The Federal Reserve's September rate hike could provide another earnings tailwind for Morgan Stanley's Wealth Management business, with the 25-basis-point increase in the federal funds target range to 3.75-4.00% potentially supporting yields on client cash and lending balances and lifting net interest income. Morgan Stanley enters the higher-rate backdrop from a position of strength, as Wealth Management revenues rose 15% year over year to $17.4 billion in the first half of 2026 while net interest income increased 16% to $4.4 billion, and asset management revenues climbed 17% to $10.3 billion. Net new assets reached a record $266.5 billion during the period. Even before the Fed's September move, Morgan Stanley had expected a modest sequential rise in Wealth Management net interest income in the third quarter, with further improvement supported by loan growth and deposit mix. The benefits are unlikely to be entirely one-sided, however, since higher deposit costs could limit spread expansion and persistently elevated rates could soften lending demand and pressure equity and bond valuations. Among peers, JPMorgan's Asset & Wealth Management business posted first-half revenues up 15% year over year to $13.2 billion with assets under management of $5.14 trillion, up 18%, while Goldman Sachs' Asset & Wealth Management revenues rose 15% year over year to $8.7 billion even as private banking and lending revenues declined on a lower net interest margin tied to Marcus deposits.
Morgan StanleyFed's 25bp rate hike to 3.75-4.00% could support yields on client cash and lending balances, lifting Morgan Stanley Wealth Management net interest income.
Goldman Sachs Group Inc
Wealth Management Inc
JPMorgan Chase & Co