SunTrust Bank plans to price five-year CDs linked to S&P 500 index

By Angela McDaniels

Tacoma, Wash., Jan. 7 - SunTrust Bank plans to price index-linked certificates of deposit due Jan. 28, 2015 linked to the S&P 500 index, according to a term sheet.

Interest is payable quarterly. The coupon will be fixed at 3.5% for the first two years. After that time, if the index closes at or above its initial level on a quarterly observation date, the interest rate for that quarter will be 5% to 6% per year - the exact amount will be set at pricing. Otherwise, no interest will be paid for that quarter.

The payout at maturity will be par.

Beginning March 15, 2011, the CDs will be putable on March 15, June 15, Sept. 15 and Dec. 15 of each year. The redemption amount will be calculated differently than the payout at maturity and may be less than par.

The CDs will price Jan. 22 and settle Jan. 28.

Incapital LLC is the distributor.

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