Profit surge for securities firms

Profit surge for securities firms

MORGAN STANLEY Dean Witter & Co and Lehman Brothers Holdings each reported record second-quarter earnings, led by a surge in corporate takeovers and stock and bond sales.

Morgan, the second-biggest US securities firm, said earnings for the three months ended 31 May rose by 45 per cent, while net income at Lehman, the fourth largest, more than doubled. Both trounced analysts' forecasts.

Profits in the securities industry in the US are running at a record pace for a third year. More than $1,000bn of announced mergers and $450bn of securities sales lifted investment banks' fees.