Morgan Stanley Europe Holding SE
Group Annual Report 2023
Registered number: HRB 109678
Registered office: Grosse Gallusstrasse 18 60312 Frankfurt am Main
TABLE OF CONTENTS (1) | |
GROUPMANAGEMENT REPORT | |
Group Overview | |
Supervision and Authorisations | |
Capital Management | |
Risk Report | 12 |
Risk Management Framework | 12 |
Internal Capital Adequacy Assessment Process | 16 |
Credit Risk | 18 |
Market Risk | 20 |
Liquidity Risk | 22 |
Operational Risk | 24 |
Model Risk | 25 |
Conduct Risk | 26 |
Compliance Risk | 26 |
Other Material Risks | 27 |
Risk Summary | 27 |
Opportunities and Outlook | 29 |
Regulatory Developments | 29 |
ESG Report | 31 |
Approach to ESG | 31 |
Human Capital | 32 |
Climate and Environment | 34 |
Solutions and Services | 41 |
Sustainability Governance and Risk Management | 42 |
- Please note that the English version of the Consolidated Financial Statements and Group Management Report as at 31 December 2023 is a convenience translation. Deloitte GmbH Wirtschaftprüfungsgesellschaft, Frankfurt am Main, issued the Independent Auditors' Report only for the German version of the Consolidated Financial Statements and the Group Management Report as at 31 December 2023. Therefore, the German version prevails.
CONSOLIDATED FINANCIAL STATEMENTS | 46 | |
Consolidated Income Statement | 47 | |
Consolidated Statement of Comprehensive Income | 48 | |
Consolidated Statement of Changes in Equity | 49 | |
Consolidated Statement of Financial Position | 50 | |
Consolidated Statement of Cash Flows | 51 | |
Notes to the Consolidated Financial Statements | 52 | |
1. | Corporate Information | 53 |
2. | Basis of Preparation | 53 |
3. | Summary of Material Accounting Policies | 55 |
4. | Net Gains from Financial Instruments at Fair Value through Profit or Loss | 64 |
5. | Fee and Commission Income | 64 |
6. | Interest Income and Interest Expense | 65 |
7. | Operating Expense | 65 |
8. | Income Tax | 65 |
9. | Financial Assets and Financial Liabilities by Measurement Category | 66 |
10. | Trading Financial Assets and Liabilities | 68 |
11. Derivatives | 69 | |
12. | Trade and Other Receivables | 70 |
13. | Investments in Subsidiaries | 70 |
14. | Trade and Other Payables | 71 |
15. | Debt and Other Borrowings | 71 |
16. | Provisions, Contingent Liabilities and Commitments | 71 |
17. | Deferred Tax Assets and Liabilities | 73 |
18. | Equity Instruments | 73 |
19. Additional Cash Flow Information | 74 | |
20. | Expected Maturity of Assets and Liabilities | 76 |
21. | Financial Risk Management | 77 |
22. | Transfers of Financial Assets, including Pledges of Collateral | 83 |
23. | Financial Assets Accepted as Collateral | 84 |
24. | Financial Assets and Financial Liabilities Subject to Offsetting | 84 |
25 Financial Instruments Measured at Fair Value | 86 | |
26. Assets and Liabilities not Measured at Fair Value | 93 | |
27. | Employee Compensation Plans | 93 |
28. | Post-EmploymentBenefits | 94 |
29. | Related Party Disclosures | 97 |
30. | Country by Country Reporting | 100 |
Appendix to the ESG Report | 102 | |
Independent Auditor's Report | 118 | |
Report of the Supervisory Board in Accordance with Sec. 171 (2) and 314 (2) of the German Stock | ||
Corporation Act (AktG) | 122 |
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MORGAN STANLEY EUROPE HOLDING SE
GROUP MANAGEMENT REPORT
Year ended 31 December 2023
BILANZ
GROUP
MANAGEMENT
REPORT
Group Overview
Risk Report
Opportunities and Outlook
ESG Report
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MORGAN STANLEY EUROPE HOLDING SE
GROUP MANAGEMENT REPORT
Year ended 31 December 2023
Group Overview
The Morgan Stanley Europe Holding SE Group (the "Group" or the "MSEHSE Group") is Morgan Stanley's primary hub to facilitate European Union clients' ("EU27 clients") business. The Group's business strategy is closely integrated into the global strategy of Morgan Stanley's Institutional Securities Group ("ISG"). The Group's principal business units within ISG are the Institutional Equities Division ("IED"), the Fixed Income Division ("FID"), the Investment Banking Division ("IBD") and Global Capital Markets ("GCM").
