Terms

Series

4.875% Non-Cumulative Preferred Stock, Series L

Liquidation Preference

$25.00

Coupon Rate

4.875%

Rate Type

Fixed

Annual Dividend

$1.22

Payment Frequency

Quarterly

Cumulative

No

Perpetual

Yes

Convertible

No

Callable

Yes

First Call Date

January 15, 2025

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 L Preferred Stock, All Obligations Of Morgan Stanley Subsidiaries (Structural Subordination); 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, Series K Preferred Stock, Any Other Preferred Stock Not Expressly Stated To Be Senior Or Junior; Senior To: Common Stock, Any Class Or Series Of Morgan Stanley Capital Stock Expressly Stated To Be Junior To Series L Preferred Stock

Regulatory (Basel III) Call

Yes

Tax Classification

Qualified Dividend

Qualifies for QDI

Yes

Qualifies for DRD

Yes

Depositary Share Fraction

0.001

Shares Offered

20,000,000

Prospectus Summary

Morgan Stanley's Series L Preferred Stock is a perpetual, fixed-rate preferred offering represented by 20,000,000 depositary shares, each constituting a 1/1,000th interest in an underlying preferred share with a $25,000 liquidation preference (equivalent to $25 per depositary share). The security pays a fixed 4.875% dividend rate, translating to approximately $0.305 per depositary share quarterly, on January 15, April 15, July 15, and October 15, commencing January 15, 2020. Critically, this preferred is non-cumulative: if Morgan Stanley's board does not declare a dividend for any period, that dividend is permanently forfeited and investors have no claim to recover it. Series L Preferred Stock ranks senior to Morgan Stanley's common stock and all junior securities, and pari passu with its other outstanding preferred series (A, C, E, F, G, H, I, J, and K). As equity of the holding company, it is structurally subordinated to all debt obligations — including the substantial liabilities of Morgan Stanley's operating subsidiaries such as Morgan Stanley & Co. LLC and its bank subsidiaries — meaning creditors of those subsidiaries are paid first before any distributions flow up to preferred holders. A regulatory capital call provision allows Morgan Stanley to redeem the Series L in whole (but not in part) within 90 days if a change in law or regulation creates more than an insubstantial risk that the preferred will no longer qualify as Additional Tier 1 capital; this provision protects the issuer's capital planning flexibility but creates involuntary call risk for investors before the standard January 15, 2025 call date. At the $25 offering price, Series L yields exactly 4.875% annually. Dividends qualify for the dividends-received deduction (DRD) for eligible corporate U.S. holders and are expected to qualify for the preferential 15%/20% qualified dividend income (QDI) rate for individual U.S. holders, subject to customary holding period and other requirements. Dividends are paid quarterly with a record date set on the 15th calendar day before each payment date. The dividend stopper prevents Morgan Stanley from paying dividends on or repurchasing common stock or other junior securities during any period in which Series L dividends for the most recent completed period have not been fully paid — providing a measure of income prioritization — but this protection does not guarantee payment, as the non-cumulative structure means any missed dividend is simply lost.

Summarized from the SEC prospectus filing.

Distribution History

Ranking vs. Other Preferreds

Dividend Stopper Provisions

Dividend Stopper Description

If full dividends on Series L Preferred Stock for the latest completed dividend period have not been declared and paid, Morgan Stanley cannot pay dividends on or repurchase its common stock or other junior securities (subject to limited exceptions). Conversely, if Morgan Stanley has failed to pay dividends on any stock ranking senior to Series L, it cannot pay dividends on or redeem Series L Preferred Stock until those senior dividends are fully paid.

Other Preferreds from Morgan Stanley

Div Score Breakdown

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