portfolio of prepayable and non-prepayable financial assets. It also provides additional guidance on the accounting for and disclosure of hedge basis adjustments under the portfolio layer method. As of the adoption date, entities are permitted to reclassify HTM debt securities to AFS if the securities will be included in a closed portfolio that are designated in a portfolio layer method hedge. The ASU is effective January 1, 2023 with early adoption permitted.

•Fair Value Measurement. This accounting update clarifies, consistent with our current accounting policy, that a contractual restriction on the sale of an equity security is not considered part of the unit of account of the equity security and, therefore, is not considered in measuring fair value. The update also requires additional disclosures including the fair value of equity securities subject to contractual sale restrictions, the nature and remaining duration of the restriction and circumstances that could cause the restriction to lapse. The ASU is effective January 1, 2024 with early adoption permitted.

Critical Accounting Policies

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 2021 Form 10-K and Note 2 to the financial statements), the fair value, goodwill and intangible assets, legal and regulatory contingencies 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 Policies” in the 2021 Form 10-K.

September 2022 Form 10-Q			17

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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 of Directors (“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 Treasury department, 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 September 30, 2022
$ in millions			IS			WM			IM			Total
Assets
Cash and cash equivalents			$	89,524		$	21,911		$	261		$	111,696
Trading assets at fair value			284,683			1,752			4,753			291,188
Investment securities			41,503			119,766			—			161,269
Securities purchased under agreements to resell			100,251			10,873			—			111,124
Securities borrowed			135,570			908			—			136,478
Customer and other receivables			55,202			31,517			1,216			87,935
Loans1			65,169			145,763			4			210,936
Other assets2			14,482			23,977			10,944			49,403
Total assets			$	786,384		$	356,467		$	17,178		$	1,160,029

			At December 31, 2021
$ in millions			IS			WM			IM			Total
Assets
Cash and cash equivalents			$	91,251		$	36,003		$	471		$	127,725
Trading assets at fair value			288,405			1,921			4,543			294,869
Investment securities			41,407			141,591			—			182,998
Securities purchased under agreements to resell			112,267			7,732			—			119,999
Securities borrowed			128,154			1,559			—			129,713
Customer and other receivables			57,009			37,643			1,366			96,018
Loans1			58,822			129,307			5			188,134
Other assets2			14,820			22,682			11,182			48,684
Total assets			$	792,135		$	378,438		$	17,567		$	1,188,140

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 Goodwill and Intangible assets, 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 $1,160 billion at September 30, 2022 were relatively unchanged from $1,188 billion at December 31, 2021.

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 2021 Form 10-K.

At September 30, 2022 and December 31, 2021, 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.

The amount of Liquidity Resources we hold is based on our risk appetite and is calibrated to meet various internal and

			18			September 2022 Form 10-Q

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Management’s Discussion and Analysis

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			September 30, 2022			June 30, 2022
Cash deposits with central banks			$	61,447		$	65,144
Unencumbered HQLA Securities1:
U.S. government obligations			132,788			123,950
U.S. agency and agency mortgage-backed securities			89,279			92,825
Non-U.S. sovereign obligations2			15,812			15,661
Other investment grade securities			607			629
Total HQLA1			$	299,933		$	298,209
Cash deposits with banks (non-HQLA)			8,068			8,161
Total Liquidity Resources			$	308,001		$	306,370

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

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

Liquidity Resources by Bank and Non-Bank Legal Entities

			Average Daily Balance Three Months Ended
$ in millions			September 30, 2022			June 30, 2022
Bank legal entities
U.S.			$	133,306		$	142,290
Non-U.S.			7,607			8,712
Total Bank legal entities			140,913			151,002
Non-Bank legal entities
U.S.:
Parent Company			54,189			43,158
Non-Parent Company			55,098			55,342
Total U.S.			109,287			98,500
Non-U.S.			57,801			56,868
Total Non-Bank legal entities			167,088			155,368
Total Liquidity Resources			$	308,001		$	306,370

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 requires that large banking organizations 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 requires large banking organizations to maintain sufficiently stable sources of funding over a one-year time horizon.

As of September 30, 2022, 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			September 30, 2022			June 30, 2022
Eligible HQLA1
Cash deposits with central banks			$	57,133		$	59,887
Securities2			183,102			169,708
Total Eligible HQLA1			$	240,235		$	229,595
LCR			136		%	128		%

1.Under the LCR rule, Eligible HQLA is calculated using weightings and excluding certain HQLA held in subsidiaries.

2.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, 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.

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 Resources—Funding Management—Secured Financing” in the 2021 Form 10-K.

September 2022 Form 10-Q			19

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Management’s Discussion and Analysis

Collateralized Financing Transactions

$ in millions			At September 30, 2022			At December 31, 2021
Securities purchased under agreements to resell and Securities borrowed			$	247,602		$	249,712
Securities sold under agreements to repurchase and Securities loaned			$	73,230		$	74,487
Securities received as collateral1			$	6,853		$	10,504

			Average Daily Balance Three Months Ended
$ in millions			September 30, 2022			December 31, 2021
Securities purchased under agreements to resell and Securities borrowed			$	261,256		$	236,327
Securities sold under agreements to repurchase and Securities loaned			$	73,487		$	69,565

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 2021 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 2021 Form 10-K.

Deposits

$ in millions			At September 30, 2022			At December 31, 2021
Savings and demand deposits:
Brokerage sweep deposits1			$	233,519		$	298,352
Savings and other			83,610			34,395
Total Savings and demand deposits			317,129			332,747
Time deposits			20,994			14,827
Total2			$	338,123		$	347,574

1.Amounts represent balances swept from client brokerage accounts.

2.Excludes approximately $8 billion and $9 billion of off-balance sheet deposits at unaffiliated financial institutions as of September 30, 2022 and December 31, 2021, respectively. This client cash held by third parties is not reflected in our balance sheet and is not immediately available for liquidity purposes.

Deposits are primarily sourced from our Wealth Management clients and are considered to have stable, low-cost funding

characteristics. Total deposits decreased in the current year period, primarily driven by a reduction in Brokerage sweep deposits, partially offset by higher savings deposits.

Borrowings by Remaining Maturity at September 30, 20221

$ in millions			Parent Company			Subsidiaries			Total
Original maturities of one year or less			$	—		$	4,062		$	4,062
Original maturities greater than one year
2022			$	3,151		$	1,198		$	4,349
2023			13,376			7,491			20,867
2024			19,224			8,798			28,022
2025			21,353			7,632			28,985
2026			21,957			4,785			26,742
Thereafter			81,708			25,688			107,396
Total			$	160,769		$	55,592		$	216,361
Total Borrowings			$	160,769		$	59,654		$	220,423
Maturities over next 12 months2									$	18,755

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

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

Borrowings of $220 billion as of September 30, 2022 were relatively unchanged when compared with $233 billion at December 31, 2021.

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 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 2021 Form 10-K.

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Parent Company and U.S. Bank Subsidiaries Issuer Ratings at October 31, 2022

			Parent Company
			Short-Term Debt			Long-Term Debt			Rating Outlook
DBRS, Inc.			R-1 (middle)			A (high)			Stable
Fitch Ratings, Inc.			F1			A			Positive
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			A+			Positive
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

On May 17, 2022, S&P Global Ratings upgraded the issuer ratings of the Parent Company from BBB+ to A-, and revised the Parent Company outlook from positive to 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 September 30,						Nine Months Ended September 30,
in millions, except for per share data			2022			2021			2022			2021
Number of shares			30			36			93			98
Average price per share			$	85.79		$	99.44		$	87.50		$	88.60
Total			$	2,555		$	3,557		$	8,165		$	8,631

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			October 14, 2022
Amount per share			$0.775
Date to be paid			November 15, 2022
Shareholders of record as of			October 31, 2022

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 16 to the financial statements in the 2021 Form 10-K.

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 an 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

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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 provisionally 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 2021 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 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 September 30, 2022 and December 31, 2021
			Standardized			Advanced
Capital buffers
Capital conservation buffer			—			2.5%
SCB1			5.7%			N/A
G-SIB capital surcharge2			3.0%			3.0%
CCyB3			0%			0%
Capital buffer requirement			8.7%			5.5%

1.For additional information on the SCB, see “Capital Plans, Stress Tests and the Stress Capital Buffer” herein and in the 2021 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 2021 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 Common Equity Tier 1 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 Standardized Approach capital buffer requirement is equal to the sum of our SCB, G-SIB capital surcharge and CCyB, and our Advanced Approach capital buffer requirement is equal to our 2.5% capital conservation buffer, G-SIB capital surcharge and CCyB.

			Regulatory Minimum			At September 30, 2022 and December 31, 2021
						Standardized			Advanced
Required ratios1
Common Equity Tier 1 capital ratio			4.5		%	13.2%			10.0%
Tier 1 capital ratio			6.0		%	14.7%			11.5%
Total capital ratio			8.0		%	16.7%			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 approaches for calculating credit risk and market risk RWA (“Standardized Approach”) and (ii) the applicable advanced approaches for calculating credit risk, market risk and operational risk RWA (“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 September 30, 2022 and December 31, 2021, 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. As of December 31, 2021, our risk-based and leverage-based capital amounts and ratios, as well as RWA, adjusted average assets and supplementary leverage exposure were calculated excluding the effect of the adoption of CECL based on our election to defer this effect over a five-year transition period that began on January 1, 2020. In 2022 the deferral impacts began to phase in at 25% per year and will become fully phased-in beginning in 2025.

Regulatory Capital Ratios

$ in millions			Required Ratio1			At September 30, 2022			At December 31, 2021
Risk-based capital— Standardized
Common Equity Tier 1 capital						$	67,933		$	75,742
Tier 1 capital						76,428			83,348
Total capital						86,139			93,166
Total RWA						457,911			471,921
Common Equity Tier 1 capital ratio			13.2		%	14.8		%	16.0		%
Tier 1 capital ratio			14.7		%	16.7		%	17.7		%
Total capital ratio			16.7		%	18.8		%	19.7		%

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$ in millions			Required Ratio1			At September 30, 2022			At December 31, 2021
Risk-based capital— Advanced
Common Equity Tier 1 capital						$	67,933		$	75,742
Tier 1 capital						76,428			83,348
Total capital						85,763			92,927
Total RWA						447,792			435,749
Common Equity Tier 1 capital ratio			10.0		%	15.2		%	17.4		%
Tier 1 capital ratio			11.5		%	17.1		%	19.1		%
Total capital ratio			13.5		%	19.2		%	21.3		%
$ in millions			Required Ratio1			At September 30, 2022			At December 31, 2021
Leverage-based capital
Adjusted average assets2						$	1,154,411		$	1,169,939
Tier 1 leverage ratio			4.0		%	6.6		%	7.1		%
Supplementary leverage exposure3						$	1,406,345		$	1,476,962
SLR			5.0		%	5.4		%	5.6		%

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

2.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.

3.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.

Regulatory Capital

$ in millions			At September 30, 2022			At December 31, 2021			Change
Common Equity Tier 1 capital
Common stock and surplus			$	3,964		$	11,361		$	(7,397)
Retained earnings			94,240			89,679			4,561
AOCI			(5,758)			(3,102)			(2,656)
Regulatory adjustments and deductions:
Net goodwill			(16,456)			(16,641)			185
Net intangible assets			(6,290)			(6,704)			414
Other adjustments and deductions1			(1,767)			1,149			(2,916)
Total Common Equity Tier 1 capital			$	67,933		$	75,742		$	(7,809)
Additional Tier 1 capital
Preferred stock			$	8,750		$	7,750		$	1,000
Noncontrolling interests			542			562			(20)
Additional Tier 1 capital			$	9,292		$	8,312		$	980
Deduction for investments in covered funds			(797)			(706)			(91)
Total Tier 1 capital			$	76,428		$	83,348		$	(6,920)
Standardized Tier 2 capital
Subordinated debt			$	8,161		$	8,609		$	(448)
Eligible ACL			1,505			1,155			350
Other adjustments and deductions			45			54			(9)
Total Standardized Tier 2 capital			$	9,711		$	9,818		$	(107)
Total Standardized capital			$	86,139		$	93,166		$	(7,027)
Advanced Tier 2 capital
Subordinated debt			$	8,161		$	8,609		$	(448)
Eligible credit reserves			1,129			916			213
Other adjustments and deductions			45			54			(9)
Total Advanced Tier 2 capital			$	9,335		$	9,579		$	(244)
Total Advanced capital			$	85,763		$	92,927		$	(7,164)

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.

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RWA Rollforward

			Nine Months Ended September 30, 2022
$ in millions			Standardized			Advanced
Credit risk RWA
Balance at December 31, 2021			$	416,502		$	285,247
Change related to the following items:
Derivatives			(6,624)			10,507
Securities financing transactions			(8,841)			1,838
Investment securities			(2,842)			(7,456)
Commitments, guarantees and loans			11,446			5,704
Equity investments			(4,054)			(4,256)
Other credit risk			2,817			4,125
Total change in credit risk RWA			$	(8,098)		$	10,462
Balance at September 30, 2022			$	408,404		$	295,709
Market risk RWA
Balance at December 31, 2021			$	55,419		$	55,419
Change related to the following items:
Regulatory VaR			3,434			3,434
Regulatory stressed VaR			242			242
Incremental risk charge			(5,119)			(5,119)
Comprehensive risk measure			(391)			(436)
Specific risk			(4,078)			(4,078)
Total change in market risk RWA			$	(5,912)		$	(5,957)
Balance at September 30, 2022			$	49,507		$	49,462
Operational risk RWA
Balance at December 31, 2021			N/A			$	95,083
Change in operational risk RWA			N/A			7,538
Balance at September 30, 2022			N/A			$	102,621
Total RWA			$	457,911		$	447,792

Regulatory VaR—VaR for regulatory capital requirements

In the current year period, Credit risk RWA decreased under the Standardized Approach, but increased under the Advanced Approach. Under the Standardized Approach, the decrease was primarily driven by lower equity and credit Derivatives as well as lower Securities financing transactions from margin lending, partially offset by lending growth. Under the Advanced Approach, the increase was primarily driven by higher commodities and foreign exchange Derivatives exposures as well as lending growth, partially offset by a decrease in Investment securities.

Market risk RWA decreased in the current year period under both the Standardized and Advanced Approaches primarily driven by lower Incremental Risk Charge driven by exposure reduction in the Fixed Income business and lower Specific risk standardized charges and securitizations, partially offset by higher Regulatory VaR.

The increase in Operational risk RWA in the current year period reflects higher legal expenses and execution-related losses.

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 September 30, 2022			At December 31, 2021
External TLAC2									$	235,864		$	235,681
External TLAC as a % of RWA			18.0		%	21.5		%	51.5		%	49.9		%
External TLAC as a % of leverage exposure			7.5		%	9.5		%	16.8		%	16.0		%
Eligible LTD3									$	149,694		$	144,659
Eligible LTD as a % of RWA			9.0		%	9.0		%	32.7		%	30.7		%
Eligible LTD as a % of leverage exposure			4.5		%	4.5		%	10.6		%	9.8		%

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 September 30, 2022 and December 31, 2021.

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 2021 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.

For the 2022 capital planning and stress test cycle, we submitted our capital plan and company-run stress test results to the Federal Reserve on April 5, 2022. On June 23, 2022, the Federal Reserve published summary results of its supervisory stress tests of each large BHC, in which the projected decline in our Common Equity Tier 1 ratio in the severely adverse scenario improved from the prior annual supervisory stress test, from 4.7% to 4.6%. Following the publication of the supervisory stress test results, and as a

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result of the increase in our common stock dividend and the resulting dividend add-on, we announced that our SCB will be 5.8% from October 1, 2022 through September 30, 2023. Together with other features of the regulatory capital framework, this SCB results in an aggregate Standardized Approach Common Equity Tier 1 ratio of 13.3%. Generally, our SCB is determined annually based on the results of the supervisory stress test.

We also disclosed a summary of the results of our company-run stress tests on our Investor Relations website and increased our quarterly common stock dividend to $0.775 per share from $0.70, beginning with the common stock dividend announced on July 14, 2022. Additionally, our Board of Directors approved a new multi-year repurchase authorization of up to $20 billion of outstanding common stock, without a set expiration date, beginning in the third quarter of 2022, which will be exercised from time to time as conditions warrant.

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 2021 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 common equity. We generally hold Parent 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 September 30,						Nine Months Ended September 30,
$ in billions			2022			2021			2022			2021
Institutional Securities			$	48.8		$	43.5		$	48.8		$	43.5
Wealth Management			31.0			28.6			31.0			28.6
Investment Management2			10.6			10.7			10.6			8.2
Parent			2.5			15.8			4.3			16.6
Total			$	92.9		$	98.6		$	94.7		$	96.9

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

2. The total average common equity and the allocation to the Investment Management business segment in 2021 reflect the Eaton Vance acquisition on March 1, 2021.

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 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 2021 targeted resolution plan on June 30, 2021. On July 1, 2022, the Federal Reserve and the FDIC announced that they have extended the period for issuing feedback for the U.S. G-SIBs’ 2021 resolution plans to allow the agencies additional time to analyze them.

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 material entities and/or the Funding IHC. The Funding IHC would be obligated to provide capital and liquidity, as applicable, to our material 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 long-term debt and other forms of eligible TLAC issued by the Parent Company before any losses are imposed on creditors of our material 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

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Resources—Regulatory Requirements—Resolution and Recovery Planning” in the 2021 Form 10-K.

Regulatory Developments and Other Matters

Covered Funds Restrictions under the Volcker Rule

The Volcker Rule prohibits certain investments and relationships by banking entities with covered funds, as defined in the Volcker Rule. We requested and received additional time until July 21, 2023 to conform investments in certain legacy illiquid funds. During the current quarter, we have continued our efforts to conform these illiquid funds by July 21, 2023, including but not limited to assessing alternative conformance options permitted under the Volcker Rule. As a result, as of September 30, 2022, we continued to estimate the fair value of our investments in such covered funds using the net asset value per share (“NAV”), which approximated $300 million. For additional information on the Volcker Rule, see “Business—Supervision and Regulation—Financial Holding Company—Activities Restrictions Under the Volcker Rule” in the 2021 Form 10-K. For information on investments measured at NAV, see Note 4 to the financial statements.

Replacement of London Interbank Offered Rate and Replacement or Reform of Other Interest Rate Benchmarks

Central banks around the world, including the Federal Reserve, have commissioned committees and working groups of market participants and official sector representatives to replace LIBOR and replace or reform other interest rate benchmarks (collectively, the “IBORs”). A transition away from use of the IBORs to alternative rates and other potential interest rate benchmark reforms is underway and will continue through the cessation dates.

The publication of most non-U.S. dollar LIBOR rates ceased as of the end of December 2021. The publication of certain non-U.S. dollar LIBOR rates on the basis of a “synthetic” methodology (known as “synthetic LIBOR”) will continue at least until the end of 2022 and certain U.S. dollar LIBOR tenors are expected to continue to be published until June 30, 2023. On March 15, 2022 the U.S. enacted federal legislation that is intended to minimize legal and economic uncertainty following U.S. dollar LIBOR’s cessation by replacing LIBOR references in certain contracts under certain circumstances with a SOFR-based rate to be established in a Federal Reserve rule that incorporates a spread adjustment specified in the statute. On July 19, 2022, the Federal Reserve issued a proposed rule to implement the federal legislation. While some states have already adopted LIBOR legislation, the federal legislation expressly preempts any provision of any state or local law, statute, rule, regulation or standard.

As of September 30, 2022, our LIBOR-referenced contracts were primarily concentrated in derivative contracts and to a lesser extent, loans, floating rate notes, preferred shares, securitizations and mortgages. A significant majority of our

derivative contracts, and a majority of our non-derivative contracts contain fallback provisions or otherwise have an expected path that will allow for the transition to an alternative reference rate upon the cessation of the applicable LIBOR rate.

While we have made substantial progress in the transition away from the IBORs, we nonetheless currently remain party to a significant number of U.S. dollar LIBOR-linked contracts. For the limited number of U.S. dollar LIBOR-linked contracts without a current market standard fallback, or for which the federal legislation does not apply, we are actively developing appropriate transition plans in light of the planned June 30, 2023 cessation date for the remaining U.S. dollar LIBOR tenors.

Our IBOR transition plan is overseen by a global steering committee, with senior management oversight, and we continue to execute against our Firm-wide IBOR transition plan to complete the transition to alternative reference rates.

