Morgan Stanley slumped to a surprising third-quarter loss yesterday, thanks in part to writedowns on the stalled Revel Casino project in Atlantic City, New Jersey.
The investment bank, one of a number attacked by critics of "casino capitalism", took a $229m (£146m) hit from costs associated with pulling out of the venture. It still holds a $40m stake in the Revel development, however.
Morgan said its net losses for the three months to the end of September came in at $91m. Earnings were also hit by tough conditions in investment banking which have seen profits fall across the sector.
Earnings from the continuing operations were $313m – 67 per cent lower than in the same period last year. Revenues were also down by a fifth, with the Wall Street bank blaming weak trading volumes and a slowdown in the bonds market. As with Goldman Sachs, the bonus pool will be reduced as a result, although billions have still been set aside.Reuse content