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SunTrust Bank plans CDs linked to S&P 500 with contingent interest
By E. Janene Geiss
Philadelphia, Sept. 29 - SunTrust Bank plans to price 0% certificates of deposit due Oct. 28, 2014 linked to the S&P 500 index, according to a term sheet.
During the first three years, the CDs pay interest at 3.5%.
For the final two years, the annual coupon will be 5.5% to 6.5% if the index closes above its initial level, or zero if it declines. The exact contingent coupon will be set at pricing.
The annual observation dates are Oct. 22, 2013 and Oct. 22, 2014.
Beginning Sept. 15, 2010, the CDs will be putable on quarterly early redemption dates. The redemption amount will be calculated differently than the payout at maturity, will include an early withdrawal penalty and may be less than par.
At maturity, the payout will be par.
The CDs will price on Oct. 22 and settle on Oct. 28.
InCapital LLC is the distributor.
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