In executing Morgan Stanley's ISG strategy, the Group is a key contributor in the following areas:
- sales, trading, financing and market-making activities in equity and fixed income products, including foreign exchange and commodities;
- financial advisory services, including advice on mergers, acquisitions and restructurings;
- corporate lending; and
- capital raising.
The Group makes global products available to EU27 clients, and also provides EU27 products to global clients via other Morgan Stanley entities. Market making activities such as Euro interest rate swaps, European Union ("EU") government bonds, Euro inflation swaps, Covered Bonds, automated market-making of European equity stocks (for EU exchanges) are market risk managed within the Group. In alignment with its business strategy and regulatory expectations, in 2023, the Group increased its market risk management capabilities in certain EU products and plans to further expand its capabilities in 2024.
Corporate Structure
Morgan Stanley Europe Holding SE, Frankfurt am Main ("MSEHSE") is authorised by the European Central Bank ("ECB") as a financial holding company in accordance with Section 2f
- and (3) of the German Banking Act (Kreditwesengesetz or "KWG"). MSEHSE is a superordinated undertaking in accordance with Section 10a (2) of the KWG. MSEHSE coordinates the strategy and the management of the financial resources of its subsidiaries.
MSEHSE directly holds 100% of the shares in Morgan Stanley Europe SE, Frankfurt am Main ("MSESE"), which in turn directly holds 100% of
the shares in Morgan Stanley Bank AG, Frankfurt am Main ("MSBAG"). MSESE operates branches in France, Italy, the Netherlands, Poland, Spain, Sweden and Denmark.
There are control agreements (Beherrschungs- verträge) in place between MSEHSE and MSESE and between MSESE and MSBAG which include loss compensations in accordance with Section 302 of the German Stock Corporation Act (Aktiengesetz or "AktG"). Letters of Comfort are provided by MSEHSE to benefit MSESE and MSBAG as well as by MSESE to benefit MSBAG. A Profit and Loss Transfer Agreement exists between MSESE and MSBAG. As a result, MSESE and MSBAG form an income tax group (Ertragsteuerliche Organschaft) in accordance with the Corporation Tax Act (Körperschaftsteuergesetz).
MSEHSE is the sole shareholder of Morgan Stanley France Holdings I S.A.S., France ("MSFH I") with its subsidiaries Morgan Stanley France Holdings II S.A.S., France ("MSFH II") and Morgan Stanley France S.A., France ("MSF"). MSFH I, an investment holding company and MSFH II, a holding company, are parent undertakings of MSF.
MSEHSE is a wholly owned subsidiary of Morgan Stanley International Limited, London, United Kingdom ("MSI"). MSEHSE's ultimate parent undertaking and controlling entity is Morgan Stanley, Delaware, United States of America ("US"). Morgan Stanley is a global financial services firm authorised as a Financial Holding Company and regulated by the Board of Governors of the Federal Reserve System in the US. All companies of the MSEHSE Group are fully integrated into the global Morgan Stanley Group (the "Morgan Stanley Group").
Supervision and Authorisations
MSESE and MSBAG are subject to joint supervision by the ECB, the Federal Financial Supervisory Authority ("BaFin") and the Deutsche Bundesbank. MSF and MSFH I are subject to supervision by the Autorité de Contrôle Prudentiel et de Résolution, Paris. MSFH II is not subject to regulatory supervision.
MSESE is conditionally registered with the Securities and Exchange Commission ("SEC") as a Securities Based Swap Dealer ("SBSD"). MSESE is complying with home country capital
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MORGAN STANLEY EUROPE HOLDING SE
GROUP MANAGEMENT REPORT
Year ended 31 December 2023
requirements in lieu of SEC capital requirements pursuant to applicable substituted compliance rules.
MSESE is also registered with the Commodity Futures Trading Commission ("CFTC") as a Swap Dealer.
MSESE is a Capital Requirements Regulation ("CRR") credit institution (Class 1 Investment Firm). MSESE is not authorised to provide either deposit taking services or lending.
MSBAG is a CRR credit institution and has a full banking licence. MSBAG is an integral part of the Morgan Stanley Group's Euro liquidity management, operates a lending business and acts as a securities settlement service provider for the Group.
