Fitch: Morgan Stanley Pressures Continue Despite MUFJ Capital Injection

While the closure of Morgan Stanley's equity investment from Mitsubishi UFJ (announced today) is a positive development that strengthens the bank's capital position and should address near-term equity market concerns, Fitch Ratings believes the recent stresses on Morgan Stanley's core businesses are likely to continue for the foreseeable future. As such, Fitch believes Morgan Stanley's credit risk profiles are more consistent with long-term ratings of 'A' and short-term ratings of 'F1.' Fitch has downgraded Morgan Stanley's long and short-term Issuer Default Ratings (IDRs) to 'A/F1' from 'AA-/F1+', reflecting continued expected challenges in profitability and funding despite the additional capital injection from Mitsubishi UFJ. Fitch's rating downgrade also takes into account the continued challenges Morgan Stanley faces in... [read full story]