On September 21, 2008 Morgan Stanley announced that the Federal Reserve had granted it bank holding status, giving it more flexibility to maneuver during the financial crisis gripping the economy. The status also means that it is subject to increased regulatory oversight under the Bank Holding Act.
Founded in 1935, Morgan Stanley is a global financial services firm headquartered in New York. As one of the top investment banks of it's kind, Morgan has offices in 35 countries with 600 global offices. Morgan's investment focus broke down to three divisions - institutional securities, global wealth management, and asset management.
One of the last remaining titans of Wall Street, the firm has seen increased pressure due to the current credit crisis. In 2007, Morgan twice wrote down the value of its subprime holdings totaling over $9 billion.
As of late September 2008, Morgan Stanley (along with Goldman Sachs) with assistance from the Federal Reserve, moved away from investment banking into a more traditional commercial banking role thus, asking for tighter government regulation. In October, with confidence still eroding on Wall Street, Morgan's stock value dropped 25 percent. On November 12, 2008 Morgan Stanley announced a 10 percent cut in the staff of the institutional securities division.