Morgan Stanley Saudi Arabia Executed First Equity Swap Agreement in the Kingdom

Riyadh —

Morgan Stanley (NYSE:MS) today announced that Morgan Stanley Saudi Arabia (MSSA) has become the first investment bank to enter into a Swap Agreement with a non-resident foreign investor for a single stock, as authorised by Saudi Arabia's Capital Markets Authority (CMA).

The announcement comes shortly after the CMA approved a resolution to allow Authorised Persons, such as MSSA, to enter into Swap Agreements with non-resident foreign investors for individual stocks. While MSSA retains legal ownership of the shares, the economic benefits of the Saudi companies' shares are transferred to the investor.

Commenting on the transaction, Dr Fahad Almubarak, Chairman of MSSA, said, "This transaction marks an historic milestone for Saudi Arabia, as it is the first time foreign investors are able to have access to companies listed on the Tadawul. Morgan Stanley Saudi Arabia is very pleased to be the first to successfully execute a Swap transaction on behalf of its client, highlighting our efforts to continually drive innovation in the Saudi market."

Craig Niven, a Managing Director at Morgan Stanley, said, "The CMA's move to enable foreign investors to indirectly access Saudi Arabian stocks is an extremely welcome move. Interest from international investors in the GCC's biggest capital market is very high, and we expect to see a lot more interest in these swap transactions from investors around the world."

In 2007, Morgan Stanley Saudi Arabia was the first investment bank to introduce the bookbuilding process to initial public offers (IPOs) in Saudi Arabia when it was the first investment bank to develop a compensation mechanism for non-subscribing shareholders of Saudi rights issues.

Morgan Stanley is a leading global financial services firm providing a wide range of investment banking, securities, investment management, wealth management and credit services. The firm's employees serve clients worldwide including corporations, governments, institutions and individuals from more than 600 offices in 33 countries. For further information about Morgan Stanley, please visit www.morganstanley.com.

Note to Editors:

Morgan Stanley in the Middle East & North Africa

Morgan Stanley has been active in the Middle East and North Africa region since the 1970s, providing a variety of investment banking, asset management and wealth management services. The Firm opened its first office in the Middle East region in the Dubai International Financial Centre and now has offices in Doha and Cairo.

Morgan Stanley Saudi Arabia

Morgan Stanley Saudi Arabia (MSSA) was established in 2007 when Morgan Stanley entered into a majority owned joint venture with The Capital Group, a leading Saudi investment bank. With offices in Riyadh, Jeddah and Khobar, MSSA offers a full range of investment banking, wealth management and asset management services. The Firm was the leading arranger of IPOs in Saudi Arabia during 2007.

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