See also “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Regulatory Requirements—Regulatory Developments and Other Matters” and “Risk Factors—Risk Management” in the 2021 Form 10-K for a further discussion of the replacement of the IBORs and/or reform of other interest rate benchmarks and related risks.

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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 2021 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 2021 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 2021 Form 10-K.

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

			Three Months Ended
			September 30, 2022
$ in millions			Period End			Average			High1			Low1
Interest rate and credit spread			$	36		$	34		$	38		$	30
Equity price			22			24			31			19
Foreign exchange rate			9			8			12			5
Commodity price			26			30			36			24
Less: Diversification benefit2			(37)			(39)			N/A			N/A
Primary Risk Categories			$	56		$	57		$	65		$	49
Credit Portfolio			16			16			18			15
Less: Diversification benefit2			(11)			(12)			N/A			N/A
Total Management VaR			$	61		$	61		$	74		$	50

			Three Months Ended
			June 30, 2022
$ in millions			Period End			Average			High1			Low1
Interest rate and credit spread			$	33		$	30		$	43		$	24
Equity price			24			24			28			19
Foreign exchange rate			6			7			15			4
Commodity price			24			31			40			24
Less: Diversification benefit2			(42)			(48)			N/A			N/A
Primary Risk Categories			$	45		$	44		$	57		$	36
Credit Portfolio			15			15			18			14
Less: Diversification benefit2			(10)			(13)			N/A			N/A
Total Management VaR			$	50		$	46		$	57		$	40

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 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 June 30, 2022, primarily from an increase in interest rate and credit spread risk categories driven by market volatility and a reduction in diversification benefit.

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 loss days in the current quarter, which did not exceed 95% Total Management VaR.

September 2022 Form 10-Q			27

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

($ in millions)

Daily Net Trading Revenues for the Current Quarter

($ in millions)

The previous histogram shows the distribution of daily net trading revenues for the current quarter. 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 September 30, 2022			At June 30, 2022
Derivatives			$	7		$	7
Borrowings carried at fair value			33			38

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

Credit spread risk sensitivity for borrowings carried at fair value at September 30, 2022 decreased from June 30, 2022 primarily due to widening credit spreads, partially offset by new debt issuance.

The Wealth Management business segment reflects a substantial portion of our non-trading interest rate risk. Historically, net interest income sensitivity for our U.S. Bank Subsidiaries was representative of such sensitivity for the Wealth Management business segment and, accordingly, we presented net interest income sensitivity for our U.S. Bank Subsidiaries. However, over time the Wealth Management business segment has grown its assets that generate net interest income outside of the U.S. Bank Subsidiaries, such as margin and other lending on non-bank entities, and this growth has been further accelerated by the acquisition of E*TRADE. Net interest in the Wealth Management business segment primarily consists of interest income earned on non-trading assets, 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 Analysis1

$ in millions			At September 30, 2022			At June 30, 2022
Basis point change
+100			$	398		$	93
-100			(568)			(360)

1.The prior period has been revised to conform to the current period presentation.

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 and our forecasted business activity.

We do not manage to any single rate scenario but rather manage net interest income in our Wealth Management business segment to optimize 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. Net interest income sensitivity to interest rates at September

			28			September 2022 Form 10-Q

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Risk Disclosures

30, 2022 increased from June 30, 2022, primarily driven by the changes in deposit pricing, mix and expected customer behavior.

Investments Sensitivity, Including Related Carried Interest

			Loss from 10% Decline
$ in millions			At September 30, 2022			At June 30, 2022
Investments related to Investment Management activities			$	423		$	423
Other investments:
MUMSS			131			139
Other Firm investments			348			348

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.

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 2021 Form 10-K.

Loans and Lending Commitments

			At September 30, 2022
$ in millions			HFI			HFS			FVO			Total
Institutional Securities:
Corporate			$	6,858		$	7,640		$	—		$	14,498
Secured lending facilities			34,788			3,707			7			38,502
Commercial and Residential real estate			8,191			1,750			2,044			11,985
Securities-based lending and Other			2,728			109			5,013			7,850
Total Institutional Securities			52,565			13,206			7,064			72,835
Wealth Management:
Residential real estate			52,904			5			—			52,909
Securities-based lending and Other			92,859			142			—			93,001
Total Wealth Management			145,763			147			—			145,910
Total Investment Management1			4			—			448			452
Total loans2			198,332			13,353			7,512			219,197
ACL			(749)									(749)
Total loans, net of ACL			$	197,583		$	13,353		$	7,512		$	218,448
Lending commitments3												$	136,605
Total exposure												$	355,053

			At December 31, 2021
$ in millions			HFI			HFS			FVO			Total
Institutional Securities:
Corporate			$	5,567		$	8,107		$	8		$	13,682
Secured lending facilities			31,471			3,879			—			35,350
Commercial and Residential real estate			7,227			1,777			4,774			13,778
Securities-based lending and Other			1,292			45			7,710			9,047
Total Institutional Securities			45,557			13,808			12,492			71,857
Wealth Management:
Residential real estate			44,251			7			—			44,258
Securities-based lending and Other			85,143			17			—			85,160
Total Wealth Management			129,394			24			—			129,418
Total Investment Management1			5			—			135			140
Total loans2			174,956			13,832			12,627			201,415
ACL			(654)									(654)
Total loans, net of ACL			$	174,302		$	13,832		$	12,627		$	200,761
Lending commitments3												$	134,934
Total exposure												$	335,695

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

1.Investment Management business segment loans are related to certain of our activities as an investment advisor 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.

2.FVO also includes the fair value of certain unfunded lending commitments.

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.

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 2021 Form 10-K.

September 2022 Form 10-Q			29

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Total loans and lending commitments increased by approximately $19 billion since December 31, 2021, primarily due to growth in Residential real estate loans and Securities-based loans within the Wealth Management 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
ACL—Loans			$	654
ACL—Lending Commitments			444
Total at December 31, 2021			1,098
Gross charge-offs			(31)
Recoveries			7
Net (charge-offs) recoveries			(24)
Provision for credit losses			193
Other			(31)
Total at September 30, 2022			$	1,236
ACL—Loans			$	749
ACL—Lending commitments			487

Provision for Credit Losses by Business Segment

			Three Months Ended September 30, 2022									Nine Months Ended September 30, 2022
$ in millions			IS			WM			Total			IS			WM			Total
Loans			$	(9)		$	15		$	6		$	88		$	49		$	137
Lending commitments			33			(4)			29			62			(6)			56
Total			$	24		$	11		$	35		$	150		$	43		$	193

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 aggregate allowance for credit losses for loans and lending commitments increased in the current year period, reflecting the Provision for credit losses due to portfolio growth and deterioration in macroeconomic outlook.

The base scenario used in our ACL models as of September 30, 2022 was generated using a combination of consensus economic forecasts, forward rates, and internally developed and validated models, and assumes slower economic growth over the forecast period. Given the nature of our lending portfolio, the most sensitive model input is U.S. gross domestic product.

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

			4Q 2022			4Q 2023
Year-over-year growth rate			0.8		%	1.3		%

See Note 9 to the financial statements for further information. See Note 2 to the financial statements in the 2021 Form 10-K for a discussion of the Firm’s ACL methodology under CECL.

Status of Loans Held for Investment

			At September 30, 2022						At December 31, 2021
			IS			WM			IS			WM
Accrual			99.4		%	99.9		%	98.7		%	99.8		%
Nonaccrual1			0.6		%	0.1		%	1.3		%	0.2		%

1.These loans are on nonaccrual status because the loans were past due for a period of 90 days or more or payment of principal or interest was in doubt.

Net Charge-off Ratios for Loans Held for Investment

$ in millions			Corporate			Secured Lending Facilities			CRE			Residential Real Estate			SBL and Other			Total
For the Nine Months Ended September 30, 2022
Net charge-off (recovery) ratio1			(0.09)		%	0.01		%	0.09		%	—		%	0.02		%	0.01		%
Average loans			$	6,441		$	32,367		$	8,196		$	48,675		$	92,681		$	188,360
For the Nine Months Ended September 30, 2021
Net charge-off ratio1			0.37		%	0.25		%	0.30		%	—		%	—		%	0.07		%
Average loans			$	5,182		$	27,151		$	7,066		$	37,897		$	72,484		$	149,780

1.Net charge-off ratio represents gross charge-offs net of recoveries divided by total average loans held for investment before ACL.

Institutional Securities Loans and Lending Commitments1

			At September 30, 2022
			Contractual Years to Maturity
$ in millions			<1			1-5			5-15			>15			Total
Loans
AA			$	58		$	4		$	150		$	—		$	212
A			987			1,148			225			—			2,360
BBB			6,960			10,505			564			—			18,029
BB			9,865			19,845			1,322			124			31,156
Other NIG			5,028			10,573			1,886			133			17,620
Unrated2			71			616			699			1,470			2,856
Total loans, net of ACL			22,969			42,691			4,846			1,727			72,233
Lending commitments
AAA			—			50			—			—			50
AA			2,116			2,896			245			—			5,257
A			4,279			19,271			272			324			24,146
BBB			7,007			40,213			879			—			48,099
BB			3,820			18,084			948			52			22,904
Other NIG			882			13,767			4,498			—			19,147
Unrated2			—			38			—			2			40
Total lending commitments			18,104			94,319			6,842			378			119,643
Total exposure			$	41,073		$	137,010		$	11,688		$	2,105		$	191,876

			30			September 2022 Form 10-Q

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			At December 31, 2021
			Contractual Years to Maturity
$ in millions			<1			1-5			5-15			>15			Total
Loans
AA			$	—		$	35		$	38		$	—		$	73
A			890			1,089			675			—			2,654
BBB			5,335			8,944			563			—			14,842
BB			10,734			18,349			814			18			29,915
Other NIG			4,656			10,475			3,439			160			18,730
Unrated2			171			665			511			3,753			5,100
Total loans, net of ACL			21,786			39,557			6,040			3,931			71,314
Lending commitments
AAA			—			50			—			—			50
AA			3,283			2,690			—			—			5,973
A			5,255			17,646			407			303			23,611
BBB			6,703			36,096			766			—			43,565
BB			2,859			19,698			3,122			—			25,679
Other NIG			992			13,420			6,180			55			20,647
Unrated2			672			40			3			—			715
Total lending commitments			19,764			89,640			10,478			358			120,240
Total exposure			$	41,550		$	129,197		$	16,518		$	4,289		$	191,554

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 September 30, 2022			At December 31, 2021
Industry
Financials			$	52,630		$	52,066
Real estate			32,325			31,560
Communications services			15,386			12,645
Industrials			14,555			17,446
Information technology			12,834			13,471
Healthcare			11,863			12,618
Consumer discretionary			11,352			11,628
Utilities			10,301			10,310
Energy			9,170			8,544
Consumer staples			8,186			7,855
Materials			6,296			6,394
Insurance			5,300			4,954
Other			1,678			2,063
Total exposure			$	191,876		$	191,554

Institutional Securities Lending Activities

The Institutional Securities business segment lending activities include Corporate, Secured lending facilities, Commercial real estate and Securities-based lending and Other. As of September 30, 2022, 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 2021 Form 10-K.

Institutional Securities Event-Driven Loans and Lending Commitments

			At September 30, 2022
			Contractual Years to Maturity
$ in millions			<1			1-5			5-15						Total
Loans, net of ACL			$	1,605		$	1,564		$	1,282					$	4,451
Lending commitments			1,400			6,436			4,787						12,623
Total exposure			$	3,005		$	8,000		$	6,069					$	17,074

			At December 31, 2021
			Contractual Years to Maturity
$ in millions			<1			1-5			5-15						Total
Loans, net of ACL			$	951		$	2,088		$	1,803					$	4,842
Lending commitments			1,619			5,288			8,879						15,786
Total exposure			$	2,570		$	7,376		$	10,682					$	20,628

Event-driven loans and lending commitments are associated with a particular event or transaction, such as to support client 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 September 30, 2022
$ in millions			Loans			Lending Commitments			Total
Corporate			$	6,858		$	75,801		$	82,659
Secured lending facilities			34,788			11,617			46,405
Commercial real estate			8,191			433			8,624
Securities-based lending and Other			2,728			992			3,720
Total, before ACL			$	52,565		$	88,843		$	141,408
ACL			$	(602)		$	(475)		$	(1,077)

						At December 31, 2021
$ in millions									Loans			Lending Commitments			Total
Corporate									$	5,567		$	73,585		$	79,152
Secured lending facilities									31,471			10,003			41,474
Commercial real estate									7,227			1,475			8,702
Securities-based lending and Other									1,292			887			2,179
Total, before ACL									$	45,557		$	85,950		$	131,507
ACL									$	(543)		$	(426)		$	(969)

September 2022 Form 10-Q			31

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Institutional Securities Allowance for Credit Losses—Loans and Lending Commitments

$ in millions			Corporate			Secured Lending Facilities			Commercial Real Estate			Other			Total
ACL—Loans			$	165		$	163		$	206		$	9		$	543
ACL—Lending commitments			356			41			20			9			426
Total at December 31, 2021			$	521		$	204		$	226		$	18		$	969
Gross charge-offs			—			(3)			(7)			(7)			(17)
Recoveries			6			—			—			—			6
Net (charge-offs) recoveries			6			(3)			(7)			(7)			(11)
Provision for credit losses			110			5			29			6			150
Other			(18)			(3)			(10)			—			(31)
Total at September 30, 2022			$	619		$	203		$	238		$	17		$	1,077
ACL—Loans			$	211		$	156		$	224		$	11		$	602
ACL—Lending commitments			408			47			14			6			475

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

			At September 30, 2022			At December 31, 2021
Corporate			3.1		%	3.0		%
Secured lending facilities			0.4		%	0.5		%
Commercial real estate			2.7		%	2.9		%
Securities-based lending and Other			0.4		%	0.7		%
Total Institutional Securities loans			1.1		%	1.2		%

Wealth Management Loans and Lending Commitments

			At September 30, 2022
			Contractual Years to Maturity
$ in millions			<1			1-5			5-15			>15			Total
Securities-based lending and Other loans			$	81,996		$	9,204		$	1,610		$	131		$	92,941
Residential real estate loans			2			24			1,359			51,437			52,822
Total loans, net of ACL			$	81,998		$	9,228		$	2,969		$	51,568		$	145,763
Lending commitments			12,367			4,252			48			295			16,962
Total exposure			$	94,365		$	13,480		$	3,017		$	51,863		$	162,725

			At December 31, 2021
			Contractual Years to Maturity
$ in millions			<1			1-5			5-15			>15			Total
Securities-based lending and Other loans			$	74,466		$	8,927		$	1,571		$	144		$	85,108
Residential real estate loans			4			10			1,231			42,954			44,199
Total loans, net of ACL			$	74,470		$	8,937		$	2,802		$	43,098		$	129,307
Lending commitments			11,894			2,467			51			282			14,694
Total exposure			$	86,364		$	11,404		$	2,853		$	43,380		$	144,001

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. For more information about our Securities-based lending and Residential real estate loans, see “Quantitative and Qualitative Disclosures about Risk—Credit Risk” in the 2021 Form 10-K.

Wealth Management Allowance for Credit Losses—Loans and Lending Commitments

$ in millions
ACL—Loans			$	111
ACL—Lending commitments			18
Total at December 31, 2021			129
Gross charge-offs			(14)
Recoveries			1
Net (charge-offs) recoveries			(13)
Provision for credit losses			43
Total at September 30, 2022			$	159
ACL—Loans			$	147
ACL—Lending commitments			12

At September 30, 2022, 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 September 30, 2022			At December 31, 2021
Institutional Securities			$	19,109		$	40,545
Wealth Management			24,306			30,987
Total			$	43,415		$	71,532

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 2021 Form 10-K.

Employee Loans

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

			32			September 2022 Form 10-Q

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Table of Contents
Risk Disclosures

Derivatives

Fair Value of OTC Derivative Assets

			Counterparty Credit Rating1
$ in millions			AAA			AA			A			BBB			NIG			Total
At September 30, 2022
Less than 1 year			$	3,523		$	35,580		$	63,540		$	49,825		$	16,985		$	169,453
1-3 years			1,846			9,595			24,041			25,556			10,411			71,449
3-5 years			889			7,259			10,868			10,975			4,959			34,950
Over 5 years			4,267			37,745			51,423			50,685			9,183			153,303
Total, gross			$	10,525		$	90,179		$	149,872		$	137,041		$	41,538		$	429,155
Counterparty netting			(4,820)			(70,458)			(103,445)			(104,828)			(24,463)			(308,014)
Cash and securities collateral			(3,115)			(16,036)			(38,904)			(20,461)			(7,467)			(85,983)
Total, net			$	2,590		$	3,685		$	7,523		$	11,752		$	9,608		$	35,158

			Counterparty Credit Rating1
$ in millions			AAA			AA			A			BBB			NIG			Total
At December 31, 2021
Less than 1 year			$	1,561		$	11,088		$	32,069		$	25,680		$	11,924		$	82,322
1-3 years			780			4,577			16,821			15,294			6,300			43,772
3-5 years			593			4,807			6,805			8,030			3,317			23,552
Over 5 years			4,359			26,056			61,091			44,091			4,633			140,230
Total, gross			$	7,293		$	46,528		$	116,786		$	93,095		$	26,174		$	289,876
Counterparty netting			(3,093)			(36,957)			(91,490)			(68,365)			(11,642)			(211,547)
Cash and securities collateral			(3,539)			(7,608)			(20,500)			(17,755)			(5,762)			(55,164)
Total, net			$	661		$	1,963		$	4,796		$	6,975		$	8,770		$	23,165

$ in millions			At September 30, 2022			At December 31, 2021
Industry
Financials			$	11,201		$	5,096
Utilities			7,436			5,918
Energy			5,574			2,587
Industrials			2,444			985
Regional governments			2,163			963
Sovereign governments			1,316			386
Communications services			1,235			348
Insurance			625			174
Consumer Discretionary			611			3,069
Consumer staples			596			324
Information technology			526			1,060
Healthcare			478			682
Not-for-profit organizations			220			531
Materials			201			240
Real estate			54			280
Other			478			522
Total			$	35,158		$	23,165

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. In 2022, our exposure to credit risk arising from OTC derivatives has increased, primarily as a function of the effect of market factors and volatility on the valuation of our positions. For more information on derivatives, see “Quantitative and Qualitative Disclosures about Risk—Credit Risk—Derivatives” in the 2021 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 2021 Form 10-K.

Top 10 Non-U.S. Country Exposures at September 30, 2022

$ in millions			United Kingdom			Germany			Japan			France			Brazil
Sovereign
Net inventory1			$	(1,289)		$	1,931		$	4,714		$	2,925		$	3,045
Net counterparty exposure2			19			268			146			8			—
Exposure before hedges			(1,270)			2,199			4,860			2,933			3,045
Hedges3			(250)			(284)			(168)			(6)			(109)
Net exposure			$	(1,520)		$	1,915		$	4,692		$	2,927		$	2,936
Non-sovereign
Net inventory1			$	1,975		$	462		$	749		$	329		$	118
Net counterparty exposure2			15,075			4,126			3,695			3,888			497
Loans			5,056			1,101			357			438			254
Lending commitments			5,922			3,556			—			2,400			405
Exposure before hedges			28,028			9,245			4,801			7,055			1,274
Hedges3			(1,706)			(1,590)			(559)			(1,836)			(39)
Net exposure			$	26,322		$	7,655		$	4,242		$	5,219		$	1,235
Total net exposure			$	24,802		$	9,570		$	8,934		$	8,146		$	4,171

$ in millions			Canada			China			Spain			Korea			Netherlands
Sovereign
Net inventory1			$	67		$	(271)		$	(152)		$	1,136		$	40
Net counterparty exposure2			53			574			41			679			—
Exposure before hedges			120			303			(111)			1,815			40
Hedges3			—			(65)			(8)			(37)			(17)
Net exposure			$	120		$	238		$	(119)		$	1,778		$	23
Non-sovereign
Net inventory1			$	739		$	1,207		$	426		$	229		$	123
Net counterparty exposure2			1,781			1,252			984			915			1,428
Loans			204			393			1,938			131			484
Lending commitments			1,358			680			816			25			1,429
Exposure before hedges			4,082			3,532			4,164			1,300			3,464
Hedges3			(161)			(99)			(923)			(12)			(589)
Net exposure			$	3,921		$	3,433		$	3,241		$	1,288		$	2,875
Total net exposure			$	4,041		$	3,671		$	3,122		$	3,066		$	2,898

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 2021 Form 10-K.

