MUFG, Morgan Stanley JV to post $1.7 billion annual net loss

By @ibtimes on

A Japanese securities joint venture between Mitsubishi UFJ Financial Group (MUFG) <8306.T> and Morgan Stanley said it will report a net loss of 145 billion yen ($1.7 billion) for the year ended March due to trading losses.

The venture, Mitsubishi UFJ Morgan Stanley Securities, also said on Wednesday it plans to raise 30 billion yen from Mitsubishi UFJ Securities Holdings.

Mitsubishi UFJ Morgan Stanley Securities, is 60 percent owned by MUFG and 40 percent owned by Morgan Stanley.

It is one of two securities ventures formed between MUFG and Morgan Stanley after Japan's largest lender acquired a 21 percent stake in the Wall Street firm for $9 billion in 2008.

Mitsubishi UFJ Morgan Stanley Securities (MUMSS) was set up in May last year by combining Mitsubishi UFJ's domestic brokerage business and Morgan Stanley's investment banking operation in Japan.

The other venture, Morgan Stanley MUFG Securities (MSMS), is made up of Morgan Stanley's sales, trading and capital markets divisions.

In an interview in January, Katsunori Nagayasu, president of MUFG, said the financial group would step up efforts to turn around the loss-making joint venture.

MUFG has 60 percent of economic interest and Morgan Stanley has 40 percent in MSMS.

(Reporting by Taiga Uranaka; Editing by Matt Driskill)

Join the Discussion