Published on 8/31/2017 in the Prospect News Structured Products Daily.
New Issue: RBC sells $525,000 autocallable contingent coupon barrier notes on two ETFs
By Wendy Van Sickle
Columbus, Ohio, Aug. 31 – Royal Bank of Canada priced $525,000 of autocallable contingent coupon barrier notes due Aug. 26, 2020 linked to the lesser performing of the SPDR S&P Oil & Gas Exploration & Production exchange-traded fund and the Energy Select Sector SPDR fund, according to a 424B2 filing with the Securities and Exchange Commission.
The notes will pay a quarterly coupon at an annual rate of 7.1% if each fund closes above its coupon barrier level, 60% of its initial price, on the observation date for that quarter.
The notes will be called at par the coupon if each fund closes above its initial price on any quarterly observation date, starting Aug. 21, 2018.
The payout at maturity will be par plus the final coupon unless either fund finishes below the 60% trigger price, in which case investors will lose 1% for each 1% that the lesser-performing fund’s final level is less than its initial level.
RBC Capital Markets, LLC is the underwriter.
Issuer: | Royal Bank of Canada
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Issue: | Autocallable contingent coupon barrier notes
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Underlying ETFs: | SPDR S&P Oil & Gas Exploration & Production exchange-traded fund, Energy Select Sector SPDR fund
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Amount: | $525,000
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Maturity: | Aug. 26, 2020
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Coupon: | 7.1%, payable quarterly if each fund closes at or above coupon barrier level on observation date for that quarter
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Price: | Par
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Payout at maturity: | Par unless either fund finishes below trigger price, in which case investors will lose 1% for each 1% that the lesser-performing fund’s final level is less than its initial level
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Call: | Beginning Aug. 21, 2018, at par if each fund closes at or above initial share price on any quarterly observation date
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Initial fund prices: | $29.09 for SPDR Oil & Gas, $62.00 for Energy Select SPDR
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Coupon barrier/trigger prices: | $17.45 for SPDR Oil & Gas, $37.20 for Energy Select SPDR; 60% of initial stock prices
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Pricing date: | Aug. 21
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Settlement date: | Aug. 24
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Underwriter: | RBC Capital Markets, LLC
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Fees: | 2.25%
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Cusip: | 78012K5E3
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