Morgan Stanley To Acquire Broker E*Trade For $13 Bln

US investment bank Morgan Stanley announced Thursday it will buy online trading pioneer E*Trade in a deal valued at $13 billion.

It would be the largest acquisition by an American bank since the 2008 global financial crisis, and comes as online brokers are competing fiercely for new customers.

The transaction, which requires approval from regulators, is Morgan Stanley's latest move to reinvigorate itself after nearly being crushed by bad investments during the market crash.

The New York-based financial giant has transformed itself from an institution focused on speculation into a wealth manager for the rich and middle class.

The acquisition of E*Trade allows Morgan Stanley to go a step further and manage the money, savings and assets of small investors.

Founded in California, E*Trade helped revolutionize online trading in the 1980s, opening the door to individual investors to invest on Wall Street, avoiding traditional brokers who demanded high fees and often would not work with small investors.

The company offers financial services to small savers and claims five million clients with assets valued at $360 billion.

The acquisition is expected to be closely scrutinized by regulators determined to avoid the mistakes that led to the 2008 financial crisis.