Terms

Series

Fixed-to-Floating Rate Non-Cumulative Preferred Stock, Series I

Liquidation Preference

$25.00

Coupon Rate

6.375%

Rate Type

Fixed To Floating

Annual Dividend

$1.59

Payment Frequency

Quarterly

Cumulative

No

Perpetual

Yes

Convertible

No

Callable

Yes

First Call Date

October 15, 2024

First Call Price

$25.00

Redemption Notice Period

30 days

Capital Stack Ranking

Junior To: All Indebtedness And Other Non-Equity Claims On Morgan Stanley, Any Class Or Series Of Capital Stock Expressly Stated To Be Senior To Series I Preferred Stock; Pari Passu With: Series A Preferred Stock, Series C Preferred Stock, Series E Preferred Stock, Series F Preferred Stock, Series G Preferred Stock, Series H Preferred Stock, Any Other Preferred Stock Not Expressly Stated To Be Senior Or Junior; Senior To: Common Stock, Any Class Or Series Of Capital Stock Expressly Stated To Be Junior To Series I Preferred Stock

Regulatory (Basel III) Call

Yes

Tax Classification

Qualified Dividend

Qualifies for QDI

No

Qualifies for DRD

Yes

Depositary Share Fraction

0.001

Shares Offered

40,000,000

Prospectus Summary

Morgan Stanley's Series I Preferred Stock (CUSIP 61761J406), offered as 40 million depositary shares each representing 1/1,000th of an underlying preferred share, pays a fixed annual dividend of 6.375% on a $25 liquidation preference per depositary share from issuance through October 14, 2024, then resets to three-month USD LIBOR plus 370.8 basis points quarterly thereafter. The stock is perpetual with no maturity date and is non-cumulative — meaning if the Board does not declare a dividend for any quarter, that payment is permanently lost and holders have no claim to it in future periods. Series I sits senior to Morgan Stanley's common stock and any junior-designated capital, pari passu with Series A, C, E, F, G, and H preferred stocks, and junior to all of Morgan Stanley's debt and non-equity obligations. As a holding company issuer, it is structurally subordinated to the creditors of Morgan Stanley's operating subsidiaries, whose assets must satisfy their own creditors before any funds flow up to the parent. A Regulatory Capital Treatment Event call allows Morgan Stanley to redeem the full series in whole (but not in part) within 90 days if a regulatory change causes the preferred stock to lose its Additional Tier 1 capital qualification — a meaningful risk given ongoing Basel III implementation. At the $25 offering price, the effective yield is 6.375% annually (~$0.398 per depositary share per quarter) during the fixed-rate period. Dividends are paid on January 15, April 15, July 15, and October 15, with a record date set 15 calendar days prior to each payment date. For corporate U.S. holders, dividends qualify for the dividends-received deduction; the prospectus does not explicitly confirm qualified dividend income (QDI) treatment at preferential 15%/20% rates for individuals. The dividend stopper prevents distributions on common stock or junior securities in any quarter where Series I dividends have not been paid in full for the most recent completed period, though because dividends are non-cumulative, a missed payment on Series I itself creates no make-whole obligation.

Summarized from the SEC prospectus filing.

Distribution History

Floating Rate Terms

Ranking vs. Other Preferreds

Dividend Stopper Provisions

Dividend Stopper Description

If full dividends on Series I Preferred Stock have not been paid for the most recent completed dividend period, Morgan Stanley cannot pay dividends on or repurchase common stock or other junior securities. Conversely, if any senior-ranking preferred stock has unpaid accrued dividends, Morgan Stanley cannot pay dividends on the Series I Preferred Stock until those senior dividends are made current.

Other Preferreds from Morgan Stanley

Div Score Breakdown

Reinvesty's multi-factor safety analysis for this preferred, composite score: 51 (Average)