Morgan Stanley projected it may be able to reach its return-on-equity goals for fixed income trading despite revenue decline below USD6 billion. This amount is the average revenues for the bank according to its Chief Financial Officer Ruth Porat.

The expense cuts and reductions in risk weighted assets would be able to produce its return on equity for its business above the firm's cost of equity even with annual revenue of below USD6 billon. This was confirmed by Porat through a conference call held earlier.

She said that the bank's cost of equity was at 10% and it had posted fixed income revenues worth USD6 billion for the past three years.

According to Porat, "The main thing is controlling that which we control to drive ROEs greater than the cost of capital within fixed income. If it's one metric to stay focused on, it's the ROE. That's the way we're managing the business."