MSF is a Class 2 investment firm in accordance with the Investment Firms Regulation ("IFR") that provides financial services to a client base, primarily in France, consisting of corporations, governments and financial institutions.
As of 31 December 2023, MSEHSE is designated by the European Commission as an Intermediate Parent Undertaking ("IPU"). MSEHSE, already supervised on a consolidated basis, is now formally subject to IPU
requirements which mandate single consolidated supervision of a third-country Group's EU activities, as opposed to individual supervision of several standalone entities.
Economic Report
Business Environment
The Group Management Report contains certain forward-looking statements. These statements are made by the Management Board in good faith, based on the information available at the time of the approval of this report and such statements should be treated with caution due to the inherent uncertainties, including both economic and business risk factors, underlying any such forward-looking information.
The market environment in aggregate for much of 2023 remained mixed, characterised by inflationary pressures and uncertainty regarding the future path of interest rates, which have remained high. Towards the end of the year, the market environment has improved somewhat with the expectation of lower interest rates into 2024. However, there remains uncertainty regarding the timing and pace of the rate reductions along with concerns regarding heightened geopolitical risks that could impact capital markets in 2024. This environment has impacted the performance of the Group. Despite the challenging market conditions, the Group's performance remained solid in 2023 although reported profitability was below forecast expectations. To the extent that the business environment continues to remain uncertain it could further adversely impact client confidence and related activity.
Global Markets and Economic Conditions
Growth in global Gross Domestic Product ("GDP") has weakened in 2023. Throughout the year, the main macroeconomic factors that have weighed on growth globally have been the restrictive monetary policy introduced by central banks to curb the record-high inflation and a reversal of the manufacturing cycle after its strong rebound post-pandemic. The euro area economy saw subdued growth, with considerable heterogeneity across countries. Weak global trade, consequences of energy supply shocks, and restrictive monetary policy have all been a drag on growth in the euro area.
The policy mix in 2023 has been a continuation of the one of late 2022. Fiscal policy measures in the euro area remained accommodative as governments spent generously on energy- related measures. The monetary policy tightening accelerated in 2023, with the ECB entering into restrictive territory. Further tightening was seen across other regions as well, as central banks tried to bring inflation back to target and avoid inflation expectations getting entrenched at elevated levels.
In the euro area, the ECB ended reinvestments under its Asset Purchase Programme in June 2023. The ECB kept raising rates until September 2023, reaching a deposit facility rate of 4.0%. Fiscal deficits in 2023 are expected to remain above 3%, reaching (an estimated) 3.3% of euro area GDP. Euro area inflation reached 5.5% in 2023, driven by increasing core inflation.
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MORGAN STANLEY EUROPE HOLDING SE
GROUP MANAGEMENT REPORT
Year ended 31 December 2023
After a peak at 10.6% in October 2022 headline inflation declined rapidly throughout the year to 2.9% in December 2023.
War in the Middle East
The Group continues to monitor the war and increased tensions in the Middle East and its impact on the regional economy, as well as on other world economies and the financial markets.
Net Assets, Financial Position and Results of Operations
Consolidated Income Statement
Set out below is an overview of the financial results for the years 2023 and 2022.
2023 | 2022 | Increase/ | Variance | |
€ in millions | (decrease) | % | ||
Sales and trading | 750 | 554 | 196 | 35% |
Investment banking | 156 | 205 | (49) | (24%) |
Lending | 94 | 59 | 35 | 59% |
Other | 48 | 129 | (81) | (63%) |
Net revenues | 1,048 | 947 | 101 | 11% |
Staff related | 413 | 370 | 43 | 12% |
expenses | ||||
Non-staff related | 371 | 336 | 35 | 10% |
expenses | ||||
Operating | 784 | 706 | 78 | 11% |
expenses | ||||
Net impairment | 1 | (5) | 6 | (120%) |
reversal / (loss) | ||||
Profit before tax | 265 | 236 | 29 | 12% |
Income tax | 78 | 94 | (16) | (17%) |
expense | ||||
Profit after tax | 187 | 142 | 45 | 32% |
Net Revenues
Sales and trading
Sales and trading income is comprised of commission and trading income. Commission income arises from arrangements in which the client is charged commission for executing and clearing transactions related to securities and other listed products. Trading income is derived from client activity and can be affected by a variety of interrelated factors, including market volumes, bid-offer spreads and the impact of market conditions on inventory held to facilitate client activity.
