Morgan Stanley and Citigroup Reach Agreement for Full Purchase of MSSB, and Related Deposits, by June 2015 at a $13.5 Billion Valuation, Subject to Regulatory Approval

New York – Morgan Stanley (NYSE: MS) and Citigroup (NYSE: C) today announced that they have reached agreement for Morgan Stanley to purchase Citi's 14 percent stake in Morgan Stanley Smith Barney Holdings LLC (MSSB), together with the transfer of approximately $5.5 billion of deposits at no premium, at an implied 100 percent valuation of $13.5 billion.

In addition, subject to obtaining the required regulatory approval, Morgan Stanley and Citi have reached agreement with respect to the purchase of Citi's remaining 35 percent stake in MSSB, inclusive of related deposits of approximately $48 billion, no later than June 1, 2015 at the same implied $13.5 billion valuation. Morgan Stanley has agreed to acquire the next 15 percent stake in MSSB from Citi by June 1, 2013, subject to regulatory approval. The related deposit transfers will be at no premium.

James P. Gorman, Chairman and Chief Executive Officer of Morgan Stanley, said: "This mutually beneficial agreement gives both parties certainty and transparency on price and timing, and is a significant milestone for Morgan Stanley in the implementation of our strategy."

Vikram Pandit, Chief Executive Officer of Citi, said: "I am pleased we have reached agreement on a value for our remaining stake in Morgan Stanley Smith Barney. Establishing certainty regarding the divestiture of this business is in the best interests of our shareholders. As we have shown, the more we put the past behind us, the more we can focus on our future, which is in the core businesses in Citicorp. Since forming Citi Holdings, we have reduced its assets by over $600 billion, and we will continue to do so in an economically rational manner."

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Morgan Stanley

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please visit www.morganstanley.com.

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