By Jennifer Chiou
New York, Dec. 19 – Royal Bank of Canada priced $2 million of redeemable leveraged steepener notes due Dec. 23, 2034 linked to the 30-year Constant Maturity Swap rate and the two-year CMS rate, according to a 424B2 filing with the Securities and Exchange Commission.
The interest rate will be 4% for the first year. After that, the interest rate will be three times the reference rate – the spread of the 30-year CMS rate over the two-year CMS rate minus 15 basis points – subject to a minimum of zero and a maximum of 6% per year. Interest will be payable semiannually.
The payout at maturity will be par.
The notes will be callable on Dec. 23, 2015 and Dec. 23, 2019.
RBC Capital Markets, LLC is the agent.
| Issuer: | Royal Bank of Canada
|
| Issue: | Redeemable leveraged steepener notes
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| Underlying rates: | 30-year and two-year Constant Maturity Swap rates
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| Amount: | $2 million
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| Maturity: | Dec. 23, 2034
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| Coupon: | 9% for first year; after that, three times the spread of 30-year CMS rate over two-year CMS rate minus 15 bps, capped at 6% with floor of zero; payable semiannually
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| Price: | Par
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| Payout at maturity: | Par
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| Call option: | At par on Dec. 23, 2015 and Dec. 23, 2019
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| Pricing date: | Dec. 18
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| Settlement date: | Dec. 23
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| Agent: | RBC Capital Markets, LLC
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| Fees: | 1.8%
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| Cusip: | 78010UWU7
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