The decline in net revenues occurred due to the loss from continuing operations which stood at $78m, or a loss of $0.05 per diluted share compared to income of $984m, or $0.51 per diluted share, during the same period previous year, the firm said.

For the latest quarter period, net revenues excluding DVA were $8.9bn versus $7.8bn a year ago and income from continuing operations applicable to Morgan Stanley stood at $1.4bn, or $0.71 per diluted share, against $1.1bn, or $0.59 previous year.

Morgan Stanley chairman and chief executive officer James Gorman said that the quarter was a further evidence that Morgan Stanley has rebounded from the financial crisis of 2008 and is in a significantly stronger position.

"Revenues of $8.9 billion, excluding the impact of DVA, were higher on both a year-over-year and a quarter-over-quarter basis. Of particular note was the strength in sales and trading, which showed broad-based gains across products and regions", Gorman said.

"In addition, our global alliance with MUFG continues to strengthen, with improving operating performance in our securities joint venture in Japan and continued loan growth in the U.S. On the near horizon, we are intensely focused on completing the transition of Morgan Stanley Smith Barney to the new, state-of-the-art technology platform this summer, as well as maintaining a conservative capital and liquidity profile as we navigate global markets."

The company’s current quarterly financial result also indicated that its net loss applicable including discontinued operations was $0.06 per diluted share, compared to net income of $0.50 per diluted share in the first quarter of last fiscal.

Institutional Securities segment reported a pre-tax loss from continuing operations of $312m against a pre-tax income of $432m in the first quarter of 2011, while net revenues stood at $3bn compared to $3.6bn a year ago.

For the quarter ended 31 March 2012, its global wealth management group registered pre-tax income from continuing operations of $387m compared to $344m quarter-over-quarter during the same period last year.

Asset Management registered a pre-tax income of $128m from continuing operations against $125m during the corresponding period of 2011.