Although sales and trading revenues in 2023 increased compared to 2022 as the business benefited from higher interest rates and increased market risk management, the performance remained below forecast expectations.
Investment banking
Investment banking fee income is derived from client engagements in which the Group acts as an advisor in relation to mergers and acquisitions, divestitures and corporate restructurings, underwriter of equity and fixed income securities or distributor of capital.
Investment banking revenues in 2023 decreased compared to 2022, reflecting lower advisory revenues driven by fewer completed M&A transactions in the Morgan Stanley Group on lower market volumes.
Lending
Lending income is generated by extending loans and credit commitments to clients as well as by loan trading. The Group's lending revenues increased compared to 2022 as the business benefited from higher interest rates partially offset by a subdued performance of the core lending activities.
Other
Other revenues in 2023 result primarily from an interest spread of €40 million earned on deposits from other Morgan Stanley Group undertakings which are subsequently deposited at the Deutsche Bundesbank.
The decrease from the prior year is primarily a result of gains recognised from the sale of the Real Assets business unit in 2022.
Operating Expenses
Staff related expenses
Staff related expenses include base salaries and fixed allowances, discretionary incentive compensation, amortisation of deferred cash and equity awards, severance costs and other items including health and welfare benefits.
Staff related expenses increased in 2023 compared to 2022. This was driven by higher salary expenses and severance costs primarily associated with the employee action recorded in the second quarter of 2023.
Non-staff related expenses
Non-staff related expenses include brokerage fees, administration and corporate services, professional services, transaction taxes and management charges from other Morgan Stanley Group undertakings relating to other services.
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MORGAN STANLEY EUROPE HOLDING SE
GROUP MANAGEMENT REPORT
Year ended 31 December 2023
Non-staff related expenses increased in 2023 compared to 2022, driven by increased legal advice and transaction-related expenses.
Income Tax Expense
The Group's tax expense for the period is €78 million, compared to €94 million for the prior year. The main drivers for the lower tax expense in 2023 are the geographic mix of profits and tax rates in jurisdictions outside Germany, as well as the release of prior year tax reserves.
Consolidated Statement of Financial Position
Set out below is an overview of the consolidated statement of financial position for the years 2023 and 2022.
Vari- | ||||
Increase/ | ance | |||
€ in millions | 2023 | 2022 | (decrease) | % |
Cash and short | 9,982 | 16,125 | (6,143) | (38%) |
term deposits | ||||
Trading financial | 49,843 | 58,821 | (8,978) | (15%) |
assets | ||||
Secured financing | 29,575 | 18,267 | 11,308 | 62% |
Trade and other | 16,927 | 25,474 | (8,547) | (34%) |
receivables | ||||
Other assets | 384 | 290 | 94 | 32% |
TOTAL ASSETS | 106,711 | 118,977 | (12,266) | (10%) |
Bank loans and | 3,892 | 7,632 | (3,740) | (49%) |
overdrafts | ||||
Trading financial | 52,457 | 61,051 | (8,594) | (14%) |
liabilities | ||||
Secured | 22,797 | 18,446 | 4,351 | 24% |
borrowing | ||||
Trade and other | 16,222 | 21,281 | (5,059) | (24%) |
payables | ||||
Debt and other | 3,776 | 4,125 | (349) | (8%) |
borrowings | ||||
Other liabilities | 75 | 81 | (6) | (7%) |
TOTAL | 99,219 | 112,616 | (13,397) | (12%) |
LIABILITIES | ||||
TOTAL EQUITY | 7,492 | 6,361 | 1,131 | 18% |
TOTAL | 106,711 | 118,977 | (12,266) | (10%) |
LIABILITIES | ||||
AND EQUITY | ||||
Contingent | 5 | 7 | (2) | (29%) |
liabilities | ||||
Commitments | 71,374 | 13,649 | 57,725 | 423% |
Cash and short-term deposits and Bank loans and overdrafts
The decrease in 'Cash and short-term deposits' and 'Bank loans and overdrafts' is driven primarily by lower deposits received from other Morgan Stanley Group undertakings which are deposited at the Deutsche Bundesbank.
Trading financial assets and liabilities
'Trading financial assets' and 'Trading financial liabilities' primarily consists of derivatives and government bonds. The decrease compared to the prior year is driven by market movements on exchange and interest rates and the implementation of additional settlement techniques for certain cleared derivatives. This is partially offset by an increase in European government bond inventory.
