Morgan Stanley to price notes linked to 10-year, two-year CMT rates

By Angela McDaniels

Seattle, April 10 - Morgan Stanley plans to price an offering of senior floating-rate notes due April 27, 2037 linked to the 10-year and two-year Constant Maturity Treasury (CMT) rates, according to an FWP filing with the Securities and Exchange Commission.

The notes are expected to price in April and settle on April 27.

The notes will accrue interest at 8% per year through April 26, 2012. After that, interest will be paid and reset quarterly and will equal the spread of the 10-year CMT rate over the two-year CMT rate plus 4% per year, subject to a minimum interest rate of 3%.

Morgan Stanley may call the notes at par plus accrued interest on any interest payment date beginning April 27, 2012.

Morgan Stanley & Co. Inc. will be the agent and will receive a commission of 3%.

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