Morgan Stanley plans to price callable Sifma Municipal Swap index and Libor accrual notes

By Angela McDaniels

Tacoma, Wash., June 29 - Morgan Stanley plans to price callable Sifma Municipal Swap index and Libor accrual notes due July 28, 2025, according to an FWP filing with the Securities and Exchange Commission.

Interest is payable quarterly. The interest rate will be fixed at 10% for the first two years. Beginning July 28, 2012, the interest rate will be 10% per year multiplied by the proportion of days on which the avgSifma/Libor quotient is no more than 70% or Libor is no more than 2%, subject to a floor of zero and a cap of 10% per year in each interest period.

On any day, the avgSifma/Libor quotient is a) the non-compounded daily weighted average of all the values of the Sifma index for the 90-calendar-day period ending on that day divided by b) Libor.

The payout at maturity will be par.

Beginning July 28, 2012, the notes will be callable at par on any interest payment date.

The notes will settle July 28.

Morgan Stanley & Co. Inc. is the agent.

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