Secured financing and borrowing
The increase in 'Secured financing' and 'Secured borrowing' is primarily driven by an increase in securities sourcing for the Group's own use, and on behalf of other Morgan Stanley Group undertakings.
Trade and other receivables and payables
The decrease in 'Trade and other receivables' and 'Trade and other payables' is primarily driven by lower amounts of cash collateral pledged and received in relation to fair value movements in over-the-counter ("OTC") derivatives.
Equity structure
Total Equity increased from €6,361 million to €7,492 million during the financial year. Refer to the section "Capital Management" for further details.
Total equity of €7,492 million at 31 December 2023 consists of ordinary shares issued totalling €4,650 million, Additional Tier 1 ("AT1") instruments issued of €1,000 million, capital reserves of €1,471 million and retained earnings of €371 million.
Commitments
The increase in Commitments is mainly due to an increase in forward-starting repo and reverse repo transactions compared to the prior year. This was driven by an increase in securities sourcing for the Group's own use, and on behalf of other Morgan Stanley Group undertakings.
Capital Management
The Group actively manages and monitors its capital in line with established policies and procedures and in compliance with local regulatory requirements.
Effective 1 January 2023, MSESE has been granted a Capital waiver in accordance with Article 9 of the CRR, allowing its capital requirements to be met on an individual
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MORGAN STANLEY EUROPE HOLDING SE
GROUP MANAGEMENT REPORT
Year ended 31 December 2023
consolidated basis (MSESE incorporating its subsidiary MSBAG, "MSESE Consol"). MSBAG has been granted a Capital waiver in accordance with Article 7 of the CRR and therefore its capital requirements are met at the MSESE Consol level. Capital requirements are managed at both the MSEHSE Group level and at the MSESE Consol level.
Consistent with the Morgan Stanley Group's capital management policies, the Group manages its capital position based upon, among other things, business opportunities, risks, capital availability and rates of return together with internal capital policies, regulatory requirements and rating agency guidelines.
Regulatory Capital
The Group is subject to minimum capital requirements as calculated in accordance with the CRR and the Capital Requirements Directive (Directive 2013/36/EU or "CRD") as transposed into German Law.
The Group conducts an Internal Capital Adequacy Assessment Process ("ICAAP") at least quarterly in order to meet its obligations under CRD and the requirements of the ECB. The ICAAP is a key information tool for the Group Management Boards to approve capital adequacy targets and limits, establish ongoing monitoring processes and internal thresholds, and review identified risks in line with the business strategy. Refer to the section "Risk Report" for further information on the ICAAP.
The Joint Supervisory Team ("JST") with representatives of ECB, BaFin and Deutsche Bundesbank reviews the ICAAP through its Supervisory Review and Evaluation Process ("SREP") and sets a Total SREP Capital Requirement ("TSCR"), comprising of Pillar 1 and Pillar 2 Requirements ("P2R") and Pillar 2 Guidance ("P2G"), which establishes the minimum level of regulatory capital for the Group. As of 31 December 2023, the Total Capital requirement of the Group was 10.75% of Risk Weighted Assets ("RWAs") (2022: 10.75%) excluding capital buffers, with the individual P2R set at 2.75%.
The Capital Conservation Buffer ("CCB") requires banks to build up a capital buffer that can be utilised to absorb losses during periods of stress, whilst remaining compliant with minimum requirements, and must be met with Common Equity Tier 1 ("CET1") capital. As at 31 December 2023, the CCB remains at 2.5% (2022: 2.5%).
The Countercyclical Capital Buffer ("CCyB") was introduced to ensure that excessive growth in specific countries is accounted for by increasing minimum capital ratios by between 0% and 2.5% and must be met with CET1 capital. As of 31 December 2023, the CCyB for the Group was 0.7136% (2022: 0.3500%). The Group's CCyB is set to increase further in 2024 driven by announced increases in domestic and other European country CCyB rates. These changes are incorporated as part of the Group's capital planning and target setting processes.
Moreover, MSEHSE is subject to an additional capital buffer of 0.25% (to be met with CET1 capital) as it is categorised by the BaFin in consultation with the Deutsche Bundesbank as an Other Systemically Important Institution ("O- SII").
The regulatory capital resources managed by the Group include Tier 1 and Tier 2 instruments such as subordinated debt.
In 2023, the Group has undertaken further capital actions to strengthen its regulatory capital. In connection with the expansion of its business activities, in April 2023 the Group received €1,000 million of CET1 capital from MSI.
