JPMorgan plans variable-rate range accrual CDs linked to Libor, S&P

By Angela McDaniels

Tacoma, Wash., May 29 - JPMorgan Chase Bank, NA plans to price callable variable-rate range accrual certificates of deposit due June 7, 2028 linked to six-month Libor and the S&P 500 index, according to a term sheet.

The interest rate will be 8% for the first year. Beginning June 7, 2014, it will equal the interest factor multiplied by the proportion of days on which the index closes at or above the minimum index level, which will be 75% of the initial index level. Interest will be subject to a floor of zero and a cap. It will be payable quarterly.

The interest factor is (a) 1.2 times (b) the strike rate minus six-month Libor. The strike rate will be 5% in years two through five, 5.5% in years six through 10 and 6% in years 11 through 15.

The interest rate cap will be 6% in years two through five, 6.6% in years six through 10 and 7.2% in years 11 through 15.

The payout at maturity will be par.

Beginning June 7, 2014, the CDs will be callable at par on any interest payment date.

J.P. Morgan Securities LLC is the agent.

The CDs are expected to price June 4 and settle June 7.

The fees are expected to be 5.1%. The agent may use some of the fees to allow 3.55% selling concessions.

The Cusip number is 48124JE46.

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