Terms

Series

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

Liquidation Preference

$25.00

Coupon Rate

5.85%

Rate Type

Fixed To Floating

Annual Dividend

$1.46

Payment Frequency

Quarterly

Cumulative

No

Perpetual

Yes

Convertible

No

Callable

Yes

First Call Date

April 15, 2027

First Call Price

$25.00

Redemption Notice Period

30 days

Capital Stack Ranking

Junior To: All Indebtedness And Non-Equity Claims On Morgan Stanley, Any Capital Stock Expressly Stated To Be Senior To Series K 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, Series I Preferred Stock, Series J Preferred Stock, Any Other Preferred Stock Not Expressly Stated To Be Senior Or Junior; Senior To: Common Stock, Any Capital Stock Expressly Stated To Be Junior To Series K 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 K Preferred Stock is a perpetual, fixed-to-floating rate security offered as 40 million depositary shares, each representing 1/1,000th of an underlying preferred share with a $25,000 liquidation preference (equivalent to $25 per depositary share). The fixed coupon is 5.850% per annum through April 14, 2027, stepping to 3-month USD LIBOR plus 349.1 basis points thereafter; the first optional call date coincides with the rate reset on April 15, 2027. This security is non-cumulative: if the Board does not declare a dividend for any quarter, that dividend is permanently lost and holders have no claim to it in any future period. As a holding company obligation, the Series K Preferred Stock sits below all of Morgan Stanley's debt and non-equity claims in the capital structure — holders are effectively structurally subordinated to the creditors of Morgan Stanley's operating subsidiaries, including its bank and broker-dealer units. The preferred ranks pari passu with Series A, C, E, F, G, H, I, and J preferred stock and senior only to common stock. A regulatory capital call allows Morgan Stanley to redeem the entire issue within 90 days if a change in law, regulation, or official interpretation creates more than an insubstantial risk that the stock will no longer qualify as Additional Tier 1 capital under Federal Reserve guidelines — a provision that can force early redemption without holder consent. At the $25 offering price, the initial fixed-period yield is 5.850%, generating approximately $0.366 per depositary share per quarter. Dividends are paid quarterly on January 15, April 15, July 15, and October 15, with a record date set 15 calendar days before each payment date. Dividends are eligible for the corporate dividends-received deduction (DRD), though QDI treatment for individual holders is not explicitly confirmed in the prospectus. Dividend payments can be interrupted if Morgan Stanley fails to pay dividends on any stock ranking senior to Series K, or if regulators or insufficient lawfully available funds prevent a declaration — and because the stock is non-cumulative, any skipped payment is gone permanently.

Summarized from the SEC prospectus filing.

Distribution History

Floating Rate Terms

Ranking vs. Other Preferreds

Dividend Stopper Provisions

Dividend Stopper Description

If Morgan Stanley has not paid full dividends on the Series K Preferred Stock for the latest completed dividend period, it may not pay dividends on or repurchase common stock or any other junior stock (subject to limited exceptions). Conversely, if Morgan Stanley has not paid accrued dividends on any stock ranking senior to Series K, it may not pay dividends on the Series K 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)