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TEXT-S&P cuts Morgan Stanley Managed ACES SPC 2006-10

(The following statement was released by the rating agency)

Oct 4 - Standard & Poor's Ratings Services today lowered its ratings on the class IB and IC notes from Morgan Stanley Managed ACES SPC 2006-10 To 'D (sf)' from 'CCC- (sf)' (see list).

The lowered ratings follow recent credit events that affected the transaction's underlying reference entities, which caused the notes to incur partial principal losses.

STANDARD & POOR'S 17G-7 DISCLOSURE REPORT

SEC Rule 17g-7 requires an NRSRO, for any report accompanying a credit rating relating to an asset-backed security as defined in the Rule, to include a description of the representations, warranties and enforcement mechanisms available to investors and a description of how they differ from the representations, warranties and enforcement mechanisms in issuances of similar securities. The Rule applies to in-scope securities initially rated (including preliminary ratings) on or after Sept. 26, 2011.

If applicable, the Standard & Poor's 17g-7 Disclosure Report included in this credit rating report is available at

RELATED CRITERIA AND RESEARCH

-- Global Structured Finance Scenario And Sensitivity Analysis: The Effects Of The Top Five Macroeconomic Factors, Nov. 4, 2011

-- Criteria: Structured Finance: CDOs: Revised Methodologies And Assumptions For Global Synthetic CDO Surveillance, Sept. 30, 2010

-- Revised Methodologies And Assumptions For Global Synthetic CDO Surveillance, Sept. 30, 2010

-- Methodology: Credit Stability Criteria, May 3, 2010

-- Update To Global Methodologies And Assumptions For Corporate Cash Flow And Synthetic CDOs, Sept. 17, 2009

-- General Criteria: Understanding Standard & Poor's Rating Definitions, June 3, 2009

RATINGS LOWERED Morgan Stanley Managed ACES SPC Series 2006-10 Rating Class To From IB D CCC- (sf) IC D CCC- (sf)

(Caryn Trokie, New York Ratings Unit)

((Caryn.Trokie@thomsonreuters.com; 646-223-6318; Reuters Messaging: rm://caryn.trokie.reuters.com@reuters.net))

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