Morgan Stanley to price 95% capital-protected notes linked to Asian currency basket

By E. Janene Geiss

Philadelphia, March 14 - Morgan Stanley plans to price an offering of zero-coupon capital-protected notes due March 31, 2011 linked to a basket of currencies, according to an FWP filing with the Securities and Exchange Commission.

The basket includes the Hong Kong dollar and Indian rupee, each with a 25% weight, Indonesian rupiah with a 20% weight, along with the Malaysian ringgit and Philippine peso, each with a 15% weight.

The payout at maturity will be based upon the performance of the basket currencies against the dollar. If the currencies strengthen, the payout will be $950 plus the basket increase multiplied by the participation rate, which is expected to be 145% to 175% and will be determined at pricing.

If the currencies weaken relative to the dollar or remain flat, the payout will be $950.

The notes will price and settle in March.

Morgan Stanley & Co. Inc. will be the agent.

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