Morgan Stanley Deferred Awards for 2013 Hit $2.72 Billion

Morgan Stanley (MS), owner of the world’s largest brokerage, gave employees $2.72 billion in deferred awards for 2013 performance as the firm disclosed the amount for the first time.

The bank will recognize $1.74 billion of the awards this year, assuming no forfeitures, cancellations or accelerations, the firm said yesterday in an annual regulatory filing. Morgan Stanley also may face $831 million of costs in 2014 from previous awards.

Morgan Stanley, which deferred 100 percent of 2012 bonuses for many senior bankers, paid some portion of awards for last year’s performance in immediate cash. The bank still deferred at least half of bonuses for any employees who have both total pay of at least $350,000 and incentive pay of $50,000, a person familiar with the matter said last month.

The total cost of deferred awards in 2014 may be as much as $2.57 billion, excluding costs tied to returns on investments made with deferred cash. That’s equal to 2013’s result on the same basis. The final number will probably be lower as employees leave before their stock and cash vest.

Employees who got deferred equity awards over the last two years have benefited as Morgan Stanley’s stock doubled, including a 64 percent jump in 2013.

To contact the reporter on this story: Michael J. Moore in New York at mmoore55@bloomberg.net

To contact the editor responsible for this story: Peter Eichenbaum at peichenbaum@bloomberg.net

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