22. Equity Method Investments.
The Company has investments accounted for under the equity method of accounting (see Note 1) of $4,746 million and $4,682 million at December 31, 2013 and December 31, 2012, respectively, included in Other investments in the consolidated statements of financial condition. Income (losses) from these investments were $375 million, $(23) million and $(995) million for 2013, 2012 and 2011, respectively, and are included in Other revenues in the consolidated statements of income. The gains (losses) for 2013, 2012 and 2011 were primarily related to the gains and losses related to the Company's 40% stake in Mitsubishi UFJ Morgan Stanley Securities Co., Ltd. (“MUMSS”), as described below.
The following presents certain equity method investees at December 31, 2013 and 2012:
| Book Value(1) | ||||||||
| Percent | December 31, | December 31, | ||||||
| Ownership | 2013 | 2012 | ||||||
| (dollars in millions) | ||||||||
| Mitsubishi UFJ Morgan Stanley Securities Co., Ltd. | 40% | $ | 1,610 | $ | 1,428 | |||
| Lansdowne Partners(2) | 19.8% | 221 | 221 | |||||
| Avenue Capital Group(2)(3) | — | 198 | 224 | |||||
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(1) Book value of these investees exceeds the Company's share of net assets, reflecting equity method intangible assets and equity method goodwill.
(2) The Company's ownership interest represents limited partnership interests. The Company is deemed to have significant influence in these limited partnerships, as the Company's limited partnership interests were above the 3% to 5% threshold for interests that should be accounted for under the equity method.
(3) The Company's ownership interest represents limited partnership interests in a number of different entities within the Avenue Capital Group.
Japanese Securities Joint Venture.
The Company holds a 40% voting interest and MUFG holds a 60% voting interest in MUMSS. The Company accounts for its interest in MUMSS as an equity method investment within the Institutional Securities business segment (see Note 15). During 2013, 2012 and 2011, the Company recorded income (loss) of $570 million, $152 million and $(783) million, respectively, within Other revenues in the consolidated statements of income, arising from the Company's 40% stake in MUMSS.
To the extent that losses incurred by MUMSS result in a requirement to restore its capital, MUFG is solely responsible for providing this additional capital to a minimum level, whereas the Company is not obligated to contribute additional capital to MUMSS. To the extent that MUMSS is required to increase its capital level due to factors other than losses, such as changes in regulatory requirements, both MUFG and the Company are required to contribute the necessary capital based upon their economic interest as set forth above.
In June 2013, MUMSS paid a dividend of approximately $287 million, of which the Company received approximately $115 million for its proportionate share of MUMSS.
The following presents summarized financial data for MUMSS:
| At December 31, | |||||||
| 2013 | 2012 | ||||||
| (dollars in millions) | |||||||
| Total assets | $ | 118,108 | $ | 141,635 | |||
| Total liabilities | 114,648 | 138,742 | |||||
| Noncontrolling interests | 13 | 41 | |||||
| 2013 | 2012 | 2011 | |||||
| (dollars in millions) | |||||||
| Net revenues | $ | 3,305 | $ | 2,365 | $ | 735 | |
| Income (loss) from continuing operations before income taxes | 1,325 | 333 | (1,746) | ||||
| Net income (loss) | 1,459 | 405 | (1,976) | ||||
| Net income (loss) applicable to MUMSS | 1,441 | 397 | (1,976) | ||||
Huaxin Securities Joint Venture.
In June 2011, the Company and Huaxin Securities Co., Ltd. (“Huaxin Securities”) (also known as China Fortune Securities Co., Ltd.) jointly announced the operational commencement of their securities joint venture in China. During 2011, the Company recorded initial costs of $130 million related to the formation of this new Chinese securities joint venture in Other expenses in the consolidated statement of income. The joint venture, Morgan Stanley Huaxin Securities Company Limited, is registered and principally located in Shanghai. Huaxin Securities holds a two-thirds interest in the joint venture, while the Company owns a one-third interest. The establishment of the joint venture allows the Company to further build on its established onshore businesses in China. The joint venture's business includes underwriting and sponsorship of shares in the domestic China market (including A shares and foreign investment shares), as well as underwriting, sponsorship and principal trading of bonds (including government and corporate bonds).
Other.
Lansdowne Partners is a London-based investment manager. Avenue Capital Group is a New York-based investment manager. The investments are accounted for within the Investment Management business segment.
The Company also invests in certain structured transactions and other investments not integral to the operations of the Company accounted for under the equity method of accounting amounting to $2.7 billion and $2.8 billion at December 31, 2013 and 2012, respectively.