Bank of America plans market-linked step-up notes on index basket

By Toni Weeks

San Luis Obispo, Calif., Feb. 13 – Bank of America Corp. plans to price market-linked step-up notes due February 2017 tied to a basket of unequally weighted indexes, according to a 424B2 filing with the Securities and Exchange Commission.

The basket is comprised of the Euro Stoxx 50 index with a 40% weight, the Nikkei Stock Average index with a 25% weight, the FTSE 100 index with a 20% weight, the S&P/ASX 200 index with a 7.5% weight and the Swiss Market index with a 7.5% weight.

If the basket finishes above the step-up value, 110% to 116% of the initial basket level, the payout at maturity will be par plus the basket return. If the basket stays flat or increases up to the step-up value, the payout will be par plus a return of 10% to 16%. Investors will be exposed to any losses.

The exact terms will be set at pricing.

BofA Merrill Lynch is the underwriter.

The notes will price and settle in February.

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