Terms

Series

4.250% Non-Cumulative Preferred Stock, Series O

Liquidation Preference

$25.00

Coupon Rate

4.25%

Rate Type

Fixed

Annual Dividend

$1.06

Payment Frequency

Quarterly

Cumulative

No

Perpetual

Yes

Convertible

No

Callable

Yes

First Call Date

January 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 Class Or Series Of Preferred Stock Expressly Stated To Be Senior To Series O Preferred Stock; Pari Passu With: Series A Preferred Stock, Series C Preferred Stock, Series E Preferred Stock, Series F Preferred Stock, Series H Preferred Stock, Series I Preferred Stock, Series K Preferred Stock, Series L Preferred Stock, Series M Preferred Stock, Series N Preferred Stock; Senior To: Common Stock, Any Capital Stock Expressly Stated To Be Junior To Series O 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

52,000,000

Prospectus Summary

Morgan Stanley's Series O is a perpetual, fixed-rate, non-cumulative preferred stock offered as 52 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 4.250% annual dividend translates to approximately $0.2656 per depositary share per quarter, payable on January 15, April 15, July 15, and October 15, commencing January 15, 2022. Crucially, dividends are non-cumulative: if the Board does not declare a dividend for any period, that dividend is permanently forfeited — there is no accrual or catch-up obligation, exposing income investors to permanent loss of missed payments. Series O sits senior to Morgan Stanley's common stock and any junior-designated equity, and on a parity basis with its Series A, C, E, F, H, I, K, L, M, and N preferred stocks. It ranks junior to all debt and non-equity claims. As a holding company issue, it is structurally subordinated to the obligations of Morgan Stanley's operating subsidiaries — meaning subsidiary creditors are satisfied before any assets flow up to the holding company. A regulatory capital call provision allows Morgan Stanley to redeem the entire issue (not partially) within 90 days if a 'Regulatory Capital Treatment Event' occurs — i.e., if regulators determine the stock no longer qualifies as Additional Tier 1 capital — potentially forcing redemption at an inconvenient time for investors. Redemption otherwise requires Federal Reserve Board approval. At the $25 offer price, Series O yields exactly 4.25% annually. Dividends paid to corporate U.S. holders qualify for the dividends-received deduction (DRD); individual holders should generally expect qualified dividend income (QDI) treatment at the 15%/20% preferential rate, subject to applicable holding period rules. Dividend payment dates are the 15th of January, April, July, and October, with a record date typically set 15 calendar days prior. The dividend stopper mechanic blocks payments on common stock and junior equity if Series O dividends have not been fully paid for the most recently completed period — protecting preferred holders' priority — but missed Series O dividends themselves are permanently lost and never cumulate.

Summarized from the SEC prospectus filing.

Distribution History

Ranking vs. Other Preferreds

Dividend Stopper Provisions

Dividend Stopper Description

If Morgan Stanley has not paid full dividends on the Series O Preferred Stock for the latest completed dividend period, it may not pay dividends on or repurchase common stock or other junior securities; conversely, if it has missed dividends on any preferred stock ranking senior to Series O, it cannot pay Series O dividends until those senior arrears are cured.

Other Preferreds from Morgan Stanley

Div Score Breakdown

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