Refer to the section "Risk Report" for further details of the Group's Capital Resources.
The Pillar 3 Regulatory Disclosure Report of the MSEHSE Group as of 31 December 2023 is available at: https://www.morganstanley.com/about-us-ir.
Liquidity and Funding Management
The primary goal of the Group's liquidity and funding management framework is to ensure that the Group has sufficient liquidity to cover its
business operations and regulatory requirements, as well as access to adequate funding across a wide range of market conditions and time horizons. It manages resources mainly based on business opportunities, risks, availability and rates of return, which are driven by internal policies, regulatory requirements and rating agency guidelines.
MSESE and MSBAG have been granted a waiver in accordance with Article 8 of the CRR which permits liquidity requirements to be managed at the MSESE Consol level for MSESE and its subsidiary MSBAG as a sub- group. In addition to the MSESE Consol level,
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MORGAN STANLEY EUROPE HOLDING SE
GROUP MANAGEMENT REPORT
Year ended 31 December 2023
capital and liquidity requirements must also be managed at the MSEHSE Group level.
Liquidity Resources, Funding and Balance Sheet Management
The Group maintains sufficient liquidity resources to comply with internal liquidity stress testing and regulatory requirements. The total amount of Liquidity Resources is actively managed by the Group considering the following components:
- balance sheet size and composition;
- funding needs in a stressed environment inclusive of contingent cash outflows;
- collateral requirements; and
- regulatory requirements.
The amount of Liquidity Resources held is based on the Group's risk tolerance and is subject to change dependent on market and Group-specific events.
The Liquidity Resources consist of cash at central banks and high-quality unencumbered assets. Eligible unencumbered highly liquid securities include primarily Level 1 (as defined in the Commission Delegated Regulation (EU) 2015/61) government bonds and German sub- sovereign obligations.
Refer to the section "Risk Report" for further information on the Liquidity Risk framework, Liquidity framework and Liquidity Stress Tests.
Credit Ratings
The cost and availability of financing and cash collateral are impacted by the credit ratings of MSESE and MSBAG, among other variables. In addition, credit ratings can impact trading revenues, particularly in those businesses where longer-term counterparty performance is a key consideration, such as certain OTC derivative transactions. When determining credit ratings, rating agencies consider both company- specific and industry-wide factors. The Group's senior unsecured ratings are provided in the section "Non-financial key performance indicators".
Recovery and Resolution Planning ("RRP")
The Group prepares a recovery plan which identifies mitigation tools available to the Group in times of severe stress. The recovery plan is
updated on an annual basis and submitted to the ECB.
In terms of resolution planning, the Single Resolution Board ("SRB") as well as the BaFin as the national resolution authority are the responsible authorities for the Group. The Group produces information for the aforementioned authorities in the form of resolution reporting templates and ad-hoc regulatory submissions, in accordance with the EU statutory and regulatory requirements.
The Morgan Stanley Group has developed a resolution plan in accordance with the requirements of Section 165(d) of Title I of the Dodd-Frank Wall Street Reform and Consumer Protection Act and its implementing regulations adopted by the Federal Reserve Board and the Federal Deposit Insurance Corporation. The resolution plan presents the Morgan Stanley Group's strategy for resolution of the Morgan Stanley Group upon material financial distress or failure. Both MSESE and MSBAG are considered Material Operating Entities of the Morgan Stanley Group and are within the scope of the resolution strategy adopted by the Morgan Stanley Group.
Minimum Requirement for own funds and Eligible Liabilities ("MREL") and Total Loss Absorbing Capacity ("TLAC")
MREL serves to ensure that the Group has sufficient eligible liabilities in a resolution scenario to absorb losses and safeguard existing capital requirements. The BaFin, as the Group's national supervisor, shares the responsibility to determine MREL requirements with the SRB. The Group is subject to internal MREL requirements. MSESE Consol is also subject to MREL requirements from 1 January 2024.
With a similar objective, TLAC requirements serve to ensure that the Group has sufficient resources to absorb losses. TLAC is applied only at the Group level.
Financial and Non-financial Key Performance Indicators
The financial and non-financial key performance indicators ("KPIs") of the Group are aligned to its objective to further expand its business activities and strengthen performance, soundness and sustainability of the business considering regulatory requirements. To assess the effectiveness of the execution of the Group's strategy, a broad range of KPIs were set by the
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Morgan Stanley published this content on 14 May 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 14 May 2024 13:53:03 UTC.