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Morgan Stanley plans fixed-to-floaters linked to CMS rates, indexes
By Sarah Lizee
Olympia, Wash., Oct. 9 – Morgan Stanley Finance LLC plans to price fixed-to-floating securities due Oct. 31, 2038 linked to the worst performing of the S&P 500 index and the Russell 2000 index, according to an FWP filing with the Securities and Exchange Commission.
The notes are guaranteed by Morgan Stanley.
Interest will be fixed at 10% for the first year. After that, it will accrue at 30 times the spread of the 30-year U.S. dollar ICE swap rate minus the two-year U.S. dollar ICE swap rate for each day that each index closes at or above its 60% reference level, subject to a maximum interest rate of 10%. Interest will be payable quarterly and cannot be less than zero.
The payout at maturity will be par unless any index finishes below its 60% barrier level, in which case investors will be fully exposed to the decline of the worst performing index.
Morgan Stanley & Co. LLC is the agent.
The notes will price on Oct. 26.
The Cusip number is 61766YDJ7.
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