September 2022 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 September 30, 2022
Country of Risk			Collateral2
United Kingdom			U.K., U.S. and France			$	14,632
Japan			Japan and U.S.			9,008
Other			Netherlands, France, and Germany			28,854

1.The benefit of collateral received is reflected in the Top 10 Non-U.S. Country Exposures at September 30, 2022.

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., cyber attacks 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 2021 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 2021 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 2021 Form 10-K and “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources” herein.

Legal and Compliance Risk

Legal 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 and Compliance Risk” in the 2021 Form 10-K.

			34			September 2022 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 September 30, 2022, and the related condensed consolidated income statements, comprehensive income statements and statements of changes in total equity for the three-month and nine-month periods ended September 30, 2022 and 2021, and the cash flow statements for the nine-month periods ended September 30, 2022 and 2021, 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, 2021, 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 24, 2022, 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, 2021 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
November 3, 2022

September 2022 Form 10-Q			35

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Consolidated Income Statement (Unaudited)

			Three Months Ended September 30,						Nine Months Ended September 30,
in millions, except per share data			2022			2021			2022			2021
Revenues
Investment banking			$	1,373		$	3,013		$	4,281		$	8,413
Trading			3,331			2,861			10,911			10,416
Investments			(168)			45			(70)			744
Commissions and fees			1,133			1,280			3,769			4,214
Asset management			4,744			5,201			14,775			14,572
Other			63			290			245			916
Total non-interest revenues			10,476			12,690			33,911			39,275
Interest income			6,101			2,351			12,363			7,000
Interest expense			3,591			288			5,355			1,044
Net interest			2,510			2,063			7,008			5,956
Net revenues			12,986			14,753			40,919			45,231
Provision for credit losses			35			24			193			(1)
Non-interest expenses
Compensation and benefits			5,614			5,920			17,438			19,141
Brokerage, clearing and exchange fees			847			825			2,607			2,530
Information processing and communications			874			788			2,560			2,286
Professional services			755			734			2,217			2,104
Occupancy and equipment			429			427			1,286			1,246
Marketing and business development			215			146			610			438
Other			829			1,015			2,713			2,703
Total non-interest expenses			9,563			9,855			29,431			30,448
Income before provision for income taxes			3,388			4,874			11,295			14,784
Provision for income taxes			726			1,150			2,382			3,380
Net income			$	2,662		$	3,724		$	8,913		$	11,404
Net income applicable to noncontrolling interests			30			17			120			66
Net income applicable to Morgan Stanley			$	2,632		$	3,707		$	8,793		$	11,338
Preferred stock dividends			138			123			366			364
Earnings applicable to Morgan Stanley common shareholders			$	2,494		$	3,584		$	8,427		$	10,974
Earnings per common share
Basic			$	1.49		$	2.01		$	4.95		$	6.11
Diluted			$	1.47		$	1.98		$	4.88		$	6.02
Average common shares outstanding
Basic			1,674			1,781			1,704			1,797
Diluted			1,697			1,812			1,725			1,824

Consolidated Comprehensive Income Statement

(Unaudited)

			Three Months Ended September 30,						Nine Months Ended September 30,
$ in millions			2022			2021			2022			2021
Net income			$	2,662		$	3,724		$	8,913		$	11,404
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustments			(268)			(78)			(661)			(256)
Change in net unrealized gains (losses) on available-for-sale securities			(1,307)			(256)			(4,778)			(1,039)
Pension and other			5			5			13			22
Change in net debt valuation adjustment			816			147			2,628			470
Total other comprehensive income (loss)			$	(754)		$	(182)		$	(2,798)		$	(803)
Comprehensive income			$	1,908		$	3,542		$	6,115		$	10,601
Net income applicable to noncontrolling interests			30			17			120			66
Other comprehensive income (loss) applicable to noncontrolling interests			(17)			(4)			(142)			(64)
Comprehensive income applicable to Morgan Stanley			$	1,895		$	3,529		$	6,137		$	10,599

September 2022 Form 10-Q			36			See Notes to Consolidated Financial Statements

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Consolidated Balance Sheet

$ in millions, except share data			(Unaudited) At September 30, 2022			At December 31, 2021
Assets
Cash and cash equivalents			$	111,696		$	127,725
Trading assets at fair value ($100,709 and $104,186 were pledged to various parties)			291,188			294,869
Investment securities (includes $83,633 and $102,830 at fair value)			161,269			182,998
Securities purchased under agreements to resell (includes $— and $7 at fair value)			111,124			119,999
Securities borrowed			136,478			129,713
Customer and other receivables			87,935			96,018
Loans:
Held for investment (net of allowance for credit losses of $749 and $654)			197,583			174,302
Held for sale			13,353			13,832
Goodwill			16,721			16,833
Intangible assets (net of accumulated amortization of $4,250 and $3,819)			7,893			8,360
Other assets			24,789			23,491
Total assets			$	1,160,029		$	1,188,140
Liabilities
Deposits (includes $3,661 and $1,940 at fair value)			$	338,123		$	347,574
Trading liabilities at fair value			162,640			158,328
Securities sold under agreements to repurchase (includes $951 and $791 at fair value)			60,133			62,188
Securities loaned			13,097			12,299
Other secured financings (includes $4,594 and $5,133 at fair value)			7,701			10,041
Customer and other payables			229,463			228,685
Other liabilities and accrued expenses			26,360			29,300
Borrowings (includes $68,788 and $76,340 at fair value)			220,423			233,127
Total liabilities			1,057,940			1,081,542
Commitments and contingent liabilities (see Note 13)
Equity
Morgan Stanley shareholders’ equity:
Preferred stock			8,750			7,750
Common stock, $0.01 par value:
Shares authorized: 3,500,000,000; Shares issued: 2,038,893,979; Shares outstanding: 1,694,051,265 and 1,772,226,530			20			20
Additional paid-in capital			28,893			28,841
Retained earnings			94,055			89,432
Employee stock trusts			4,860			3,955
Accumulated other comprehensive income (loss)			(5,758)			(3,102)
Common stock held in treasury at cost, $0.01 par value (344,842,714 and 266,667,449 shares)			(24,949)			(17,500)
Common stock issued to employee stock trusts			(4,860)			(3,955)
Total Morgan Stanley shareholders’ equity			101,011			105,441
Noncontrolling interests			1,078			1,157
Total equity			102,089			106,598
Total liabilities and equity			$	1,160,029		$	1,188,140

See Notes to Consolidated Financial Statements			37			September 2022 Form 10-Q

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Table of Contents
Consolidated Statement of Changes in Total Equity (Unaudited)

			Three Months Ended September 30,						Nine Months Ended September 30,
$ in millions			2022			2021			2022			2021
Preferred Stock
Beginning balance			$	7,750		$	7,750		$	7,750		$	9,250
Issuance of preferred stock			1,000			—			1,000			—
Redemption of preferred stock			—			—			—			(1,500)
Ending balance			8,750			7,750			8,750			7,750
Common Stock
Beginning and ending balance			20			20			20			20
Additional Paid-in Capital
Beginning balance			28,394			28,030			28,841			25,546
Share-based award activity			505			473			57			765
Issuance of preferred stock			(6)			—			(6)			—
Issuance of common stock for the acquisition of Eaton Vance			—			—			—			2,185
Other net increases (decreases)			—			1			1			8
Ending balance			28,893			28,504			28,893			28,504
Retained Earnings
Beginning balance			92,889			84,791			89,432			78,694
Net income applicable to Morgan Stanley			2,632			3,707			8,793			11,338
Preferred stock dividends1			(138)			(123)			(366)			(364)
Common stock dividends1			(1,329)			(1,276)			(3,802)			(2,562)
Other net increases (decreases)			1			—			(2)			(7)
Ending balance			94,055			87,099			94,055			87,099
Employee Stock Trusts
Beginning balance			4,900			3,768			3,955			3,043
Share-based award activity			(40)			2			905			727
Ending balance			4,860			3,770			4,860			3,770
Accumulated Other Comprehensive Income (Loss)
Beginning balance			(5,021)			(2,523)			(3,102)			(1,962)
Net change in Accumulated other comprehensive income (loss)			(737)			(178)			(2,656)			(739)
Ending balance			(5,758)			(2,701)			(5,758)			(2,701)
Common Stock Held in Treasury at Cost
Beginning balance			(22,436)			(11,198)			(17,500)			(9,767)
Share-based award activity			95			57			1,677			1,094
Repurchases of common stock and employee tax withholdings			(2,608)			(3,628)			(9,126)			(9,228)
Issuance of common stock for the acquisition of Eaton Vance			—			—			—			3,132
Ending balance			(24,949)			(14,769)			(24,949)			(14,769)
Common Stock Issued to Employee Stock Trusts
Beginning balance			(4,900)			(3,768)			(3,955)			(3,043)
Share-based award activity			40			(2)			(905)			(727)
Ending balance			(4,860)			(3,770)			(4,860)			(3,770)
Noncontrolling Interests
Beginning balance			1,066			1,292			1,157			1,368
Net income applicable to noncontrolling interests			30			17			120			66
Net change in Accumulated other comprehensive income (loss) applicable to noncontrolling interests			(17)			(4)			(142)			(64)
Other net increases (decreases)			(1)			(89)			(57)			(154)
Ending balance			1,078			1,216			1,078			1,216
Total Equity			$	102,089		$	107,119		$	102,089		$	107,119

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

September 2022 Form 10-Q			38			See Notes to Consolidated Financial Statements

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Consolidated Cash Flow Statement (Unaudited)

			Nine Months Ended September 30,
$ in millions			2022			2021
Cash flows from operating activities
Net income			$	8,913		$	11,404
Adjustments to reconcile net income to net cash provided by (used for) operating activities:
Stock-based compensation expense			1,377			1,636
Depreciation and amortization			2,791			2,979
Provision for credit losses			193			(1)
Other operating adjustments			508			(149)
Changes in assets and liabilities:
Trading assets, net of Trading liabilities			(23,285)			2,832
Securities borrowed			(6,765)			(13,531)
Securities loaned			798			3,402
Customer and other receivables and other assets			7,966			(2,692)
Customer and other payables and other liabilities			8,283			19,829
Securities purchased under agreements to resell			8,875			(3,487)
Securities sold under agreements to repurchase			(2,055)			11,400
Net cash provided by (used for) operating activities			7,599			33,622
Cash flows from investing activities
Proceeds from (payments for):
Other assets—Premises, equipment and software, net			(2,308)			(1,658)
Changes in loans, net			(23,280)			(23,197)
AFS securities1:
Purchases			(22,636)			(32,483)
Proceeds from sales			21,922			18,325
Proceeds from paydowns and maturities			11,682			21,508
HTM securities1:
Purchases			(5,231)			(24,851)
Proceeds from paydowns and maturities			7,837			10,860
Cash paid as part of the Eaton Vance acquisition, net of cash acquired			—			(2,648)
Other investing activities			(516)			(447)
Net cash provided by (used for) investing activities			(12,530)			(34,591)
Cash flows from financing activities
Net proceeds from (payments for):
Other secured financings			(1,352)			(1,125)
Deposits			(16,816)			18,347
Issuance of preferred stock, net of issuance costs			994			—
Proceeds from issuance of Borrowings			54,283			73,591
Payments for:
Borrowings			(27,019)			(56,699)
Repurchases of common stock and employee tax withholdings			(9,126)			(9,228)
Cash dividends			(4,023)			(2,857)
Other financing activities			(202)			(197)
Net cash provided by (used for) financing activities			(3,261)			21,832
Effect of exchange rate changes on cash and cash equivalents			(7,837)			(2,654)
Net increase (decrease) in cash and cash equivalents			(16,029)			18,209
Cash and cash equivalents, at beginning of period			127,725			105,654
Cash and cash equivalents, at end of period			$	111,696		$	123,863
Supplemental Disclosure of Cash Flow Information
Cash payments for:
Interest			$	4,339		$	1,236
Income taxes, net of refunds			2,805			3,303

1.The prior period amounts have been revised to present Purchases, Proceeds from sales and Proceeds from paydowns and maturities separately between AFS securities and HTM securities.

See Notes to Consolidated Financial Statements			39			September 2022 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. Disclosures reflect the effects of the acquisition of Eaton Vance Corp. (“Eaton Vance”) prospectively from the March 1, 2021 acquisition date. See Note 3 to the financial statements in the 2021 Form 10-K for further information. 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 and other securities, 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 and investment advisory services; self-directed brokerage services; financial and wealth planning services; workplace services, including stock plan administration; annuity and insurance products; 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 2021 Form 10-K. Certain footnote disclosures included in the 2021 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 2021 Form 10-K.

September 2022 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, see Note 2 to the financial statements in the 2021 Form 10-K.

During the nine months ended September 30, 2022 (“current year period”), there were no significant updates to the Firm’s significant accounting policies.

3. Cash and Cash Equivalents

$ in millions			At September 30, 2022			At December 31, 2021
Cash and due from banks			$	6,836		$	8,394
Interest bearing deposits with banks			104,860			119,331
Total Cash and cash equivalents			$	111,696		$	127,725
Restricted cash			$	40,413		$	40,887

For additional information on cash and cash equivalents, including restricted cash, see Note 2 to the financial statements in the 2021 Form 10-K.

4. Fair Values

Recurring Fair Value Measurements    

Assets and Liabilities Measured at Fair Value on a Recurring Basis

			At September 30, 2022
$ in millions			Level 1			Level 2			Level 3			Netting1			Total
Assets at fair value
Trading assets:
U.S. Treasury and agency securities			$	37,694		$	29,822		$	1		$	—		$	67,517
Other sovereign government obligations			27,618			5,411			137			—			33,166
State and municipal securities			—			2,259			52			—			2,311
MABS			—			2,090			344			—			2,434
Loans and lending commitments2			—			4,929			2,583			—			7,512
Corporate and other debt			—			24,936			1,898			—			26,834
Corporate equities3			74,566			1,043			145			—			75,754
Derivative and other contracts:
Interest rate			18,630			173,134			768			—			192,532
Credit			—			10,294			474			—			10,768
Foreign exchange			56			167,919			269			—			168,244
Equity			1,736			59,409			531			—			61,676
Commodity and other			11,660			31,216			4,134			—			47,010
Netting1			(15,435)			(328,762)			(1,363)			(68,420)			(413,980)
Total derivative and other contracts			16,647			113,210			4,813			(68,420)			66,250
Investments4			588			716			873			—			2,177
Physical commodities			—			1,924			—			—			1,924
Total trading assets4			157,113			186,340			10,846			(68,420)			285,879
Investment securities—AFS			53,618			29,979			36			—			83,633
Total assets at fair value			$	210,731		$	216,319		$	10,882		$	(68,420)		$	369,512

			At September 30, 2022
$ in millions			Level 1			Level 2			Level 3			Netting1			Total
Liabilities at fair value
Deposits			$	—		$	3,654		$	7		$	—		$	3,661
Trading liabilities:
U.S. Treasury and agency securities			15,842			8			1			—			15,851
Other sovereign government obligations			19,215			2,398			12			—			21,625
Corporate and other debt			—			9,993			23			—			10,016
Corporate equities3			66,268			564			54			—			66,886
Derivative and other contracts:
Interest rate			16,043			166,207			945			—			183,195
Credit			—			10,079			352			—			10,431
Foreign exchange			57			159,478			94			—			159,629
Equity			1,868			66,950			987			—			69,805
Commodity and other			12,669			24,561			2,333			—			39,563
Netting1			(15,435)			(328,762)			(1,363)			(68,801)			(414,361)
Total derivative and other contracts			15,202			98,513			3,348			(68,801)			48,262
Total trading liabilities			116,527			111,476			3,438			(68,801)			162,640
Securities sold under agreements to repurchase			—			443			508			—			951
Other secured financings			—			4,481			113			—			4,594
Borrowings			—			66,851			1,937			—			68,788
Total liabilities at fair value			$	116,527		$	186,905		$	6,003		$	(68,801)		$	240,634

			At December 31, 2021
$ in millions			Level 1			Level 2			Level 3			Netting1			Total
Assets at fair value
Trading assets:
U.S. Treasury and agency securities			$	45,970		$	29,749		$	2		$	—		$	75,721
Other sovereign government obligations			28,041			4,533			211			—			32,785
State and municipal securities			—			1,905			13			—			1,918
MABS			—			1,237			344			—			1,581
Loans and lending commitments2			—			8,821			3,806			—			12,627
Corporate and other debt			—			27,309			1,973			—			29,282
Corporate equities3			91,630			832			115			—			92,577
Derivative and other contracts:
Interest rate			1,364			153,048			1,153			—			155,565
Credit			—			8,441			509			—			8,950
Foreign exchange			28			74,571			132			—			74,731
Equity			1,562			68,519			251			—			70,332
Commodity and other			4,462			20,194			3,057			—			27,713
Netting1			(5,696)			(241,814)			(794)			(50,833)			(299,137)
Total derivative and other contracts			1,720			82,959			4,308			(50,833)			38,154
Investments4			735			846			1,125			—			2,706
Physical commodities			—			2,771			—			—			2,771
Total trading assets4			168,096			160,962			11,897			(50,833)			290,122
Investment securities—AFS			59,021			43,809			—			—			102,830
Securities purchased under agreements to resell			—			7			—			—			7
Total assets at fair value			$	227,117		$	204,778		$	11,897		$	(50,833)		$	392,959

			41			September 2022 Form 10-Q

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Table of Contents
Notes to Consolidated Financial Statements (Unaudited)

			At December 31, 2021
$ in millions			Level 1			Level 2			Level 3			Netting1			Total
Liabilities at fair value
Deposits			$	—		$	1,873		$	67		$	—		$	1,940
Trading liabilities:
U.S. Treasury and agency securities			16,433			319			—			—			16,752
Other sovereign government obligations			20,771			2,062			—			—			22,833
Corporate and other debt			—			8,707			16			—			8,723
Corporate equities3			75,181			226			45			—			75,452
Derivative and other contracts:
Interest rate			1,087			145,670			445			—			147,202
Credit			—			9,090			411			—			9,501
Foreign exchange			19			73,096			80			—			73,195
Equity			2,119			77,363			1,196			—			80,678
Commodity and other			4,563			16,837			1,528			—			22,928
Netting1			(5,696)			(241,814)			(794)			(50,632)			(298,936)
Total derivative and other contracts			2,092			80,242			2,866			(50,632)			34,568
Total trading liabilities			114,477			91,556			2,927			(50,632)			158,328
Securities sold under agreements to repurchase			—			140			651			—			791
Other secured financings			—			4,730			403			—			5,133
Borrowings			—			74,183			2,157			—			76,340
Total liabilities at fair value			$	114,477		$	172,482		$	6,205		$	(50,632)		$	242,532

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.

