UPDATE 2-More analysts see Morgan Stanley posting Q2 loss
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BANGALORE, June 24 (Reuters) - Citigroup and JMP Securities on Wednesday joined a group of analysts predicting a second-quarter loss at Morgan Stanley (MS.N: Cotización), citing charges from repayment of government funds, but the analysts took comfort about the Wall Street firm's long-term prospects.
On Tuesday, FBR Capital Markets had reversed its second-quarter earnings estimate for Morgan Stanley to a loss.
Citigroup analyst Keith Horowitz expects Morgan Stanley's second-quarter results to be "messy," and said the company's $5 billion of gross commercial real estate equity exposure is a risk.
Morgan Stanley may post a "large loss" in the second quarter, weighed down by charges related to the repayment of government bailout funds, said Horowitz, who also forecast a 2009 loss for the company.
Banks are returning money taken from the $700 billion Troubled Asset Relief Program, which was once intended to spur lending but is now viewed as a sign that recipients are too weak to survive on their own.
In connection with the early repayment and associated dividends, several banks are taking second-quarter charges.
Goldman Sachs said it paid a dividend of $425 million, which will reduce second-quarter earnings by about 77 cents a share, while Morgan Stanley said it expects a $892 million charge in the second quarter related to the early repayment. Continuación...