Morgan Stanley had the approval of Archegos, led by fBill Hwang, former Tiger Management analystto shop at his warehouse late Thursday, the report said.
The bank offered the shares at a discount, telling hedge funds that they were part of a margin call that could prevent the collapse of an undisclosed customer, CNBC reported.
Morgan Stanley did not immediately respond to a Reuters request for comment.
Earlier on Tuesday Credit Suisse said there would be a hit of 4.4 billion Swiss francs ($ 4.72 billion) from deals with Archegos Capital Management, prompting it to overhaul the governance of its investment banking and risk divisions.
Other banks exposed to Archegos, including Goldman Sachs and Deutsche Bank, have closed their dealings, Reuters reported on Monday, citing sources with direct knowledge of the transactions.