Detail of Loans and Lending Commitments at Fair Value

$ in millions			At September 30, 2022			At December 31, 2021
Corporate			$	—		$	8
Secured lending facilities			7			—
Commercial Real Estate			476			863
Residential Real Estate			1,568			3,911
Securities-based lending and Other loans			5,461			7,845
Total			$	7,512		$	12,627

Unsettled Fair Value of Futures Contracts1

$ in millions			At September 30, 2022			At December 31, 2021
Customer and other receivables (payables), net			$	693		$	948

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 5 to the financial statements in the 2021 Form 10-K. During the current quarter, 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 September 30,						Nine Months Ended September 30,
$ in millions			2022			2021			2022			2021
U.S. Treasury and agency securities
Beginning balance			$	9		$	25		$	2		$	9
Realized and unrealized gains (losses)			—			(1)			(1)			—
Purchases			1			4			2			28
Sales			(4)			(24)			(7)			(33)
Net transfers			(5)			—			5			—
Ending balance			$	1		$	4		$	1		$	4
Unrealized gains (losses)			$	—		$	(1)		$	(1)		$	—
Other sovereign government obligations
Beginning balance			$	161		$	78		$	211		$	268
Realized and unrealized gains (losses)			23			(3)			(24)			(1)
Purchases			43			59			69			129
Sales			(57)			(4)			(60)			(269)
Net transfers			(33)			(3)			(59)			—
Ending balance			$	137		$	127		$	137		$	127
Unrealized gains (losses)			$	23		$	(3)		$	(22)		$	—
State and municipal securities
Beginning balance			$	29		$	4		$	13		$	—
Realized and unrealized gains (losses)			(1)			—			(2)			—
Purchases			4			—			54			4
Sales			—			(4)			—			(4)
Net transfers			20			—			(13)			—
Ending balance			$	52		$	—		$	52		$	—
Unrealized gains (losses)			$	(3)		$	—		$	(2)		$	—
MABS
Beginning balance			$	339		$	357		$	344		$	322
Realized and unrealized gains (losses)			8			11			(366)			67
Purchases			3			96			448			263
Sales			(33)			(23)			(116)			(216)
Net transfers			27			(75)			34			(70)
Ending balance			$	344		$	366		$	344		$	366
Unrealized gains (losses)			$	9		$	11		$	(12)		$	8
Loans and lending commitments
Beginning balance			$	2,507		$	4,896		$	3,806		$	5,759
Realized and unrealized gains (losses)			(26)			47			8			33
Purchases and originations			541			1,373			800			2,467
Sales			(353)			(768)			(801)			(2,314)
Settlements			(144)			(414)			(618)			(1,082)
Net transfers1			58			(830)			(612)			(559)
Ending balance			$	2,583		$	4,304		$	2,583		$	4,304
Unrealized gains (losses)			$	(27)		$	21		$	—		$	(5)

September 2022 Form 10-Q			42

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Table of Contents
Notes to Consolidated Financial Statements (Unaudited)

			Three Months Ended September 30,						Nine Months Ended September 30,
$ in millions			2022			2021			2022			2021
Corporate and other debt
Beginning balance			$	2,113		$	1,801		$	1,973		$	3,435
Realized and unrealized gains (losses)			(43)			173			446			(151)
Purchases and originations			132			639			752			1,505
Sales			(528)			(594)			(1,400)			(1,698)
Settlements			(30)			—			(26)			—
Net transfers2			254			(456)			153			(1,528)
Ending balance			$	1,898		$	1,563		$	1,898		$	1,563
Unrealized gains (losses)			$	(42)		$	173		$	454		$	10
Corporate equities
Beginning balance			$	246		$	150		$	115		$	86
Realized and unrealized gains (losses)			(60)			4			(71)			(15)
Purchases			15			83			79			367
Sales			(37)			(7)			(67)			(193)
Net transfers			(19)			(16)			89			(31)
Ending balance			$	145		$	214		$	145		$	214
Unrealized gains (losses)			$	(60)		$	4		$	(65)		$	(5)
Investments
Beginning balance			$	1,027		$	978		$	1,125		$	828
Realized and unrealized gains (losses)			(140)			18			(275)			58
Purchases			6			59			52			150
Sales			(18)			(23)			(33)			(46)
Net transfers			(2)			(251)			4			(209)
Ending balance			$	873		$	781		$	873		$	781
Unrealized gains (losses)			$	(136)		$	13		$	(267)		$	39
Investment securities —AFS
Beginning balance			$	38		$	—		$	—		$	2,804
Realized and unrealized gains (losses)			(2)			—			(2)			(4)
Sales			—			—			—			(203)
Net transfers3			—			—			38			(2,597)
Ending balance			$	36		$	—		$	36		$	—
Unrealized gains (losses)			$	(2)		$	—		$	(2)		$	—
Net derivatives: Interest rate
Beginning balance			$	(102)		$	668		$	708		$	682
Realized and unrealized gains (losses)			(200)			70			(482)			(223)
Purchases			—			22			—			48
Issuances			—			(9)			—			(41)
Settlements			122			18			(38)			101
Net transfers			3			27			(365)			229
Ending balance			$	(177)		$	796		$	(177)		$	796
Unrealized gains (losses)			$	(120)		$	165		$	(201)		$	(168)

			Three Months Ended September 30,						Nine Months Ended September 30,
$ in millions			2022			2021			2022			2021
Net derivatives: Credit
Beginning balance			$	190		$	(203)		$	98		$	49
Realized and unrealized gains (losses)			3			59			91			(2)
Purchases			—			12			3			23
Issuances			—			(19)			(1)			(44)
Settlements			(78)			102			(59)			16
Net transfers			7			15			(10)			(76)
Ending balance			$	122		$	(34)		$	122		$	(34)
Unrealized gains (losses)			$	7		$	(26)		$	83		$	—
Net derivatives: Foreign exchange
Beginning balance			$	(331)		$	33		$	52		$	61
Realized and unrealized gains (losses)			38			32			(18)			41
Purchases			—			12			—			19
Issuances			—			(15)			—			(21)
Settlements			73			46			47			(45)
Net transfers			395			(11)			94			42
Ending balance			$	175		$	97		$	175		$	97
Unrealized gains (losses)			$	44		$	29		$	18		$	73
Net derivatives: Equity
Beginning balance			$	(530)		$	(837)		$	(945)		$	(2,231)
Realized and unrealized gains (losses)			1			(45)			275			366
Purchases			48			24			167			69
Issuances			(92)			(122)			(253)			(362)
Settlements			68			(3)			379			(196)
Net transfers2			49			(17)			(79)			1,354
Ending balance			$	(456)		$	(1,000)		$	(456)		$	(1,000)
Unrealized gains (losses)			$	(3)		$	(96)		$	399		$	(57)
Net derivatives: Commodity and other
Beginning balance			$	1,344		$	1,430		$	1,529		$	1,709
Realized and unrealized gains (losses)			238			(167)			546			43
Purchases			2			44			107			324
Issuances			(7)			(31)			(97)			(137)
Settlements			69			(97)			(247)			(371)
Net transfers			155			130			(37)			(259)
Ending balance			$	1,801		$	1,309		$	1,801		$	1,309
Unrealized gains (losses)			$	72		$	(96)		$	25		$	(243)
Deposits
Beginning balance			$	19		$	86		$	67		$	126
Realized and unrealized losses (gains)			—			(1)			—			1
Issuances			2			—			2			—
Settlements			(1)			(4)			(3)			(12)
Net transfers			(13)			(19)			(59)			(53)
Ending balance			$	7		$	62		$	7		$	62
Unrealized losses (gains)			$	—		$	(1)		$	—		$	1
Nonderivative trading liabilities
Beginning balance			$	104		$	59		$	61		$	79
Realized and unrealized losses (gains)			(8)			(11)			(41)			(20)
Purchases			(20)			(16)			(39)			(88)
Sales			16			11			88			83
Net transfers			(2)			(1)			21			(12)
Ending balance			$	90		$	42		$	90		$	42
Unrealized losses (gains)			$	(8)		$	(11)		$	(41)		$	1

			43			September 2022 Form 10-Q

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Table of Contents
Notes to Consolidated Financial Statements (Unaudited)

			Three Months Ended September 30,						Nine Months Ended September 30,
$ in millions			2022			2021			2022			2021
Securities sold under agreements to repurchase
Beginning balance			$	514		$	449		$	651		$	444
Realized and unrealized losses (gains)			5			(1)			(3)			5
Issuances			—			—			9			—
Settlements			(11)			—			(22)			—
Net transfers			—			—			(127)			(1)
Ending balance			$	508		$	448		$	508		$	448
Unrealized losses (gains)			$	5		$	(1)		$	—		$	5
Other secured financings
Beginning balance			$	112		$	401		$	403		$	516
Realized and unrealized losses (gains)			(5)			(17)			(11)			(14)
Issuances			13			14			44			421
Settlements			(7)			(3)			(320)			(500)
Net transfers			—			—			(3)			(28)
Ending balance			$	113		$	395		$	113		$	395
Unrealized losses (gains)			$	(5)		$	(17)		$	(11)		$	(13)
Borrowings
Beginning balance			$	2,325		$	1,975		$	2,157		$	4,374
Realized and unrealized losses (gains)			(185)			(87)			(625)			(37)
Issuances			65			197			230			411
Settlements			(65)			(67)			(263)			(347)
Net transfers2			(203)			38			438			(2,345)
Ending balance			$	1,937		$	2,056		$	1,937		$	2,056
Unrealized losses (gains)			$	(185)		$	(86)		$	(629)		$	(8)
Portion of Unrealized losses (gains) recorded in OCI—Change in net DVA			(36)			(4)			(126)			(18)

1.Net transfers in the prior year quarter reflect the transfer of $895 million of equity margin loans from Level 3 to Level 2 as a result of the reduced significance of the margin loan rate input.

2.Net transfers in the prior year period reflect the transfer in the second quarter of the prior year of $2.0 billion of Corporate and Other Debt, $1.0 billion of net Equity derivatives, and $2.2 billion of Borrowings from Level 3 to Level 2 as the unobservable inputs were not significant to the overall fair value measurements.

3.Net transfers in the prior year period reflect the transfer in the first quarter of the prior year of $2.5 billion of AFS securities from Level 3 to Level 2 due to increased trading activity and observability of pricing inputs.

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.

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 September 30, 2022			At December 31, 2021
Assets at Fair Value on a Recurring Basis
Other sovereign government obligations			$	137		$	211
Comparable pricing:
Bond price			76 to 127 points (92 points)			100 to 140 points (120 points)
State and municipal securities			$	52		$	13
Comparable pricing:
Bond price			78 to 100 points (95 points)			N/M
MABS			$	344		$	344
Comparable pricing:
Bond price			0 to 95 points (68 points)			0 to 86 points (59 points)
Loans and lending commitments			$	2,583		$	3,806
Margin loan model:
Margin loan rate			2% to 4% (3%)			1% to 4% (3%)
Comparable pricing:
Loan price			84 to 101 points (97 points)			89 to 101 points (97 points)
Corporate and other debt			$	1,898		$	1,973
Comparable pricing:
Bond price			52 to 139 points (90 points)			50 to 163 points (99 points)
Discounted cash flow:
Loss given default			54% to 84% (62% / 54%)			54% to 84% (62% / 54%)
Corporate equities			$	145		$	115
Comparable pricing:
Equity price			100%			100%
Investments			$	873		$	1,125
Discounted cash flow:
WACC			15% to 18% (17%)			10% to 16% (15%)
Exit multiple			7 to 17 times (13 times)			8 to 17 times (12 times)
Market approach:
EBITDA multiple			7 to 20 times (9 times)			8 to 25 times (10 times)
Comparable pricing:
Equity price			48% to 100% (85%)			43% to 100% (99%)

September 2022 Form 10-Q			44

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Table of Contents
Notes to Consolidated Financial Statements (Unaudited)

			Balance / Range (Average1)
$ in millions, except inputs			At September 30, 2022			At December 31, 2021
Net derivative and other contracts:
Interest rate			$	(177)		$	708
Option model:
IR volatility skew			106% to 126% (113% / 111%)			39% to 79% (64% / 63%)
IR curve correlation			58% to 99% (80% / 80%)			62% to 98% (83% / 84%)
Bond volatility			N/M			5% to 32% (12% / 9%)
Inflation volatility			24% to 62% (44% / 40%)			24% to 65% (44% / 40%)
IR curve			4% to 5% (4% / 4%)			4%
Credit			$	122		$	98
Credit default swap model:
Cash-synthetic basis			7 points			7 points
Bond price			0 to 83 points (43 points)			0 to 83 points (46 points)
Credit spread			10 to 530 bps (129 bps)			14 to 477 bps (68 bps)
Funding spread			18 to 590 bps (86 bps)			15 to 433 bps (55 bps)
Foreign exchange2			$	175		$	52
Option model:
IR - FX correlation			N/M			53% to 56% (55% / 54%)
IR volatility skew			N/M			39% to 79% (64% / 63%)
IR curve			-4% to 71% (21% / 17%)			-1% to 7% (2% / 0%)
Foreign exchange volatility skew			11% to 15% (13% / 13%)			-4% to -2% (-3% / -3%)
Contingency probability			95%			90% to 95% (94% / 95%)
Equity2			$	(456)		$	(945)
Option model:
Equity volatility			5% to 97% (27%)			5% to 99% (24%)
Equity volatility skew			-3% to 0% (-1%)			-4% to 0% (-1%)
Equity correlation			10% to 96% (76%)			5% to 99% (73%)
FX correlation			-85% to 65% (-27%)			-85% to 37% (-42%)
IR correlation			10% to 30% (12%)			13% to 30% (15%)
Commodity and other			$	1,801		$	1,529
Option model:
Forward power price			$2 to $288 ($59) per MWh			$4 to $263 ($39) per MWh
Commodity volatility			8% to 137% (36%)			8% to 385% (22%)
Cross-commodity correlation			70% to 100% (93%)			43% to 100% (94%)
Liabilities Measured at Fair Value on a Recurring Basis
Deposits			$	7		$	67
Option model:
Equity volatility			N/M			7%
Nonderivative trading liabilities —Corporate equities			$	54		$	45
Comparable pricing:
Equity price			100%			100%
Securities sold under agreements to repurchase			$	508		$	651
Discounted cash flow:
Funding spread			62 to 147 bps (114 bps)			112 to 127 bps (120 bps)
Other secured financings			$	113		$	403
Comparable pricing:
Loan price			23 to 101 points (77 points)			30 to 100 points (83 points)

			Balance / Range (Average1)
$ in millions, except inputs			At September 30, 2022			At December 31, 2021
Borrowings			$	1,937		$	2,157
Option model:
Equity volatility			6% to 96% (23%)			7% to 85% (20%)
Equity volatility skew			-1% to 0% (-1%)			-1% to 0% (0%)
Equity correlation			39% to 95% (86%)			41% to 95% (81%)
Equity - FX correlation			-55% to 25% (-17%)			-55% to 25% (-30%)
IR FX Correlation			-17% to 5% (-5% / -5%)			-26% to 8% (-5% / -5%)
IR curve correlation			58% to 85% (75% / 73%)			N/M
IR volatility skew			57% to 93% (69% / 56%)			N/M
Discounted cash flow:
Loss given default			54% to 84% (62% / 54%)			54% to 84% (62% / 54%)
Nonrecurring Fair Value Measurement
Loans			$	3,476		$	1,576
Corporate loan model:
Credit spread			113 to 819 bps (438 bps)			108 to 565 bps (284 bps)
Comparable pricing:
Loan price			36 to 80 points (66 points)			40 to 80 points (61 points)
Warehouse model:
Credit spread			146 to 260 bps (235 bps)			182 to 446 bps (376 bps)

Points—Percentage of par

IR—Interest rate

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 5 to the financial statements in the 2021 Form 10-K. During the current quarter, there were no significant revisions made to the descriptions of the Firm’s significant unobservable inputs.

			45			September 2022 Form 10-Q

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Table of Contents
Notes to Consolidated Financial Statements (Unaudited)

Net Asset Value Measurements

Fund Interests

			At September 30, 2022						At December 31, 2021
$ in millions			Carrying Value			Commitment			Carrying Value			Commitment
Private equity			$	2,795		$	538		$	2,492		$	615
Real estate			2,316			242			2,064			248
Hedge1			198			2			191			2
Total			$	5,309		$	782		$	4,747		$	865

1.Investments in hedge funds may be subject to initial period lock-up or gate provisions, which restrict an investor from withdrawing from the fund during a certain initial period or restrict the redemption amount on any redemption date, respectively.

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 5 to the financial statements in the 2021 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 September 30, 2022
$ in millions			Private Equity			Real Estate
Less than 5 years			$	1,035		$	902
5-10 years			1,196			1,380
Over 10 years			564			34
Total			$	2,795		$	2,316

Nonrecurring Fair Value Measurements

Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis

			At September 30, 2022
			Fair Value
$ in millions			Level 2			Level 31			Total
Assets
Loans			$	4,855		$	3,476		$	8,331
Other assets—Other investments			—			5			5
Other assets—ROU assets			5			—			5
Total			$	4,860		$	3,481		$	8,341
Liabilities
Other liabilities and accrued expenses—Lending commitments			$	375		$	144		$	519
Total			$	375		$	144		$	519

			At December 31, 2021
			Fair Value
$ in millions			Level 2			Level 31			Total
Assets
Loans			$	4,035		$	1,576		$	5,611
Other assets—Other investments			—			8			8
Other assets—ROU assets			16			—			16
Total			$	4,051		$	1,584		$	5,635
Liabilities
Other liabilities and accrued expenses—Lending commitments			$	173		$	70		$	243
Total			$	173		$	70		$	243

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 September 30,						Nine Months Ended September 30,
$ in millions			2022			2021			2022			2021
Assets
Loans2			$	(118)		$	(22)		$	(365)		$	(75)
Goodwill			—			—			—			(8)
Intangibles			—			—			—			(3)
Other assets—Other investments3			(2)			(2)			(8)			(55)
Other assets—Premises, equipment and software			(1)			(10)			(3)			(14)
Other assets—ROU assets			(1)			—			(7)			—
Total			$	(122)		$	(34)		$	(383)		$	(155)
Liabilities
Other liabilities and accrued expenses—Lending commitments2			$	(13)		$	(2)		$	(172)		$	34
Total			$	(13)		$	(2)		$	(172)		$	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—Other investments were determined using techniques that included discounted cash flow models, methodologies that incorporate multiples of certain comparable companies and recently executed transactions.

September 2022 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 September 30, 2022
			Carrying Value			Fair Value
$ in millions						Level 1			Level 2			Level 3			Total
Financial assets
Cash and cash equivalents			$	111,696		$	111,696		$	—		$	—		$	111,696
Investment securities—HTM			77,636			27,657			37,721			1,015			66,393
Securities purchased under agreements to resell			111,124			—			108,312			2,680			110,992
Securities borrowed			136,478			—			136,471			—			136,471
Customer and other receivables			83,417			—			79,493			3,558			83,051
Loans1			210,936			—			25,100			178,571			203,671
Other assets			704			—			704			—			704
Financial liabilities
Deposits			$	334,462		$	—		$	334,378		$	—		$	334,378
Securities sold under agreements to repurchase			59,182			—			59,070			—			59,070
Securities loaned			13,097			—			13,096			—			13,096
Other secured financings			3,107			—			3,107			—			3,107
Customer and other payables			229,272			—			229,272			—			229,272
Borrowings			151,635			—			148,105			4			148,109
			Commitment Amount
Lending commitments2			$	135,899		$	—		$	2,065		$	880		$	2,945

			At December 31, 2021
			Carrying Value			Fair Value
$ in millions						Level 1			Level 2			Level 3			Total
Financial assets
Cash and cash equivalents			$	127,725		$	127,725		$	—		$	—		$	127,725
Investment securities—HTM			80,168			29,454			49,352			1,076			79,882
Securities purchased under agreements to resell			119,992			—			117,922			2,075			119,997
Securities borrowed			129,713			—			129,713			—			129,713
Customer and other receivables			91,664			—			88,091			3,442			91,533
Loans1			188,134			—			25,706			163,784			189,490
Other assets			528			—			528			—			528
Financial liabilities
Deposits			$	345,634		$	—		$	345,911		$	—		$	345,911
Securities sold under agreements to repurchase			61,397			—			61,419			—			61,419
Securities loaned			12,299			—			12,296			—			12,296
Other secured financings			4,908			—			4,910			—			4,910
Customer and other payables			228,631			—			228,631			—			228,631
Borrowings			156,787			—			162,154			4			162,158
			Commitment Amount
Lending commitments2			$	133,519		$	—		$	890		$	470		$	1,360

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

2.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 September 30, 2022			At December 31, 2021
Business Unit Responsible for Risk Management
Equity			$	34,226		$	37,046
Interest rates			22,896			28,638
Commodities			9,147			7,837
Credit			1,220			1,347
Foreign exchange			1,299			1,472
Total			$	68,788		$	76,340

Net Revenues from Borrowings under the Fair Value Option

			Three Months Ended September 30,						Nine Months Ended September 30,
$ in millions			2022			2021			2022			2021
Trading revenues			$	4,034		$	1,383		$	16,361		$	937
Interest expense			67			77			203			234
Net revenues1			$	3,967		$	1,306		$	16,158		$	703

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 September 30,
			2022						2021
$ in millions			Trading Revenues			OCI			Trading Revenues			OCI
Loans and other receivables1			$	(68)		$	—		$	58		$	—
Lending commitments			(2)			—			(3)			—
Deposits			—			(9)			—			6
Borrowings			—			1,091			(9)			190

			Nine Months Ended September 30,
			2022						2021
$ in millions			Trading Revenues			OCI			Trading Revenues			OCI
Loans and other receivables1			$	(59)		$	—		$	311		$	—
Lending commitments			(3)			—			(2)			—
Deposits			—			5			—			15
Borrowings			1			3,468			(36)			612

			47			September 2022 Form 10-Q

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Table of Contents
Notes to Consolidated Financial Statements (Unaudited)

$ in millions			At September 30, 2022			At December 31, 2021
Cumulative pre-tax DVA gain (loss) recognized in AOCI			$	1,034		$	(2,439)

