NEW YORK - Earnings at Merrill Lynch & Co., the largest U.S. securities firm, rose 34% in the second quarter, led by gains from trading and investment banking.
The firm said it will split its stock, after a 55% surge this year.
Merrill's net income was $902 million, or $2.01 a share, compared with $673 million, or $1.57 a share, in the previous quarter. Net revenue increased 24%, to $6.7 billion.
Concern over slowing asset growth - in both its online and traditional accounts - reversed an early jump in the shares. The firm's $18 billion of inflows were less than half that gained by Charles Schwab Corp., its biggest brokerage rival. Merrill stock fell $3.71875, or 2.82% to close at $128.25 Tuesday.
"The only thing you could point your finger at was the lack of growth in asset gathering," said Guy Moszkowski, a Salomon Smith Barney analyst. "A lot of people follow the Schwab-Merrill asset gathering horse race."
Merrill became the latest big securities firm to post bigger-than-expected results in a quarter when benchmark stock indexes sank, slowing trading and investment banking. While Goldman Sachs Group Inc., Lehman Brothers Holdings Inc., and Morgan Stanley Dean Witter & Co. increased their share of business abroad, Merrill beefed up its U.S. businesses.