PROSPECTUS Dated May 1, 1996 Pricing Supplement No. 17 to
PROSPECTUS SUPPLEMENT Registration Statement No. 333-01655
Dated May 1, 1996 June 20, 1996
Rule 424(b)(3)
Morgan Stanley Group Inc.
MEDIUM-TERM NOTES, SERIES C
Senior Fixed Rate Notes
The Fixed Rate Notes, as further described below and in the Prospectus
Supplement under "Description of Notes -- Fixed Rate Notes," will bear
interest from the date of issuance until the principal amount thereof is paid
or made available for payment at the rate set forth below.
The Fixed Rate Notes will be redeemable in whole, but not in part, at the
option of Morgan Stanley Group Inc. upon 30 to 35 calendar days notice on any
July 5 or January 5, commencing July 5, 1998.
<TABLE>
<S> <C> <C> <C>
Principal Amount: $10,000,000 Redemption
Percentage: 100%
Maturity Date: July 5, 2011
Annual Redemption
Interest Rate: 8.00% per annum Percentage
Reduction: N/A
Interest Accrual
Date: July 5, 1996 Interest Payment
Period: Monthly
Interest Payment
Dates: The fifth day of each Specified Currency: U.S. Dollars
month, commencing
August 5, 1996 Issue Price: 100%
Settlement Date
(Original Issue
Redemption Dates: Redeemable in whole, Date): July 5, 1996
but not in part, at the
option of Morgan Book Entry Note or
Stanley Group Inc. Certificated Note: Book Entry Note
upon 30 to 35 calendar
days notice on any July Senior Note or
5 or January 5, Subordinated Note: Senior Note
commencing July 5,
1998 Total Amount of OID: N/A
Minimum Original Yield to
Denomination: $1000 Maturity: N/A
Initial Accrual
Period OID: N/A
Trustee: Chemical Bank
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Other Provisions: Recent Developments - Legal Proceedings: On June 11,
1996, an adversary proceeding was commenced by Orange County, California
and its Treasurer-Tax Collector against Morgan Stanley in the United States
Bankruptcy Court for the Central District of California in County of Orange
and Moorlach v. Morgan Stanley & Co., Inc. The adversary proceeding is
related to Orange County's Chapter 9 bankruptcy proceeding pending before
the same court. The complaint asserts that Orange County, acting through
its former Treasurer-Tax Collector, entered into various reverse repurchase
agreements and other transactions with Morgan Stanley which were beyond the
County's authority or ultra vires and, therefore, void. The complaint also
asserts that Morgan Stanley allowed Orange County to enter into unsuitable
transactions. In addition, the complaint alleges that Morgan Stanley
violated the automatic stay provisions of the Bankruptcy Code when it
liquidated the County's collateral and closed out certain reverse
repurchase transactions subsequent to the County's December 6, 1994
bankruptcy filing. The complaint asserts claims based on ultra vires,
setoff, equitable subordination, restitution, enforcement of the automatic
stay, avoidance of post-petition transfers and negligence and seeks
compensatory damages in an unspecified amount, declaratory and injunctive
relief, restitution, interest, various costs and attorney's fees.
Capitalized terms not defined above have the meanings given to such terms
in the accompanying Prospectus Supplement.
MORGAN STANLEY & CO.
Incorporated