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 September 30, 2022			At December 31, 2021
Loans and other receivables2			$	10,908		$	12,633
Nonaccrual loans2			8,192			9,999
Borrowings3			5,558			(2,106)

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 September 30, 2022			At December 31, 2021
Nonaccrual loans			$	440		$	989
Nonaccrual loans 90 or more days past due			41			363

6. Derivative Instruments and Hedging Activities

Fair Values of Derivative Contracts

			Assets at September 30, 2022
$ in millions			Bilateral OTC			Cleared OTC			Exchange- Traded			Total
Designated as accounting hedges
Interest rate			$	53		$	1		$	—		$	54
Foreign exchange			332			137			—			469
Total			385			138			—			523
Not designated as accounting hedges
Economic hedges of loans
Credit			2			112			—			114
Other derivatives
Interest rate			158,740			31,664			2,074			192,478
Credit			7,627			3,027			—			10,654
Foreign exchange			163,229			4,476			70			167,775
Equity			25,922			—			35,754			61,676
Commodity and other			33,833			—			13,177			47,010
Total			389,353			39,279			51,075			479,707
Total gross derivatives			$	389,738		$	39,417		$	51,075		$	480,230
Amounts offset
Counterparty netting			(270,565)			(37,449)			(48,859)			(356,873)
Cash collateral netting			(55,266)			(1,841)			—			(57,107)
Total in Trading assets			$	63,907		$	127		$	2,216		$	66,250
Amounts not offset1
Financial instruments collateral			(28,876)			—			—			(28,876)
Net amounts			$	35,031		$	127		$	2,216		$	37,374
Net amounts for which master netting or collateral agreements are not in place or may not be legally enforceable												$	8,565

			Liabilities at September 30, 2022
$ in millions			Bilateral OTC			Cleared OTC			Exchange- Traded			Total
Designated as accounting hedges
Interest rate			$	427		$	1		$	—		$	428
Foreign exchange			56			3			—			59
Total			483			4			—			487
Not designated as accounting hedges
Economic hedges of loans
Credit			8			231			—			239
Other derivatives
Interest rate			147,347			34,480			940			182,767
Credit			7,057			3,135			—			10,192
Foreign exchange			155,524			3,971			75			159,570
Equity			31,341			—			38,464			69,805
Commodity and other			25,455			—			14,108			39,563
Total			366,732			41,817			53,587			462,136
Total gross derivatives			$	367,215		$	41,821		$	53,587		$	462,623
Amounts offset
Counterparty netting			(270,565)			(37,449)			(48,859)			(356,873)
Cash collateral netting			(56,300)			(1,188)			—			(57,488)
Total in Trading liabilities			$	40,350		$	3,184		$	4,728		$	48,262
Amounts not offset1
Financial instruments collateral			(2,927)			—			(2,899)			(5,826)
Net amounts			$	37,423		$	3,184		$	1,829		$	42,436
Net amounts for which master netting or collateral agreements are not in place or may not be legally enforceable												8,279

			48			September 2022 Form 10-Q

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Table of Contents
Notes to Consolidated Financial Statements (Unaudited)

			Assets at December 31, 2021
$ in millions			Bilateral OTC			Cleared OTC			Exchange- Traded			Total
Designated as accounting hedges
Interest rate			$	594		$	1		$	—		$	595
Foreign exchange			191			6			—			197
Total			785			7			—			792
Not designated as accounting hedges
Economic hedges of loans
Credit			—			15			—			15
Other derivatives
Interest rate			147,585			7,002			383			154,970
Credit			5,749			3,186			—			8,935
Foreign exchange			73,276			1,219			39			74,534
Equity			28,877			—			41,455			70,332
Commodity and other			22,175			—			5,538			27,713
Total			277,662			11,422			47,415			336,499
Total gross derivatives			$	278,447		$	11,429		$	47,415		$	337,291
Amounts offset
Counterparty netting			(201,729)			(9,818)			(42,883)			(254,430)
Cash collateral netting			(43,495)			(1,212)			—			(44,707)
Total in Trading assets			$	33,223		$	399		$	4,532		$	38,154
Amounts not offset1
Financial instruments collateral			(10,457)			—			—			(10,457)
Net amounts			$	22,766		$	399		$	4,532		$	27,697
Net amounts for which master netting or collateral agreements are not in place or may not be legally enforceable												$	6,725

			Liabilities at December 31, 2021
$ in millions			Bilateral OTC			Cleared OTC			Exchange- Traded			Total
Designated as accounting hedges
Interest rate			$	86		$	1		$	—		$	87
Foreign exchange			57			50			—			107
Total			143			51			—			194
Not designated as accounting hedges
Economic hedges of loans
Credit			17			412			—			429
Other derivatives
Interest rate			140,770			6,112			233			147,115
Credit			5,609			3,463			—			9,072
Foreign exchange			71,851			1,196			41			73,088
Equity			39,597			—			41,081			80,678
Commodity and other			17,188			—			5,740			22,928
Total			275,032			11,183			47,095			333,310
Total gross derivatives			$	275,175		$	11,234		$	47,095		$	333,504
Amounts offset
Counterparty netting			(201,729)			(9,818)			(42,883)			(254,430)
Cash collateral netting			(43,305)			(1,201)			—			(44,506)
Total in Trading liabilities			$	30,141		$	215		$	4,212		$	34,568
Amounts not offset1
Financial instruments collateral			(5,866)			(8)			(39)			(5,913)
Net amounts			$	24,275		$	207		$	4,173		$	28,655
Net amounts for which master netting or collateral agreements are not in place or may not be legally enforceable												$	6,194

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 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 September 30, 2022
$ in billions			Bilateral OTC			Cleared OTC			Exchange- Traded			Total
Designated as accounting hedges
Interest rate			$	2		$	49		$	—		$	51
Foreign exchange			9			3			—			12
Total			11			52			—			63
Not designated as accounting hedges
Economic hedges of loans
Credit			—			5			—			5
Other derivatives
Interest rate			3,320			7,486			616			11,422
Credit			207			129			—			336
Foreign exchange			3,600			147			9			3,756
Equity			504			—			423			927
Commodity and other			155			—			73			228
Total			7,786			7,767			1,121			16,674
Total gross derivatives			$	7,797		$	7,819		$	1,121		$	16,737

			Liabilities at September 30, 2022
$ in billions			Bilateral OTC			Cleared OTC			Exchange- Traded			Total
Designated as accounting hedges
Interest rate			$	3		$	186		$	—		$	189
Foreign exchange			3			—			—			3
Total			6			186			—			192
Not designated as accounting hedges
Economic hedges of loans
Credit			—			11			—			11
Other derivatives
Interest rate			3,430			7,979			532			11,941
Credit			194			131			—			325
Foreign exchange			3,513			141			29			3,683
Equity			503			—			603			1,106
Commodity and other			113			—			93			206
Total			7,753			8,262			1,257			17,272
Total gross derivatives			$	7,759		$	8,448		$	1,257		$	17,464

			Assets at December 31, 2021
$ in billions			Bilateral OTC			Cleared OTC			Exchange- Traded			Total
Designated as accounting hedges
Interest rate			$	4		$	104		$	—		$	108
Foreign exchange			8			1			—			9
Total			12			105			—			117
Not designated as accounting hedges
Economic hedges of loans
Credit			—			—			—			—
Other derivatives
Interest rate			3,488			7,082			570			11,140
Credit			216			105			—			321
Foreign exchange			3,386			95			10			3,491
Equity			495			—			407			902
Commodity and other			139			—			73			212
Total			7,724			7,282			1,060			16,066
Total gross derivatives			$	7,736		$	7,387		$	1,060		$	16,183

			49			September 2022 Form 10-Q

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Notes to Consolidated Financial Statements (Unaudited)

			Liabilities at December 31, 2021
$ in billions			Bilateral OTC			Cleared OTC			Exchange- Traded			Total
Designated as accounting hedges
Interest rate			$	—		$	99		$	—		$	99
Foreign exchange			5			3			—			8
Total			5			102			—			107
Not designated as accounting hedges
Economic hedges of loans
Credit			1			12			—			13
Other derivatives
Interest rate			3,827			6,965			445			11,237
Credit			225			106			—			331
Foreign exchange			3,360			88			12			3,460
Equity			552			—			735			1,287
Commodity and other			110			—			81			191
Total			8,075			7,171			1,273			16,519
Total gross derivatives			$	8,080		$	7,273		$	1,273		$	16,626

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 7 to the financial statements in the 2021 Form 10-K.

Gains (Losses) on Accounting Hedges

			Three Months Ended						Nine Months Ended
			September 30,						September 30,
$ in millions			2022			2021			2022			2021
Fair value hedges—Recognized in Interest income
Interest rate contracts			$	846		$	107		$	2,037		$	607
Investment Securities—AFS			(836)			(82)			(1,960)			(509)
Fair value hedges—Recognized in Interest expense
Interest rate contracts			$	(5,379)		$	(763)		$	(15,629)		$	(3,633)
Deposits			25			15			143			73
Borrowings			5,372			796			15,499			3,547
Net investment hedges—Foreign exchange contracts
Recognized in OCI			$	662		$	225		$	1,436		$	524
Forward points excluded from hedge effectiveness testing—Recognized in Interest income			18			(19)			(59)			(32)

Fair Value Hedges—Hedged Items 

$ in millions			At September 30, 2022			At December 31, 2021
Investment Securities—AFS
Amortized cost basis currently or previously hedged			$	26,017		$	17,902
Basis adjustments included in amortized cost1			$	(1,847)		$	(591)
Deposits
Carrying amount currently or previously hedged			$	4,319		$	6,279
Basis adjustments included in carrying amount1			$	(138)		$	5
Borrowings
Carrying amount currently or previously hedged			$	135,864		$	122,919
Basis adjustments included in carrying amount—Outstanding hedges			$	(13,052)		$	2,324
Basis adjustments included in carrying amount—Terminated hedges			$	(722)		$	(743)

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

Gains (Losses) on Economic Hedges of Loans

			Three Months Ended						Nine Months Ended
			September 30,						September 30,
$ in millions			2022			2021			2022			2021
Recognized in Other revenues
Credit contracts1			$	(44)		$	(21)		$	160		$	(170)

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

Net Derivative Liabilities and Collateral Posted

$ in millions			At September 30, 2022			At December 31, 2021
Net derivative liabilities with credit risk-related contingent features			$	23,750		$	20,548
Collateral posted			14,427			14,789

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 September 30, 2022
One-notch downgrade			$	779
Two-notch downgrade			491
Bilateral downgrade agreements included in the amounts above1			$	1,215

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 either or both of Moody’s Investors Service, Inc. and S&P Global Ratings. 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

September 2022 Form 10-Q			50

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Notes to Consolidated Financial Statements (Unaudited)

event of one-notch or two-notch downgrade scenarios based on the relevant contractual downgrade triggers.

Maximum Potential Payout/Notional of Credit Protection Sold1

			Years to Maturity at September 30, 2022
$ in billions			< 1			1-3			3-5			Over 5			Total
Single-name CDS
Investment grade			$	11		$	28		$	27		$	13		$	79
Non-investment grade			5			12			16			5			38
Total			$	16		$	40		$	43		$	18		$	117
Index and basket CDS
Investment grade			$	2		$	11		$	70		$	44		$	127
Non-investment grade			8			17			39			20			84
Total			$	10		$	28		$	109		$	64		$	211
Total CDS sold			$	26		$	68		$	152		$	82		$	328
Other credit contracts			—			—			—			—			—
Total credit protection sold			$	26		$	68		$	152		$	82		$	328
CDS protection sold with identical protection purchased															$	273

			Years to Maturity at December 31, 2021
$ in billions			< 1			1-3			3-5			Over 5			Total
Single-name CDS
Investment grade			$	10		$	26		$	29		$	9		$	74
Non-investment grade			5			13			17			2			37
Total			$	15		$	39		$	46		$	11		$	111
Index and basket CDS
Investment grade			$	2		$	11		$	106		$	15		$	134
Non-investment grade			9			14			37			12			72
Total			$	11		$	25		$	143		$	27		$	206
Total CDS sold			$	26		$	64		$	189		$	38		$	317
Other credit contracts			—			—			—			—			—
Total credit protection sold			$	26		$	64		$	189		$	38		$	317
CDS protection sold with identical protection purchased															$	278

Fair Value Asset (Liability) of Credit Protection Sold1

$ in millions			At September 30, 2022			At December 31, 2021
Single-name CDS
Investment grade			$	145		$	1,428
Non-investment grade			(1,886)			(370)
Total			$	(1,741)		$	1,058
Index and basket CDS
Investment grade			$	(194)		$	1,393
Non-investment grade			(4,125)			(650)
Total			$	(4,319)		$	743
Total CDS sold			$	(6,060)		$	1,801
Other credit contracts			(2)			(3)
Total credit protection sold			$	(6,062)		$	1,798

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 September 30, 2022			At December 31, 2021
Single name			$	139		$	126
Index and basket			184			204
Tranched index and basket			26			18
Total			$	349		$	348

			Fair Value Asset (Liability)
$ in millions			At September 30, 2022			At December 31, 2021
Single name			$	1,970		$	(1,338)
Index and basket			3,986			(563)
Tranched index and basket			441			(451)
Total			$	6,397		$	(2,352)

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 7 to the financial statements in the 2021 Form 10-K.

7. Investment Securities

AFS and HTM Securities

			At September 30, 2022
$ in millions			Amortized Cost1			Gross Unrealized Gains			Gross Unrealized Losses			Fair  Value
AFS securities
U.S. Treasury securities			$	56,113		$	9		$	2,504		$	53,618
U.S. agency securities2			23,918			1			2,879			21,040
Agency CMBS			6,144			3			449			5,698
State and municipal securities			2,170			14			90			2,094
FFELP student loan ABS3			1,213			—			30			1,183
Total AFS securities			89,558			27			5,952			83,633
HTM securities
U.S. Treasury securities			29,589			—			1,932			27,657
U.S. agency securities2			44,945			—			9,006			35,939
Agency CMBS			1,954			—			172			1,782
Non-agency CMBS			1,148			—			133			1,015
Total HTM securities			77,636			—			11,243			66,393
Total investment securities			$	167,194		$	27		$	17,195		$	150,026

			51			September 2022 Form 10-Q

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Notes to Consolidated Financial Statements (Unaudited)

			At December 31, 2021
$ in millions			Amortized Cost1			Gross Unrealized Gains			Gross Unrealized Losses			Fair  Value
AFS securities
U.S. Treasury securities			$	58,974		$	343		$	296		$	59,021
U.S. agency securities2			26,780			274			241			26,813
Agency CMBS			14,476			289			89			14,676
State and municipal securities			613			37			2			648
FFELP student loan ABS3			1,672			11			11			1,672
Total AFS securities			102,515			954			639			102,830
HTM securities
U.S. Treasury securities			28,653			882			81			29,454
U.S. agency securities2			48,195			169			1,228			47,136
Agency CMBS			2,267			—			51			2,216
Non-agency CMBS			1,053			28			5			1,076
Total HTM securities			80,168			1,079			1,365			79,882
Total investment securities			$	182,683		$	2,033		$	2,004		$	182,712

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 September 30, 2022						At December 31, 2021
$ in millions			Fair Value			Gross Unrealized Losses			Fair Value			Gross Unrealized Losses
U.S. Treasury securities
Less than 12 months			$	46,061		$	1,923		$	31,459		$	296
12 months or longer			6,673			581			—			—
Total			52,734			2,504			31,459			296
U.S. agency securities
Less than 12 months			15,301			1,602			12,283			219
12 months or longer			5,708			1,277			1,167			22
Total			21,009			2,879			13,450			241
Agency CMBS
Less than 12 months			5,373			437			2,872			89
12 months or longer			104			12			10			—
Total			5,477			449			2,882			89
State and municipal securities
Less than 12 months			1,536			88			21			2
12 months or longer			46			2			7			—
Total			1,582			90			28			2
FFELP student loan ABS
Less than 12 months			807			19			320			1
12 months or longer			348			11			591			10
Total			1,155			30			911			11
Total AFS securities in an unrealized loss position
Less than 12 months			69,078			4,069			46,955			607
12 months or longer			12,879			1,883			1,775			32
Total			$	81,957		$	5,952		$	48,730		$	639

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 2021 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 September 30, 2022 and December 31, 2021, the securities in an unrealized loss position are predominantly investment grade.

The HTM securities net carrying amounts at September 30, 2022 and December 31, 2021 reflect an ACL of $30 million and $33 million, respectively, related to Non-agency CMBS. See Note 2 in the 2021 Form 10-K for a description of the ACL methodology used for HTM Securities. As of September 30, 2022, and December 31, 2021, 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 September 30, 2022
$ in millions			Amortized Cost1			Fair Value			Annualized Average Yield2
AFS securities
U.S. Treasury securities:
Due within 1 year			$	12,692		$	12,438		1.1		%
After 1 year through 5 years			40,430			38,199			1.2		%
After 5 years through 10 years			2,991			2,981			1.1		%
Total			56,113			53,618
U.S. agency securities:
Due within 1 year			4			5			0.9		%
After 1 year through 5 years			415			382			1.4		%
After 5 years through 10 years			919			831			1.8		%
After 10 years			22,580			19,822			1.7		%
Total			23,918			21,040
Agency CMBS:
Due within 1 year			119			118			1.8		%
After 1 year through 5 years			854			783			2.1		%
After 5 years through 10 years			3,856			3,680			1.8		%
After 10 years			1,315			1,117			1.2		%
Total			6,144			5,698
State and municipal securities:
Due within 1 year			33			34			2.5		%
After 1 year through 5 years			28			29			2.6		%
After 5 years through 10 years			65			62			2.6		%
After 10 Years			2,044			1,969			3.2		%
Total			2,170			2,094
FFELP student loan ABS:
After 1 year through 5 years			122			118			0.9		%
After 5 years through 10 years			129			124			0.7		%
After 10 years			962			941			1.6		%
Total			1,213			1,183
Total AFS securities			89,558			83,633			1.4		%

September 2022 Form 10-Q			52

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Notes to Consolidated Financial Statements (Unaudited)

			At September 30, 2022
$ in millions			Amortized Cost1			Fair Value			Annualized Average Yield2
HTM securities
U.S. Treasury securities:
Due within 1 year			3,429			3,397			1.9		%
After 1 year through 5 years			20,732			19,573			1.8		%
After 5 years through 10 years			3,867			3,515			2.4		%
After 10 years			1,561			1,172			2.3		%
Total			29,589			27,657
U.S. agency securities:
After 5 years through 10 years			399			362			2.1		%
After 10 years			44,546			35,577			1.8		%
Total			44,945			35,939
Agency CMBS:
Due within 1 year			60			59			1.0		%
After 1 year through 5 years			1,528			1,418			1.3		%
After 5 years through 10 years			226			192			1.5		%
After 10 years			140			113			1.5		%
Total			1,954			1,782
Non-agency CMBS:
Due within 1 year			173			172			4.0		%
After 1 year through 5 years			206			191			3.9		%
After 5 years through 10 years			718			607			3.7		%
After 10 years			51			45			3.7		%
Total			1,148			1,015
Total HTM securities			77,636			66,393			1.9		%
Total investment securities			167,194			150,026			1.6		%

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 considers the contractual coupon, amortization of premiums and accretion of discounts, and the effect of related hedging derivatives.

Gross Realized Gains (Losses) on Sales of AFS Securities

			Three Months Ended September 30,						Nine Months Ended September 30,
$ in millions			2022			2021			2022			2021
Gross realized gains			$	13		$	17		$	163		$	236
Gross realized (losses)			(4)			—			(92)			(27)
Total1			$	9		$	17		$	71		$	209

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

8. Collateralized Transactions

Offsetting of Certain Collateralized Transactions

			At September 30, 2022
$ in millions			Gross Amounts			Amounts Offset			Balance Sheet Net Amounts			Amounts Not Offset1			Net Amounts
Assets
Securities purchased under agreements to resell			$	207,180		$	(96,056)		$	111,124		$	(106,215)		$	4,909
Securities borrowed			148,654			(12,176)			136,478			(130,579)			5,899
Liabilities
Securities sold under agreements to repurchase			$	156,189		$	(96,056)		$	60,133		$	(55,748)		$	4,385
Securities loaned			25,273			(12,176)			13,097			(12,664)			433
Net amounts for which master netting agreements are not in place or may not be legally enforceable
Securities purchased under agreements to resell															$	2,773
Securities borrowed															820
Securities sold under agreements to repurchase															3,162
Securities loaned															262

			At December 31, 2021
$ in millions			Gross Amounts			Amounts Offset			Balance Sheet Net Amounts			Amounts Not Offset1			Net Amounts
Assets
Securities purchased under agreements to resell			$	197,486		$	(77,487)		$	119,999		$	(106,896)		$	13,103
Securities borrowed			139,395			(9,682)			129,713			(124,028)			5,685
Liabilities
Securities sold under agreements to repurchase			$	139,675		$	(77,487)		$	62,188		$	(53,692)		$	8,496
Securities loaned			21,981			(9,682)			12,299			(12,019)			280
Net amounts for which master netting agreements are not in place or may not be legally enforceable
Securities purchased under agreements to resell															$	12,514
Securities borrowed															1,041
Securities sold under agreements to repurchase															8,295
Securities loaned															139

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 Note 2 and Note 9 to the financial statements in the 2021 Form 10-K. For information related to offsetting of derivatives, see Note 6.

