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Morgan Stanley expects to take a US$1.25bn fourth quarter hit from the US tax reform bill

The Wall Street bank said in a regulatory filing that its net income for the quarter will include a tax provision of that amount, primarily stemming from the re-evaluation of certain net deferred tax assets using the lower tax rate

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Morgan Stanley (NYSE:MS) said it expects to take a US$1.25bn fourth quarter hit from the US tax reform bill that was signed into law in December.

The Wall Street bank said in a regulatory filing that its net income for the quarter will include a tax provision of that amount, primarily stemming from the re-evaluation of certain net deferred tax assets using the lower tax rate.

Rival Goldman Sachs Group Inc.(NYSE:GS) announced in late December that it estimates the new tax legislation could reduce its fourth quarter earnings by about US$5bn, mainly due to the newly enacted repatriation tax for cash and assets held overseas.

In pre-market New York trading, Morgan Stanley shares edged higher, up 0.1% at US$53.17.