Morgan Stanley Eyes Smaller Fish to Boost Banking Cred

After converting from investment bank, company targets growth in deposits
By Jim O'Neill,  Newser User
Posted Dec 1, 2008 10:27 AM CST
Traffic passes Morgan Stanley headquarters, Sept. 22, 2008, in New York.   (AP Photo)
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(Newser) – Just months after converting from an investment firm into a bank-holding company, Morgan Stanley is already one of the top 50 US banks in terms of deposits, the Wall Street Journal reports—and is looking to acquire regional banks that will speed its climb. Analysts say it’s unlikely Morgan Stanley will move to turn its current brokerage offices into bank branches.

Morgan Stanley will need the customers of established banks—and their branches and ATMs—to reach the deposit base it needs. And it wants to improve its balance sheet by increasing deposits, equity, and long-term debt to 50% from its current 33%. “The external environment seems to be aligned for us to become bigger in this space,” one exec says.