Morgan Stanley’s first-quarter income beat analysts’ expectations, but the company’s continued struggle to boost profitability weighed down shares Monday.

The bank’s earnings applicable to common shareholders fell 54.4% to $1.06 billion, or 55 cents per share, from a year earlier. Analysts on average had expected earnings of 46 cents per share, according to Thomson Reuters I/B/E/S.

In trading Monday, Morgan Stanley shares were down 0.7% at $27.58. The stock fell about 21% in the first quarter, the sharpest decline of any big U.S. bank.

“The first quarter was characterized by challenging market conditions and muted client activity,” Morgan Stanley CEO James P. Gorman said in a news release. “Against that backdrop, our businesses delivered stable results. While we see some signs of market recovery, global uncertainties continue to weigh on investor activity.”

As Reuters reports, trouble in fixed-income markets has cut deep into Morgan Stanley’s trading revenue as sliding commodity and oil prices, worries about the Chinese economy and uncertainty about U.S. interest rates have scared off traders, investors and companies hoping to issue debt or list on stock exchanges.

Net revenues from the institutional securities business were $3.7 billion in the first quarter, compared with $5.5 billion a year ago.

“It must be said that if these markets were to continue as is, our goals would be extremely difficult to achieve and we would therefore take additional appropriate actions,” Gorman said on a conference call with analysts.

He also said shareholder return-on-equity of 6.2% was “not acceptable” and that the bank might need to get “much more aggressive” on cost cutting. He has set a target of of 9% to 11% by the end of next year.

CFO John Pruzan told Reuters that most of the cost-cutting last quarter came from “tightening up discretionary spending.” More cuts are on the way, including moving more back-office staff to low-cost locations, but it would take time for them to be reflected in earnings.

“There are areas that are starting to take shape but we’ll see the actual savings from those towards the end of the year and next year,” he said.

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