Gross Secured Financing Balances by Remaining Contractual Maturity

			At September 30, 2022
$ in millions			Overnight and Open			Less than 30 Days			30-90 Days			Over 90 Days			Total
Securities sold under agreements to repurchase			$	53,042		$	50,868		$	12,508		$	39,771		$	156,189
Securities loaned			15,249			—			1,398			8,626			25,273
Total included in the offsetting disclosure			$	68,291		$	50,868		$	13,906		$	48,397		$	181,462
Trading liabilities— Obligation to return securities received as collateral			22,373			—			—			—			22,373
Total			$	90,664		$	50,868		$	13,906		$	48,397		$	203,835

			53			September 2022 Form 10-Q

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Table of Contents
Notes to Consolidated Financial Statements (Unaudited)

			At December 31, 2021
$ in millions			Overnight and Open			Less than 30 Days			30-90 Days			Over 90 Days			Total
Securities sold under agreements to repurchase			$	29,271		$	53,987		$	17,099		$	39,318		$	139,675
Securities loaned			11,480			364			650			9,487			21,981
Total included in the offsetting disclosure			$	40,751		$	54,351		$	17,749		$	48,805		$	161,656
Trading liabilities— Obligation to return securities received as collateral			30,104			—			—			—			30,104
Total			$	70,855		$	54,351		$	17,749		$	48,805		$	191,760

Gross Secured Financing Balances by Class of Collateral Pledged

$ in millions			At September 30, 2022			At December 31, 2021
Securities sold under agreements to repurchase
U.S. Treasury and agency securities			$	51,436		$	30,790
Other sovereign government obligations			74,401			73,063
Corporate equities			19,128			25,881
Other			11,224			9,941
Total			$	156,189		$	139,675
Securities loaned
Other sovereign government obligations			$	1,045		$	748
Corporate equities			23,688			20,656
Other			540			577
Total			$	25,273		$	21,981
Total included in the offsetting disclosure			$	181,462		$	161,656
Trading liabilities—Obligation to return securities received as collateral
Corporate equities			$	22,355		$	30,048
Other			18			56
Total			$	22,373		$	30,104
Total			$	203,835		$	191,760

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

$ in millions			At September 30, 2022			At December 31, 2021
Trading assets			$	32,461		$	32,458

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 September 30, 2022			At December 31, 2021
Collateral received with right to sell or repledge			$	630,129		$	672,104
Collateral that was sold or repledged1			489,010			510,000

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 September 30, 2022			At December 31, 2021
Segregated securities1			$	36,579		$	20,092

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 September 30, 2022			At December 31, 2021
Margin and other lending			$	43,415		$	71,532

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 9 to the financial statements in the 2021 Form 10-K.

Also included in the amounts in the previous table is non-purpose securities-based lending on non-bank 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.

September 2022 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 September 30, 2022
$ in millions			HFI Loans			HFS Loans			Total Loans
Corporate			$	6,858		$	7,640		$	14,498
Secured lending facilities			34,788			3,707			38,495
Commercial real estate			8,191			1,750			9,941
Residential real estate			52,904			5			52,909
Securities-based lending and Other loans			95,591			251			95,842
Total loans			198,332			13,353			211,685
ACL			(749)						(749)
Total loans, net			$	197,583		$	13,353		$	210,936
Loans to non-U.S. borrowers, net									$	24,624

			At December 31, 2021
$ in millions			HFI Loans			HFS Loans			Total Loans
Corporate			$	5,567		$	8,107		$	13,674
Secured lending facilities			31,471			3,879			35,350
Commercial real estate			7,227			1,777			9,004
Residential real estate			44,251			7			44,258
Securities-based lending and Other loans			86,440			62			86,502
Total loans			174,956			13,832			188,788
ACL			(654)						(654)
Total loans, net			$	174,302		$	13,832		$	188,134
Loans to non-U.S. borrowers, net									$	24,322

For additional information on the Firm’s held-for-investment and held-for-sale loan portfolios, see Note 10 to the financial statements in the 2021 Form 10-K.

Loans by Interest Rate Type

			At September 30, 2022						At December 31, 2021
$ in millions			Fixed Rate			Floating or Adjustable Rate			Fixed Rate			Floating or Adjustable Rate
Corporate			$	—		$	14,498		$	—		$	13,674
Secured lending facilities			—			38,495			—			35,350
Commercial real estate			205			9,735			343			8,661
Residential real estate			24,105			28,805			18,966			25,292
Securities-based lending and Other loans			24,141			71,701			22,832			63,670
Total loans, before ACL			$	48,451		$	163,234		$	42,141		$	146,647

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 Origination Year

			At September 30, 2022									At December 31, 2021
			Corporate
$ in millions			IG			NIG			Total			IG			NIG			Total
Revolving			$	3,111		$	3,119		$	6,230		$	2,356		$	2,328		$	4,684
2022			—			80			80
2021			—			92			92			—			85			85
2020			16			25			41			111			26			137
2019			—			153			153			—			176			176
2018			146			—			146			196			—			196
Prior			115			1			116			229			60			289
Total			$	3,388		$	3,470		$	6,858		$	2,892		$	2,675		$	5,567

			At September 30, 2022									At December 31, 2021
			Secured Lending Facilities
$ in millions			IG			NIG			Total			IG			NIG			Total
Revolving			$	9,413		$	21,231		$	30,644		$	7,603		$	20,172		$	27,775
2022			590			995			1,585
2021			234			196			430			32			467			499
2020			—			107			107			35			160			195
2019			60			556			616			43			819			862
2018			—			284			284			297			703			1,000
Prior			217			905			1,122			144			996			1,140
Total			$	10,514		$	24,274		$	34,788		$	8,154		$	23,317		$	31,471

			At September 30, 2022									At December 31, 2021
			Commercial Real Estate
$ in millions			IG			NIG			Total			IG			NIG			Total
Revolving			$	4		$	154		$	158		$	3		$	149		$	152
2022			503			1,806			2,309
2021			283			1,492			1,775			423			1,292			1,715
2020			92			639			731			91			819			910
2019			923			862			1,785			976			1,266			2,242
2018			475			299			774			527			416			943
Prior			86			573			659			189			1,076			1,265
Total			$	2,366		$	5,825		$	8,191		$	2,209		$	5,018		$	7,227

			At September 30, 2022
			Residential Real Estate
			by FICO Scores												by LTV Ratio									Total
$ in millions			≥ 740			680-739			≤ 679						≤ 80%			> 80%
Revolving			$	75		$	27		$	4					$	106		$	—					$	106
2022			9,741			2,109			342						11,257			935						12,192
2021			11,749			2,529			260						13,555			983						14,538
2020			7,396			1,523			116						8,573			462						9,035
2019			4,268			956			138						5,031			331						5,362
2018			1,663			457			51						2,001			170						2,171
Prior			7,045			2,143			312						8,737			763						9,500
Total			$	41,937		$	9,744		$	1,223					$	49,260		$	3,644					$	52,904

			At December 31, 2021
			Residential Real Estate
			by FICO Scores												by LTV Ratio									Total
$ in millions			≥ 740			680-739			≤ 679						≤ 80%			> 80%
Revolving			$	65		$	27		$	4					$	96		$	—					$	96
2021			12,230			2,638			257						14,116			1,009						15,125
2020			7,941			1,648			131						9,210			510						9,720
2019			4,690			1,072			140						5,536			366						5,902
2018			1,865			497			55						2,231			186						2,417
2017			2,157			558			65						2,588			192						2,780
Prior			5,973			1,919			319						7,485			726						8,211
Total			$	34,921		$	8,359		$	971					$	41,262		$	2,989					$	44,251

			55			September 2022 Form 10-Q

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Table of Contents
Notes to Consolidated Financial Statements (Unaudited)

			At September 30, 2022
			Securities-based Lending1			Other2
$ in millions						IG			NIG			Total
Revolving			$	78,639		$	5,695		$	1,375		$	85,709
2022			1,409			1,379			108			2,896
2021			714			541			144			1,399
2020			—			529			548			1,077
2019			18			912			625			1,555
2018			202			301			243			746
Prior			16			1,562			631			2,209
Total			$	80,998		$	10,919		$	3,674		$	95,591

			December 31, 2021
			Securities-based Lending1			Other2
$ in millions						IG			NIG			Total
Revolving			$	71,485		$	6,170		$	858		$	78,513
2021			807			708			103			1,618
2020			—			651			626			1,277
2019			19			1,079			633			1,731
2018			232			273			375			880
2017			—			531			217			748
Prior			16			1,294			363			1,673
Total			$	72,559		$	10,706		$	3,175		$	86,440

IG—Investment Grade

NIG—Non-investment Grade

1. Securities-based loans are subject to collateral maintenance provisions, and at September 30, 2022 and December 31, 2021, 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 2021 Form 10-K.

2. Other loans primarily include certain loans originated in the tailored lending business within the Wealth Management business segment.

Past Due Loans Held for Investment before Allowance1

$ in millions			At September 30, 2022			At December 31, 2021
Corporate			$	44		$	—
Residential real estate			141			209
Total			$	185		$	209

1.The majority of the amounts are past due for a period of less than 90 days.

Nonaccrual Loans Held for Investment before Allowance

$ in millions			At September 30, 2022			At December 31, 2021
Corporate			$	60		$	34
Secured lending facilities			99			375
Commercial real estate			130			195
Residential real estate			120			138
Securities-based lending and Other loans			4			151
Total1			$	413		$	893
Nonaccrual loans without an ACL			$	108		$	356

1.Includes all loans held for investment that are 90 days or more past due as of September 30, 2022 and December 31, 2021.

See Note 2 to the financial statements in the 2021 Form 10-K for a description of the ACL calculated under the CECL methodology, including credit quality indicators, used for HFI loans.

Troubled Debt Restructurings

$ in millions			At September 30, 2022			At December 31, 2021
Loans, before ACL			$	27		$	49
Allowance for credit losses			—			8

Troubled debt restructurings typically include modifications of interest rates, collateral requirements, other loan covenants and payment extensions. See Note 2 to the financial statements in the 2021 Form 10-K for further information on TDR guidance issued by Congress in the CARES Act as well as by the U.S. banking agencies.

Allowance for Credit Losses Rollforward and Allocation—Loans

$ in millions			Corporate			Secured Lending Facilities			CRE			Residential Real Estate			SBL and Other			Total
December 31, 2021			$	165		$	163		$	206		$	60		$	60		$	654
Gross charge-offs			—			(3)			(7)			—			(21)			(31)
Recoveries			6			—			—			1			—			7
Net (charge-offs) recoveries			6			(3)			(7)			1			(21)			(24)
Provision (release)			46			(2)			35			26			32			137
Other			(6)			(2)			(10)			—			—			(18)
September 30, 2022			$	211		$	156		$	224		$	87		$	71		$	749
Percent of loans to total loans1			3		%	18		%	4		%	27		%	48		%	100		%

$ in millions			Corporate			Secured Lending Facilities			CRE			Residential Real Estate			SBL and Other			Total
December 31, 2020			$	309		$	198		$	211		$	59		$	58		$	835
Gross charge-offs			(19)			(67)			(21)			—			—			(107)
Provision (release)			(91)			47			4			(2)			5			(37)
Other			(2)			(3)			(1)			1			(2)			(7)
September 30, 2021			$	197		$	175		$	193		$	58		$	61		$	684
Percent of loans to total loans1			3		%	17		%	4		%	26		%	50		%	100		%

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.

Allowance for Credit Losses Rollforward—Lending Commitments

$ in millions			Corporate			Secured Lending Facilities			CRE			Residential Real Estate			SBL and Other			Total
December 31, 2021			$	356		$	41		$	20		$	1		$	26		$	444
Provision (release)			64			7			(6)			1			(10)			56
Other			(12)			(1)			—			—			—			(13)
September 30, 2022			$	408		$	47		$	14		$	2		$	16		$	487

$ in millions			Corporate			Secured Lending Facilities			CRE			Residential Real Estate			SBL and Other			Total
December 31, 2020			$	323		$	38		$	11		$	1		$	23		$	396
Provision (release)			39			2			—			—			(5)			36
Other			(3)			1			(1)			—			—			(3)
September 30, 2021			$	359		$	41		$	10		$	1		$	18		$	429

September 2022 Form 10-Q			56

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Table of Contents
Notes to Consolidated Financial Statements (Unaudited)

Provision for Credit Losses

			Three Months Ended September 30,
$ in millions			2022			2021
Loans			$	6		$	5
Lending commitments			29			19

The aggregate allowance for credit losses for loans and lending commitments increased in the current year period, reflecting the Provision for credit losses due to portfolio growth and deterioration in macroeconomic outlook. The base scenario used in our ACL models as of September 30, 2022 was generated using a combination of consensus economic forecasts, forward rates, and internally developed and validated models, and assumes slower economic growth over the forecast period. Given the nature of our lending portfolio, the most sensitive model input is U.S. gross domestic product. For a further discussion of the Firm’s loans as well as the Firm’s allowance methodology, refer to Notes 2 and 10 to the financial statements in the 2021 Form 10-K.

Selected Credit Ratios

			At September 30, 2022			At December 31, 2021
ACL to total loans1			0.4		%	0.4		%
Nonaccrual loans to total loans2			0.2		%	0.5		%
ACL to nonaccrual loans3			181.4		%	73.2		%

1.Allowance for credit losses for loans to total loans held for investment.

2.Nonaccrual loans held for investment, which are loans that are 90 days or more past due, to total loans held for investment.

3.Allowance for credit losses for loans to nonaccrual loans held for investment.

Employee Loans

$ in millions			At September 30, 2022			At December 31, 2021
Currently employed by the Firm1			$	3,967		$	3,613
No longer employed by the Firm2			98			113
Employee loans			$	4,065		$	3,726
ACL			(141)			(153)
Employee loans, net of ACL			$	3,924		$	3,573
Remaining repayment term, weighted average in years			5.8			5.7

1.These loans are predominantly current as of September 30, 2022 and December 31, 2021.

2.These loans are predominantly past due for a period of 90 days or more as of September 30, 2022 and December 31, 2021.

Employee loans are granted in conjunction with a program established primarily to recruit certain Wealth Management representatives, 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 2021 Form 10-K for a description of the CECL allowance methodology, including credit quality indicators, for employee loans.

10. Other Assets—Equity Method Investments

Equity Method Investments

$ in millions			At September 30, 2022			At December 31, 2021
Investments			$	1,881		$	2,214

			Three Months Ended September 30,						Nine Months Ended September 30,
$ in millions			2022			2021			2022			2021
Income (loss)			$	21		$	24		$	44		$	51

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 September 30,						Nine Months Ended September 30,
$ in millions			2022			2021			2022			2021
Income (loss) from investment in MUMSS			$	17		$	29		$	35		$	113

For more information on MUMSS and other relationships with MUFG, see Note 12 to the financial statements in the 2021 Form 10-K.

11. Deposits

Deposits

$ in millions			At September 30, 2022			At December 31, 2021
Savings and demand deposits			$	317,129		$	332,747
Time deposits			20,994			14,827
Total			$	338,123		$	347,574
Deposits subject to FDIC insurance			$	239,194		$	230,894
Deposits not subject to FDIC insurance			$	98,929		$	116,680

Time Deposit Maturities

$ in millions			At September 30, 2022
2022			$	1,948
2023			9,279
2024			5,640
2025			2,093
2026			623
Thereafter			1,411
Total			$	20,994

			57			September 2022 Form 10-Q

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Table of Contents
Notes to Consolidated Financial Statements (Unaudited)

12. Borrowings and Other Secured Financings

Borrowings

$ in millions			At September 30, 2022			At December 31, 2021
Original maturities of one year or less			$	4,062		$	5,764
Original maturities greater than one year
Senior			$	202,251		$	213,776
Subordinated			14,110			13,587
Total			$	216,361		$	227,363
Total borrowings			$	220,423		$	233,127
Weighted average stated maturity, in years1			6.7			7.7

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

Other Secured Financings

$ in millions			At September 30, 2022			At December 31, 2021
Original maturities:
One year or less			$	295		$	4,573
Greater than one year			7,406			5,468
Total			$	7,701		$	10,041
Transfers of assets accounted for as secured financings			$	931		$	1,556

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 September 30, 2022
$ in millions			Less than 1			1-3			3-5			Over 5			Total
Lending:
Corporate			$	11,654		$	29,955		$	54,877		$	6,105		$	102,591
Secured lending facilities			6,297			6,007			1,814			775			14,893
Commercial and Residential real estate			103			339			18			296			756
Securities-based lending and Other			12,415			5,012			548			390			18,365
Forward-starting secured financing receivables			62,091			—			—			—			62,091
Central counterparty			300			—			—			4,909			5,209
Underwriting			2,350			—			—			—			2,350
Investment activities			1,479			169			65			351			2,064
Letters of credit and other financial guarantees			168			—			—			2			170
Total			$	96,857		$	41,482		$	57,322		$	12,828		$	208,489
Lending commitments participated to third parties															$	7,877
Forward-starting secured financing receivables settled within three business days															$	45,666

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 15 to the financial statements in the 2021 Form 10-K.

Guarantees

			At September 30, 2022
			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			$	1,168,376		$	917,531		$	351,872		$	759,598					$	(107,603)
Standby letters of credit and other financial guarantees issued2			1,641			826			1,310			2,672						6
Market value guarantees			5			2			—			—						—
Liquidity facilities			3,712			—			—			—						(6)
Whole loan sales guarantees			—			9			78			23,079						—
Securitization representations and warranties3			—			—			—			80,236						(3)
General partner guarantees			361			10			32			157						(88)
Client clearing guarantees			159			—			—			—						—

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. As of September 30, 2022, the carrying amount of standby letters of credit and other financial guarantees issued includes an allowance for credit losses of $74 million.

3.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

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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 15 to the financial statements in the 2021 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 15 to the financial statements in the 2021 Form 10-K.

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 matter 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, as well as being subject to regulatory investigations arising in connection with its activities as a global diversified financial services institution. Certain of the actual or threatened legal actions or regulatory investigations include claims for substantial penalties, compensatory and/or punitive damages or claims for indeterminate amounts of penalties or damages. In some cases, the entities that would otherwise be the primary defendants in such legal actions are bankrupt or are in financial distress. These actions and investigations have

included, but are not limited to, antitrust, false claims act, residential mortgage and credit crisis-related matters.

While the Firm has identified below any individual proceedings where the Firm believes a material loss to be reasonably possible and reasonably estimable, there can be no assurance that material losses will not be incurred from claims that have not yet been asserted or those where potential losses have not yet been determined to be probable or possible and reasonably estimable.

			Three Months Ended September 30,						Nine Months Ended September 30,
$ in millions			2022			2021			2022			2021
Legal expenses			$	41		$	50		$	387		$	99

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

In many proceedings and investigations, however, it is inherently difficult to determine whether any loss is probable or even possible or to estimate the amount of any loss. In addition, even where a loss is possible or an exposure to loss exists in excess of the liability already accrued with respect to a previously recognized loss contingency, it is not always possible to reasonably estimate the size of the possible loss or range of loss, particularly for proceedings and investigations where the factual record is being developed or contested or where plaintiffs or government entities seek substantial or indeterminate damages, restitution, disgorgement or penalties. Numerous issues may need to be resolved before a loss or additional loss, or range of loss or additional range of loss, can be reasonably estimated for a proceeding or investigation, including through potentially lengthy discovery and determination of important factual matters, determination of issues related to class certification and the calculation of damages or other relief, and consideration of novel or unsettled legal questions relevant to the proceedings or investigations in question.

