By Angela McDaniels
Tacoma, Wash., Sept. 2 – Morgan Stanley Finance LLC priced $5 million of leveraged CMS curve securities due Sept. 30, 2036 linked to the lesser performing of the Russell 2000 index and the S&P 500 index, according to a 424B2 filing with the Securities and Exchange Commission.
The notes are guaranteed by Morgan Stanley.
The interest rate is 9% for the first two years. After that, it will be 20 times the spread of the 30-year ICE swap rate over the two-year ICE swap rate, subject to a minimum of zero and a maximum of 9% per year, multiplied by the proportion of days on which each index closes at or above its index reference level, 65% of its initial level. Interest is payable monthly.
If each index finishes at or above its barrier level, 50% of its initial level, the payout at maturity will be par. Otherwise, investors will be fully exposed to the decline of the lesser-performing index.
Morgan Stanley & Co. LLC is the agent.
The issuer said it may increase the issue size prior to the Sept. 30 settlement date but is not required to do so.
| Issuer: | Morgan Stanley Finance LLC
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| Guarantor: | Morgan Stanley
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| Issue: | Leveraged CMS curve securities
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| Underlying indexes: | S&P 500 and Russell 2000
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| Amount: | $5 million
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| Maturity: | Sept. 30, 2036
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| Coupon: | 9% for first two years, then 20 times spread of 30-year ICE swap rate over two-year ICE swap rate, subject to minimum of zero and maximum of 9% per year, multiplied by proportion of days on which each index closes at or above index reference level; payable monthly
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| Price: | Variable prices
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| Payout at maturity: | Par unless either index finishes below barrier level, in which case full exposure to loss of lesser-performing index
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| Initial index levels: | Indexes’ closing levels on Sept. 27
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| Index reference levels: | 65% of initial levels
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| Barrier levels: | 50% of initial levels
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| Pricing date: | Aug. 31
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| Settlement date: | Sept. 30
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| Agent: | Morgan Stanley & Co. LLC
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| Fees: | 5%
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| Cusip: | 61766YAP6
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