A deal to combine the brokerages of Citigroup and Morgan Stanley would not only give Citi much-needed cash, it would also give Morgan Stanley more manpower, analysts said. “If Morgan and Citi get together, they would be able to put together a retail brokerage unit that is larger than Merrill’s thundering herd, which could position them well in the marketplace,†said Chris Probyn, chief economist at State Street Global Advisors. “This may be a way of staying competitive.†The move would also be beneficial to Morgan Stanley as it looks to build its less-risky, lower leveraged businesses after becoming a bank holding company. The move would also provide Morgan Stanley a greater sales force to build its growing retail deposit based, which has been among the bank’s top priorities in recent months, Lauren Smith, an analyst with Keefe, Bruyette & Woods Inc. wrote in a research note Monday.
$5.925 (01/12/09)