For certain other legal proceedings and investigations, the Firm can estimate reasonably possible losses, additional losses, ranges of loss or ranges of additional loss in excess of amounts accrued but 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, other than the matter referred to in the following paragraph.

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 $122 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

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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 June 22, 2020, the Firm filed an appeal against the decision of the Court of Appeal in Amsterdam before the Dutch High Court. On January 29, 2021, the Advocate General of the Dutch High Court issued an advisory opinion on the Firm’s appeal, which rejected the Firm’s principal grounds of appeal. On February 11, 2021, the Firm and the Dutch Authority each responded to this opinion. 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.

14. Variable Interest Entities and Securitization Activities

Consolidated VIE Assets and Liabilities by Type of Activity

			At September 30, 2022						At December 31, 2021
$ in millions			VIE Assets			VIE Liabilities			VIE Assets			VIE Liabilities
MABS1			$	1,006		$	471		$	1,177		$	409
Investment vehicles2			885			508			717			294
Operating entities			502			33			508			39
Other			844			584			510			286
Total			$	3,237		$	1,596		$	2,912		$	1,028

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 September 30, 2022			At December 31, 2021
Assets
Cash and cash equivalents			$	368		$	341
Trading assets at fair value			2,074			1,965
Investment securities			244			37
Securities purchased under agreements to resell			200			200
Customer and other receivables			30			31
Intangible assets			76			85
Other assets			245			253
Total			$	3,237		$	2,912
Liabilities
Other secured financings			$	1,420		$	767
Other liabilities and accrued expenses			176			261
Total			$	1,596		$	1,028
Noncontrolling interests			$	103		$	115

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.

Non-consolidated VIEs

			At September 30, 2022
$ in millions			MABS1			CDO			MTOB			OSF			Other2
VIE assets (UPB)			$	125,670		$	170		$	5,448		$	2,302		$	49,714
Maximum exposure to loss3
Debt and equity interests			$	12,946		$	100		$	—		$	1,592		$	11,423
Derivative and other contracts			—			—			3,712			—			4,637
Commitments, guarantees and other			499			—			—			—			754
Total			$	13,445		$	100		$	3,712		$	1,592		$	16,814
Carrying value of variable interests—Assets
Debt and equity interests			$	12,946		$	100		$	—		$	1,592		$	11,423
Derivative and other contracts			—			—			5			—			1,794
Total			$	12,946		$	100		$	5		$	1,592		$	13,217
Additional VIE assets owned4															$	13,500
Carrying value of variable interests—Liabilities
Derivative and other contracts			$	—		$	—		$	11		$	—		$	448

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			At December 31, 2021
$ in millions			MABS1			CDO			MTOB			OSF			Other2
VIE assets (UPB)			$	146,071		$	667		$	6,089		$	2,086		$	52,111
Maximum exposure to loss3
Debt and equity interests			$	18,062		$	129		$	—		$	1,459		$	10,339
Derivative and other contracts			—			—			4,100			—			5,599
Commitments, guarantees and other			771			—			—			—			1,005
Total			$	18,833		$	129		$	4,100		$	1,459		$	16,943
Carrying value of variable interests–Assets
Debt and equity interests			$	18,062		$	129		$	—		$	1,459		$	10,339
Derivative and other contracts			—			—			5			—			2,006
Total			$	18,062		$	129		$	5		$	1,459		$	12,345
Additional VIE assets owned4															$	15,392
Carrying value of variable interests—Liabilities
Derivative and other contracts			$	—		$	—		$	—		$	—		$	362

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.

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 majority of the VIEs included in the previous tables are sponsored by unrelated parties; 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 September 30, 2022						At December 31, 2021
$ in millions			UPB			Debt and Equity Interests			UPB			Debt and Equity Interests
Residential mortgages			$	11,853		$	2,002		$	15,216		$	2,182
Commercial mortgages			78,298			4,572			68,503			4,092
U.S. agency collateralized mortgage obligations			32,493			4,865			57,972			9,835
Other consumer or commercial loans			3,026			1,507			4,380			1,953
Total			$	125,670		$	12,946		$	146,071		$	18,062

Transferred Assets with Continuing Involvement

			At September 30, 2022
$ in millions			RML			CML			U.S. Agency CMO			CLN and Other1
SPE assets (UPB)2			$	9,395		$	92,284		$	17,854		$	10,775
Retained interests
Investment grade			$	111		$	930		$	279		$	—
Non-investment grade			24			504			11			45
Total			$	135		$	1,434		$	290		$	45
Interests purchased in the secondary market
Investment grade			$	33		$	181		$	45		$	—
Non-investment grade			43			46			—			—
Total			$	76		$	227		$	45		$	—
Derivative assets			$	—		$	—		$	—		$	1,259
Derivative liabilities			—			—			—			282

			At December 31, 2021
$ in millions			RML			CML			U.S. Agency CMO			CLN and Other1
SPE assets (UPB)2			$	6,802		$	94,276		$	28,697		$	13,121
Retained interests
Investment grade			$	72		$	638		$	465		$	—
Non-investment grade			19			586			—			69
Total			$	91		$	1,224		$	465		$	69
Interests purchased in the secondary market
Investment grade			$	18		$	118		$	33		$	—
Non-investment grade			38			53			—			4
Total			$	56		$	171		$	33		$	4
Derivative assets			$	—		$	—		$	—		$	891
Derivative liabilities			—			—			—			284

			Fair Value At September 30, 2022
$ in millions			Level 2			Level 3			Total
Retained interests
Investment grade			$	557		$	—		$	557
Non-investment grade			24			36			60
Total			$	581		$	36		$	617
Interests purchased in the secondary market
Investment grade			$	257		$	2		$	259
Non-investment grade			71			18			89
Total			$	328		$	20		$	348
Derivative assets			$	1,259		$	—		$	1,259
Derivative liabilities			239			43			282

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			Fair Value at December 31, 2021
$ in millions			Level 2			Level 3			Total
Retained interests
Investment grade			$	536		$	2		$	538
Non-investment grade			40			40			80
Total			$	576		$	42		$	618
Interests purchased in the secondary market
Investment grade			$	168		$	1		$	169
Non-investment grade			70			25			95
Total			$	238		$	26		$	264
Derivative assets			$	891		$	—		$	891
Derivative liabilities			194			90			284

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.

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. These retained interests are generally 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 2021 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 September 30,						Nine Months Ended September 30,
$ in millions			2022			2021			2022			2021
New transactions1			$	5,332		$	12,103		$	19,809		$	43,303
Retained interests			500			2,396			3,553			7,960
Sales of corporate loans to CLO SPEs1, 2			37			144			53			217

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 September 30, 2022			At December 31, 2021
Gross cash proceeds from sale of assets1			$	50,718		$	67,930
Fair value
Assets sold			$	48,474		$	68,992
Derivative assets recognized in the balance sheet			160			1,195
Derivative liabilities recognized in the balance sheet			2,405			132

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 16 to the financial statements in the 2021 Form 10-K.

15. Regulatory Requirements

Regulatory Capital Framework and Requirements

For a discussion of the Firm’s regulatory capital framework, see Note 17 to the financial statements in the 2021 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 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 September 30, 2022 and December 31, 2021, the differences between the actual and required ratios were lower under the Standardized Approach.

CECL Deferral. As of December 31, 2021, the risk-based and leverage-based capital amounts and ratios, as well as RWA, adjusted average assets and supplementary leverage exposure were calculated excluding the effect of the adoption of CECL based on the Firm’s election to defer this effect over a five-year transition period that began on January 1, 2020. In 2022 the deferral impacts began to phase in at 25% per year and will become fully phased-in beginning in 2025.

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Capital Buffer Requirements

			At September 30, 2022 and December 31, 2021
			Standardized			Advanced
Capital buffers
Capital conservation buffer			—			2.5%
SCB			5.7%			N/A
G-SIB capital surcharge			3.0%			3.0%
CCyB1			0%			0%
Capital buffer requirement			8.7%			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 Standardized Approach capital buffer requirement is equal to the sum of the SCB, G-SIB capital surcharge and CCyB, and the Advanced Approach capital buffer requirement is equal to the 2.5% capital conservation buffer, G-SIB capital surcharge and CCyB.

Risk-Based Regulatory Capital Ratio Requirements

			Regulatory Minimum			At September 30, 2022 and December 31, 2021
						Standardized			Advanced
Required ratios1
Common Equity Tier 1 capital ratio			4.5		%	13.2%			10.0%
Tier 1 capital ratio			6.0		%	14.7%			11.5%
Total capital ratio			8.0		%	16.7%			13.5%

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

The Firm’s Regulatory Capital and Capital Ratios

$ in millions			Required Ratio1			At September 30, 2022			At December 31, 2021
Risk-based capital
Common Equity Tier 1 capital						$	67,933		$	75,742
Tier 1 capital						76,428			83,348
Total capital						86,139			93,166
Total RWA						457,911			471,921
Common Equity Tier 1 capital ratio			13.2		%	14.8		%	16.0		%
Tier 1 capital ratio			14.7		%	16.7		%	17.7		%
Total capital ratio			16.7		%	18.8		%	19.7		%
$ in millions			Required Ratio1			At September 30, 2022			At December 31, 2021
Leverage-based capital
Adjusted average assets2						$	1,154,411		$	1,169,939
Tier 1 leverage ratio			4.0		%	6.6		%	7.1		%
Supplementary leverage exposure3						$	1,406,345		$	1,476,962
SLR			5.0		%	5.4		%	5.6		%

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

2.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 the Firm’s own capital instruments, certain defined tax assets and other capital deductions.

3.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.

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

The OCC establishes capital requirements for the Firm’s U.S. bank subsidiaries, which includes Morgan Stanley Bank, N.A. (“MSBNA”) and Morgan Stanley Private Bank, National Association (“MSPBNA”) (collectively, “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, 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 September 30, 2022 and December 31, 2021, MSBNA and MSPBNA risk-based capital ratios are based on the Standardized Approach rules. As of December 31, 2021, the risk-based and leverage-based capital amounts and ratios were calculated excluding the effect of the adoption of CECL based

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on MSBNA’s and MSPBNA’s election to defer this effect over a five-year transition period that began on January 1, 2020. In 2022 the deferral impacts began to phase in at 25% per year and will become fully phased-in beginning in 2025.

MSBNA’s Regulatory Capital

			Well-Capitalized Requirement			Required Ratio1			At September 30, 2022						At December 31, 2021
$ in millions									Amount			Ratio			Amount			Ratio
Risk-based capital
Common Equity Tier 1 capital			6.5		%	7.0		%	$	18,758		19.5		%	$	18,960		20.5		%
Tier 1 capital			8.0		%	8.5		%	18,758			19.5		%	18,960			20.5		%
Total capital			10.0		%	10.5		%	19,335			20.1		%	19,544			21.1		%
Leverage-based capital
Tier 1 leverage			5.0		%	4.0		%	$	18,758		9.6		%	$	18,960		10.2		%
SLR			6.0		%	3.0		%	18,758			7.6		%	18,960			8.1		%

MSPBNA’s Regulatory Capital

			Well-Capitalized Requirement			Required Ratio1			At September 30, 20222						At December 31, 2021
$ in millions									Amount			Ratio			Amount			Ratio
Risk-based capital
Common Equity Tier 1 capital			6.5		%	7.0		%	$	16,134		29.0		%	$	10,293		24.3		%
Tier 1 capital			8.0		%	8.5		%	16,134			29.0		%	10,293			24.3		%
Total capital			10.0		%	10.5		%	16,261			29.2		%	10,368			24.5		%
Leverage-based capital
Tier 1 leverage			5.0		%	4.0		%	$	16,134		8.1		%	$	10,293		6.9		%
SLR			6.0		%	3.0		%	16,134			7.9		%	10,293			6.7		%

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.

2.Regulatory capital amounts and ratios as of September 30, 2022 include the amounts from E*TRADE Bank (“ETB”) and E*TRADE Savings Bank (“ETSB”) as a result of the merger described herein.

Additionally, MSBNA is conditionally registered with the SEC as a security-based swap dealer and is provisionally 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 September 30, 2022			At December 31, 2021
Net capital			$	14,886		$	18,383
Excess net capital			10,405			14,208

MS&Co. is registered as a broker-dealer and a futures commission merchant with the SEC and the CFTC, respectively, and provisionally 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 provisionally-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 September 30, 2022 and December 31, 2021, MS&Co. exceeded its net capital requirement and had tentative net capital in excess of the minimum and notification requirements.

Other Regulated Subsidiaries

The following subsidiaries are also subject to various regulatory capital requirements and operated with capital in excess of their respective regulatory capital requirements as of September 30, 2022 and December 31, 2021, as applicable:

•MSSB,

•MSIP,

•Morgan Stanley Europe Holdings SE Group, including MSESE,

•MSMS,

•MSCS,

•MSCG, and

•E*TRADE Securities LLC.

ETB and ETSB were each previously subject to the capital requirements of the OCC until January 1, 2022, when ETSB merged with and into ETB, and subsequently ETB merged with and into MSPBNA, with MSPBNA as the surviving bank.

See Note 17 to the financial statements in the 2021 Form 10-K for further information.

16. Total Equity

Preferred Stock

			Shares Outstanding						Carrying Value
$ in millions, except per share data			At September 30, 2022			Liquidation Preference per Share			At September 30, 2022			At December 31, 2021
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			—
Total									$	8,750		$	7,750
Shares authorized												30,000,000

1.Series C preferred stock is held by MUFG.

For a description of Series A through Series O preferred stock, see Note 18 to the financial statements in the 2021 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

September 2022 Form 10-Q			64

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Table of Contents
Notes to Consolidated Financial Statements (Unaudited)

accordance with regulatory capital requirements (see Note 15).

On August 2, 2022, the Firm issued 40 million depositary shares of Series P Preferred Stock, for an aggregate price of $1.0 billion. Each depositary share represents a 1/1000th interest in a share of 6.500% Non-Cumulative Preferred Stock, Series P, $0.01 par value (“Series P Preferred Stock”). The Series P Preferred Stock is redeemable at the Firm’s option, (i) in whole or in part, from time to time, on any dividend payment date on or after October 15, 2027 or (ii) in whole but not in part at any time within 90 days following a regulatory capital treatment event (as described in the terms of this series), in each case at a redemption price of $25,000 per share (equivalent to $25 per depositary share). The Series P Preferred Stock also has a preference over the Firm’s common stock upon liquidation and qualifies as Tier 1 capital.

Share Repurchases

			Three Months Ended September 30,						Nine Months Ended September 30,
$ in millions			2022			2021			2022			2021
Repurchases of common stock under the Firm’s Share Repurchase Authorization			$	2,555		$	3,557		$	8,165		$	8,631

On June 27, 2022, the Firm announced that its Board of Directors approved a new multi-year repurchase authorization of up to $20 billion of outstanding common stock, without a set expiration date, beginning in the third quarter of 2022, which will be exercised from time to time as conditions warrant. For more information on share repurchases, see Note 18 to the financial statements in the 2021 Form 10-K.

Common Shares Outstanding for Basic and Diluted EPS

			Three Months Ended September 30,						Nine Months Ended September 30,
in millions			2022			2021			2022			2021
Weighted average common shares outstanding, basic			1,674			1,781			1,704			1,797
Effect of dilutive RSUs and PSUs			23			31			21			27
Weighted average common shares outstanding and common stock equivalents, diluted			1,697			1,812			1,725			1,824
Weighted average antidilutive common stock equivalents (excluded from the computation of diluted EPS)			1			—			5			—

Dividends

$ in millions, except per share data			Three Months Ended September 30, 2022						Three Months Ended September 30, 2021
			Per Share1			Total			Per Share1			Total
Preferred stock series
A			$	261		$	11		$	256		$	11
C			25			13			25			13
E			445			15			445			15
F			430			15			430			15
H2			—			—			239			12
I			398			16			398			16
K			366			15			366			15
L			305			6			305			6
M4			29			12			29			12
N5			2,650			8			2,650			8
O6			266			14			—			—
P			330			13			—			—
Total Preferred stock						$	138					$	123
Common stock			$	0.775		$	1,329		$	0.700		$	1,276

$ in millions, except per share data			Nine Months Ended September 30, 2022						Nine Months Ended September 30, 2021
			Per Share1			Total			Per Share1			Total
Preferred stock series
A			$	756		$	33		$	758		$	33
C			75			39			75			39
E			1,336			45			1,336			45
F			1,289			44			1,289			44
H2			—			—			719			37
I			1,195			48			1,195			48
J3			—			—			253			15
K			1,097			45			1,097			45
L			914			18			914			18
M4			59			24			59			24
N5			5,300			16			5,300			16
O6			797			41			—			—
P			330			13			—			—
Total Preferred stock						$	366					$	364
Common stock			$	2.175		$	3,802		$	1.400		$	2,562

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

2.A notice of redemption was issued for Series H preferred stock on November 19, 2021.

3.Series J was payable semiannually until July 15, 2020, after which it was payable quarterly until its redemption.

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

5.Series N is payable semiannually until March 15, 2023 and thereafter will be payable quarterly.

6.Series O is payable semiannually until January 15, 2027 and thereafter will be payable quarterly.

			65			September 2022 Form 10-Q

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Notes to Consolidated Financial Statements (Unaudited)

Accumulated Other Comprehensive Income (Loss)1

$ in millions			CTA			AFS Securities			Pension and Other			DVA			Total
June 30, 2022			$	(1,226)		$	(3,226)		$	(543)		$	(26)		$	(5,021)
OCI during the period			(207)			(1,307)			5			772			(737)
September 30, 2022			$	(1,433)		$	(4,533)		$	(538)		$	746		$	(5,758)
June 30, 2021			$	(895)		$	1,004		$	(481)		$	(2,151)		$	(2,523)
OCI during the period			(65)			(256)			5			138			(178)
September 30, 2021			$	(960)		$	748		$	(476)		$	(2,013)		$	(2,701)
December 31, 2021			$	(1,002)		$	245		$	(551)		$	(1,794)		$	(3,102)
OCI during the period			(431)			(4,778)			13			2,540			(2,656)
September 30, 2022			$	(1,433)		$	(4,533)		$	(538)		$	746		$	(5,758)
December 31, 2020			$	(795)		$	1,787		$	(498)		$	(2,456)		$	(1,962)
OCI during the period			(165)			(1,039)			22			443			(739)
September 30, 2021			$	(960)		$	748		$	(476)		$	(2,013)		$	(2,701)

1.Amounts are net of tax and noncontrolling interests.

Components of Period Changes in OCI

			Three Months Ended September 30, 2022
$ in millions			Pre-tax Gain (Loss)			Income Tax Benefit (Provision)			After-tax Gain (Loss)			Non- controlling Interests			Net
CTA
OCI activity			$	(85)		$	(183)		$	(268)		$	(61)		$	(207)
Reclassified to earnings			—			—			—			—			—
Net OCI			$	(85)		$	(183)		$	(268)		$	(61)		$	(207)
Change in net unrealized gains (losses) on AFS securities
OCI activity			$	(1,698)		$	398		$	(1,300)		$	—		$	(1,300)
Reclassified to earnings			(9)			2			(7)			—			(7)
Net OCI			$	(1,707)		$	400		$	(1,307)		$	—		$	(1,307)
Pension and other
OCI activity			$	1		$	—		$	1		$	—		$	1
Reclassified to earnings			6			(2)			4			—			4
Net OCI			$	7		$	(2)		$	5		$	—		$	5
Change in net DVA
OCI activity			$	1,082		$	(266)		$	816		$	44		$	772
Reclassified to earnings			—			—			—			—			—
Net OCI			$	1,082		$	(266)		$	816		$	44		$	772

			Three Months Ended September 30, 2021
$ in millions			Pre-tax Gain (Loss)			Income Tax Benefit (Provision)			After-tax Gain (Loss)			Non- controlling Interests			Net
CTA
OCI activity			$	(14)		$	(64)		$	(78)		$	(13)		$	(65)
Reclassified to earnings			—			—			—			—			—
Net OCI			$	(14)		$	(64)		$	(78)		$	(13)		$	(65)
Change in net unrealized gains (losses) on AFS securities
OCI activity			$	(317)		$	74		$	(243)		$	—		$	(243)
Reclassified to earnings			(17)			4			(13)			—			(13)
Net OCI			$	(334)		$	78		$	(256)		$	—		$	(256)
Pension and other
OCI activity			$	—		$	—		$	—		$	—		$	—
Reclassified to earnings			7			(2)			5			—			5
Net OCI			$	7		$	(2)		$	5		$	—		$	5
Change in net DVA
OCI activity			$	187		$	(46)		$	141		$	9		$	132
Reclassified to earnings			9			(3)			6			—			6
Net OCI			$	196		$	(49)		$	147		$	9		$	138

			Nine Months Ended September 30, 2022
$ in millions			Pre-tax Gain (Loss)			Income Tax Benefit (Provision)			After-tax Gain (Loss)			Non- controlling Interests			Net
CTA
OCI activity			$	(279)		$	(441)		$	(720)		$	(230)		$	(490)
Reclassified to earnings			—			59			59			—			59
Net OCI			$	(279)		$	(382)		$	(661)		$	(230)		$	(431)
Change in net unrealized gains (losses) on AFS securities
OCI activity			$	(6,169)		$	1,445		$	(4,724)		$	—		$	(4,724)
Reclassified to earnings			(71)			17			(54)			—			(54)
Net OCI			$	(6,240)		$	1,462		$	(4,778)		$	—		$	(4,778)
Pension and other
OCI activity			$	(1)		$	—		$	(1)		$	—		$	(1)
Reclassified to earnings			17			(3)			14			—			14
Net OCI			$	16		$	(3)		$	13		$	—		$	13
Change in net DVA
OCI activity			$	3,474		$	(845)		$	2,629		$	88		$	2,541
Reclassified to earnings			(1)			—			(1)			—			(1)
Net OCI			$	3,473		$	(845)		$	2,628		$	88		$	2,540

			Nine Months Ended September 30, 2021
$ in millions			Pre-tax Gain (Loss)			Income Tax Benefit (Provision)			After-tax Gain (Loss)			Non- controlling Interests			Net
CTA
OCI activity			$	(106)		$	(150)		$	(256)		$	(91)		$	(165)
Reclassified to earnings			—			—			—			—			—
Net OCI			$	(106)		$	(150)		$	(256)		$	(91)		$	(165)
Change in net unrealized gains (losses) on AFS securities
OCI activity			$	(1,146)		$	267		$	(879)		$	—		$	(879)
Reclassified to earnings			(209)			49			(160)			—			(160)
Net OCI			$	(1,355)		$	316		$	(1,039)		$	—		$	(1,039)
Pension and other
OCI activity			$	8		$	—		$	8		$	—		$	8
Reclassified to earnings			21			(7)			14			—			14
Net OCI			$	29		$	(7)		$	22		$	—		$	22
Change in net DVA
OCI activity			$	591		$	(148)		$	443		$	27		$	416
Reclassified to earnings			36			(9)			27			—			27
Net OCI			$	627		$	(157)		$	470		$	27		$	443

September 2022 Form 10-Q			66

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Notes to Consolidated Financial Statements (Unaudited)

17. Interest Income and Interest Expense

			Three Months Ended September 30,						Nine Months Ended September 30,
$ in millions			2022			2021			2022			2021
Interest income
Investment securities			$	743		$	643		$	2,261		$	2,100
Loans			1,910			1,063			4,469			3,091
Securities purchased under agreements to resell1,2			664			(36)			870			(147)
Securities borrowed1,3			385			(246)			97			(752)
Trading assets, net of Trading liabilities			635			525			1,722			1,521
Customer receivables and Other4			1,764			402			2,944			1,187
Total interest income			$	6,101		$	2,351		$	12,363		$	7,000
Interest expense
Deposits			$	476		$	102		$	684		$	330
Borrowings			1,370			597			2,990			2,030
Securities sold under agreements to repurchase1,5			501			19			725			82
Securities loaned1,6			135			112			340			279
Customer payables and Other7			1,109			(542)			616			(1,677)
Total interest expense			$	3,591		$	288		$	5,355		$	1,044
Net interest			$	2,510		$	2,063		$	7,008		$	5,956

1.Certain prior period amounts have been reclassified to conform to the current presentation.

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

3.Includes fees paid on Securities borrowed.

4.Includes interest from Cash and cash equivalents.

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 September 30, 2022			At December 31, 2021
Customer and other receivables			$	3,242		$	1,800
Customer and other payables			3,401			2,164

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 September 30, 2022
$ in millions			IS			WM			IM			I/E			Total
Investment banking			$	1,277		$	114		$	—		$	(18)		$	1,373
Trading			3,330			(41)			32			10			3,331
Investments			(73)			18			(113)			—			(168)
Commissions and fees1			648			543			—			(58)			1,133
Asset management1,2			140			3,389			1,269			(54)			4,744
Other			(25)			93			(1)			(4)			63
Total non-interest revenues			5,297			4,116			1,187			(124)			10,476
Interest income			3,889			2,626			18			(432)			6,101
Interest expense			3,369			622			37			(437)			3,591
Net interest			520			2,004			(19)			5			2,510
Net revenues			$	5,817		$	6,120		$	1,168		$	(119)		$	12,986
Provision for credit losses			$	24		$	11		$	—		$	—		$	35
Compensation and benefits			1,948			3,171			495			—			5,614
Non-compensation expenses			2,219			1,289			557			(116)			3,949
Total non-interest expenses			$	4,167		$	4,460		$	1,052		$	(116)		$	9,563
Income before provision for income taxes			$	1,626		$	1,649		$	116		$	(3)		$	3,388
Provision for income taxes			305			396			26			(1)			726
Net income			1,321			1,253			90			(2)			2,662
Net income applicable to noncontrolling interests			47			—			(17)			—			30
Net income applicable to Morgan Stanley			$	1,274		$	1,253		$	107		$	(2)		$	2,632

			Three Months Ended September 30, 2021
$ in millions			IS			WM			IM			I/E			Total
Investment banking			$	2,849		$	186		$	—		$	(22)		$	3,013
Trading			2,897			(58)			1			21			2,861
Investments			52			8			(15)			—			45
Commissions and fees1			664			704			—			(88)			1,280
Asset management1,2			145			3,628			1,470			(42)			5,201
Other			172			119			—			(1)			290
Total non-interest revenues			6,779			4,587			1,456			(132)			12,690
Interest income			948			1,464			8			(69)			2,351
Interest expense			232			116			11			(71)			288
Net interest			716			1,348			(3)			2			2,063
Net revenues			$	7,495		$	5,935		$	1,453		$	(130)		$	14,753
Provision for credit losses			$	24		$	—		$	—		$	—		$	24
Compensation and benefits			2,248			3,159			513			—			5,920
Non-compensation expenses			2,250			1,246			570			(131)			3,935
Total non-interest expenses			$	4,498		$	4,405		$	1,083		$	(131)		$	9,855
Income before provision for income taxes			$	2,973		$	1,530		$	370		$	1		$	4,874
Provision for income taxes			713			373			64			—			1,150
Net income			2,260			1,157			306			1			3,724
Net income applicable to noncontrolling interests			31			—			(14)			—			17
Net income applicable to Morgan Stanley			$	2,229		$	1,157		$	320		$	1		$	3,707

			67			September 2022 Form 10-Q

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Notes to Consolidated Financial Statements (Unaudited)

			Nine Months Ended September 30, 2022
$ in millions			IS			WM			IM			I/E			Total
Investment banking			$	3,983		$	354		$	—		$	(56)		$	4,281
Trading			11,511			(681)			38			43			10,911
Investments			(69)			45			(46)			—			(70)
Commissions and fees1			2,110			1,869			—			(210)			3,769
Asset management1,2			442			10,525			3,961			(153)			14,775
Other			(131)			388			(2)			(10)			245
Total non-interest revenues			17,846			12,500			3,951			(386)			33,911
Interest income			6,797			6,208			34			(676)			12,363
Interest expense			5,050			917			71			(683)			5,355
Net interest			1,747			5,291			(37)			7			7,008
Net revenues			$	19,593		$	17,791		$	3,914		$	(379)		$	40,919
Provision for credit losses			$	150		$	43		$	—		$	—		$	193
Compensation and benefits			6,602			9,191			1,645			—			17,438
Non-compensation expenses			6,874			3,814			1,676			(371)			11,993
Total non-interest expenses			$	13,476		$	13,005		$	3,321		$	(371)		$	29,431
Income before provision for income taxes			$	5,967		$	4,743		$	593		$	(8)		$	11,295
Provision for income taxes			1,235			1,028			121			(2)			2,382
Net income			4,732			3,715			472			(6)			8,913
Net income applicable to noncontrolling interests			146			—			(26)			—			120
Net income applicable to Morgan Stanley			$	4,586		$	3,715		$	498		$	(6)		$	8,793

			Nine Months Ended September 30, 2021
$ in millions			IS			WM			IM			I/E			Total
Investment banking			$	7,838		$	640		$	—		$	(65)		$	8,413
Trading			10,048			323			(18)			63			10,416
Investments			199			24			521			—			744
Commissions and fees1			2,216			2,269			1			(272)			4,214
Asset management1,2			432			10,266			3,991			(117)			14,572
Other			467			479			(23)			(7)			916
Total non-interest revenues			21,200			14,001			4,472			(398)			39,275
Interest income			2,791			4,316			26			(133)			7,000
Interest expense			827			328			29			(140)			1,044
Net interest			1,964			3,988			(3)			7			5,956
Net revenues			$	23,164		$	17,989		$	4,469		$	(391)		$	45,231
Provision for credit losses			$	1		$	(2)		$	—		$	—		$	(1)
Compensation and benefits			7,795			9,604			1,742			—			19,141
Non-compensation expenses			6,526			3,621			1,557			(397)			11,307
Total non-interest expenses			$	14,321		$	13,225		$	3,299		$	(397)		$	30,448
Income before provision for income taxes			$	8,842		$	4,766		$	1,170		$	6		$	14,784
Provision for income taxes			2,023			1,103			253			1			3,380
Net income			6,819			3,663			917			5			11,404
Net income applicable to noncontrolling interests			85			—			(19)			—			66
Net income applicable to Morgan Stanley			$	6,734		$	3,663		$	936		$	5		$	11,338

1.Substantially all revenues are from contracts with customers.

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

For a discussion about the Firm’s business segments, see Note 23 to the financial statements in the 2021 Form 10-K.

Detail of Investment Banking Revenues

			Three Months Ended September 30,						Nine Months Ended September 30,
$ in millions			2022			2021			2022			2021
Institutional Securities Advisory			$	693		$	1,272		$	2,235		$	2,416
Institutional Securities Underwriting			584			1,577			1,748			5,422
Firm Investment banking revenues from contracts with customers			89		%	91		%	89		%	91		%

Trading Revenues by Product Type

			Three Months Ended September 30,						Nine Months Ended September 30,
$ in millions			2022			2021			2022			2021
Interest rate			$	1,070		$	(32)		$	1,930		$	844
Foreign exchange			31			253			1,154			841
Equity1			1,872			1,903			5,869			5,631
Commodity and other			279			538			1,288			2,079
Credit			79			199			670			1,021
Total			$	3,331		$	2,861		$	10,911		$	10,416

1.Dividend income is included within equity contracts.

The previous table summarizes realized and unrealized gains and losses, 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 September 30, 2022			At December 31, 2021
Net cumulative unrealized performance-based fees at risk of reversing			$	837		$	802

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 September 30,						Nine Months Ended September 30,
$ in millions			2022			2021			2022			2021
Fee waivers			$	28		$	139		$	193		$	364

September 2022 Form 10-Q			68

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Notes to Consolidated Financial Statements (Unaudited)

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 September 30,						Nine Months Ended September 30,
$ in millions			2022			2021			2022			2021
Transaction taxes			$	215		$	262		$	701		$	717

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.

Net Revenues by Region

			Three Months Ended September 30,						Nine Months Ended September 30,
$ in millions			2022			2021			2022			2021
Americas			$	10,094		$	11,255		$	30,220		$	33,331
EMEA			1,392			1,752			5,381			6,004
Asia			1,500			1,746			5,318			5,896
Total			$	12,986		$	14,753		$	40,919		$	45,231

For a discussion about the Firm’s geographic net revenues, see Note 23 to the financial statements in the 2021 Form 10-K.

Revenues Recognized from Prior Services

			Three Months Ended September 30,						Nine Months Ended September 30,
$ in millions			2022			2021			2022			2021
Non-interest revenues			$	788		$	1,308		$	2,036		$	1,862

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 September 30, 2022			At December 31, 2021
Customer and other receivables			$	2,483		$	3,591

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 September 30, 2022			At December 31, 2021
Institutional Securities			$	786,384		$	792,135
Wealth Management			356,467			378,438
Investment Management			17,178			17,567
Total1			$	1,160,029		$	1,188,140

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

			69			September 2022 Form 10-Q

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Financial Data Supplement (Unaudited)

Average Balances and Interest Rates and Net Interest Income

			Three Months Ended September 30,
			2022									2021
$ in millions			Average Daily Balance			Interest			Annualized Average Rate			Average Daily Balance			Interest			Annualized Average Rate
Interest earning assets
Investment securities1			$	164,889		$	743		1.8		%	$	179,626		$	643		1.4		%
Loans1			209,551			1,910			3.6		%	170,656			1,063			2.5		%
Securities purchased under agreements to resell2,3:
U.S.			56,111			513			3.6		%	50,479			19			0.1		%
Non-U.S.			61,118			151			1.0		%	51,850			(55)			(0.4)		%
Securities borrowed2,4:
U.S.			126,061			373			1.2		%	103,643			(196)			(0.8)		%
Non-U.S.			17,966			12			0.3		%	19,416			(50)			(1.0)		%
Trading assets, net of Trading liabilities5:
U.S.			74,651			535			2.8		%	77,576			411			2.1		%
Non-U.S.			12,976			100			3.1		%	22,880			114			2.0		%
Customer receivables and Other6:
U.S.			105,345			1,378			5.2		%	137,525			358			1.0		%
Non-U.S.			76,056			386			2.0		%	73,130			44			0.2		%
Total			$	904,724		$	6,101		2.7		%	$	886,781		$	2,351		1.1		%
Interest bearing liabilities
Deposits1			$	337,288		$	476		0.6		%	$	325,520		$	102		0.1		%
Borrowings1,7			229,821			1,370			2.4		%	227,880			597			1.0		%
Securities sold under agreements to repurchase2,8,10:
U.S.			19,344			324			6.6		%	29,956			38			0.5		%
Non-U.S.			40,110			177			1.8		%	29,027			(19)			(0.3)		%
Securities loaned2,9,10:
U.S.			7,103			20			1.1		%	4,799			14			1.2		%
Non-U.S.			6,930			115			6.6		%	6,192			98			6.3		%
Customer payables and Other11:
U.S.			145,061			738			2.0		%	129,298			(431)			(1.3)		%
Non-U.S.			72,328			371			2.0		%	76,248			(111)			(0.6)		%
Total			$	857,985		$	3,591		1.7		%	$	828,920		$	288		0.1		%
Net interest income and net interest rate spread						$	2,510		1.0		%				$	2,063		1.0		%

			Nine Months Ended September 30,
			2022									2021
$ in millions			Average Daily Balance			Interest			Annualized Average Rate			Average Daily Balance			Interest			Annualized Average Rate
Interest earning assets
Investment securities1			$	169,926		$	2,261		1.8		%	$	182,804		$	2,100		1.5		%
Loans1			201,655			4,469			3.0		%	161,422			3,091			2.6		%
Securities purchased under agreements to resell2,3:
U.S.			56,451			719			1.7		%	55,248			64			0.2		%
Non-U.S.			62,273			151			0.3		%	53,813			(211)			(0.5)		%
Securities borrowed2,4:
U.S.			124,628			167			0.2		%	95,737			(610)			(0.9)		%
Non-U.S.			19,819			(70)			(0.5)		%	17,247			(142)			(1.1)		%
Trading assets, net of Trading liabilities5:
U.S.			74,993			1,418			2.5		%	76,456			1,230			2.2		%
Non-U.S.			14,668			304			2.8		%	19,103			291			2.0		%
Customer receivables and Other6:
U.S.			116,515			2,396			2.7		%	135,596			1,035			1.0		%
Non-U.S.			76,649			548			1.0		%	74,527			152			0.3		%
Total			$	917,577		$	12,363		1.8		%	$	871,953		$	7,000		1.1		%
Interest bearing liabilities
Deposits1			$	340,166		$	684		0.3		%	$	322,304		$	330		0.1		%
Borrowings1,7			228,589			2,990			1.7		%	221,875			2,030			1.2		%
Securities sold under agreements to repurchase2,8,10:
U.S.			20,957			487			3.1		%	30,559			122			0.5		%
Non-U.S.			39,694			238			0.8		%	25,722			(40)			(0.2)		%
Securities loaned2,9,10:
U.S.			6,354			21			0.4		%	4,776			7			0.2		%
Non-U.S.			7,308			319			5.8		%	5,195			272			7.0		%
Customer payables and Other11:
U.S.			144,691			311			0.3		%	129,883			(1,349)			(1.4)		%
Non-U.S.			75,510			305			0.5		%	73,415			(328)			(0.6)		%
Total			$	863,269		$	5,355		0.8		%	$	813,729		$	1,044		0.2		%
Net interest income and net interest rate spread						$	7,008		1.0		%				$	5,956		0.9		%

1.Amounts include primarily U.S. balances.

2.Certain prior period amounts have been reclassified to conform to the current presentation.

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

4.Includes fees paid on Securities borrowed.

5.Excludes non-interest earning assets and non-interest bearing liabilities, such as equity securities.

6.Includes Cash and cash equivalents.

7.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.

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

9.Includes fees received on Securities loaned.

10.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.

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

September 2022 Form 10-Q			70

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Glossary of Common Terms and Acronyms

2021 Form 10-K			Annual report on Form 10-K for year ended December 31, 2021 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
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)
CRM			Credit Risk Management Department
CTA			Cumulative foreign currency translation adjustments
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 banks
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
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
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
SOFR			Secured Overnight Financing Rate
S&P			Standard & Poor’s
SPE			Special purpose entity
SPOE			Single point of entry
TDR			Troubled debt restructuring
TLAC			Total loss-absorbing capacity
U.K.			United Kingdom
UPB			Unpaid principal balance
U.S.			United States of America
U.S. GAAP			Accounting principles generally accepted in the United States of America
VaR			Value-at-Risk
VIE			Variable interest entity
WACC			Implied weighted average cost of capital
WM			Wealth Management

			71			September 2022 Form 10-Q

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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

The following developments have occurred since previously reporting certain matters in the Firm’s 2021 Form 10-K and the Firm’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2022 (the “First Quarter Form 10-Q”) and the quarterly period ended June 30, 2022 (the “Second Quarter Form 10-Q”). See also the disclosures set forth under “Legal Proceedings” in the 2021 Form 10-K, the First Quarter Form 10-Q, and the Second Quarter Form 10-Q.

Residential Mortgage and Credit Crisis Matters

On October 4, 2022, the parties in Deutsche Bank National Trust Company, as Trustee for the Morgan Stanley ABS Capital I Inc. Trust, Series 2007-NC1 v. Morgan Stanley ABS Capital I, Inc. reached an agreement in principle to settle the litigation.

On October 4, 2022, the parties in Deutsche Bank National Trust Company, solely in its capacity as Trustee for Morgan Stanley ABS Capital I Inc. Trust, Series 2007-NC3 v. Morgan Stanley Mortgage Capital Holdings LLC, as Successor-by-Merger to Morgan Stanley Mortgage Capital Inc. reached an agreement in principle to settle the litigation.

Record Keeping Matter

On September 27, 2022, the Firm’s settlements with the SEC and the CFTC to resolve record-keeping related investigations by those agencies relating to business communications on unapproved messaging platforms became effective.

European 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.

Risk Factors

For a discussion of the risk factors affecting the Firm, see “Risk Factors” in Part I, Item 1A of the 2021 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
July			7,024,977			$	81.08		6,966,721			$	19,435
August			14,511,783			$	87.32		13,954,929			$	18,215
September			8,881,353			$	86.91		8,860,100			$	17,445
Three Months Ended September 30, 2022			30,418,113			$	85.76		29,781,750

1.Includes 636,363 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 September 30, 2022.

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 27, 2022, the Firm announced that its Board of Directors approved a new multi-year repurchase authorization of up to $20 billion of outstanding common stock, without a set expiration date, beginning in the third quarter of 2022, 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.

September 2022 Form 10-Q			72

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Exhibits

Exhibit No.			Description
15			Letter of awareness from Deloitte & Touche LLP, dated November 3, 2022, 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: November 3, 2022

			73			September 2022 Form 10-Q