Published on 1/27/2015 in the Prospect News Structured Products Daily.
New Issue: RBC prices $2.01 million trigger phoenix notes with memory coupon linked to Yahoo!
By Jennifer Chiou
New York, Jan. 27 – Royal Bank of Canada priced $2,008,000 of trigger phoenix autocallable notes with memory coupon due Jan. 26, 2018 linked to the common stock of Yahoo! Inc., according to a 424B2 filing with the Securities and Exchange Commission.
If Yahoo! stock closes at or above the barrier price, 70% of the initial share price, on a quarterly observation date, the issuer will pay a contingent coupon for that quarter at the annual rate of 8% plus the memory coupon, which is the product of (a) the contingent coupon and (b) the number of contingent coupon payments, if any, that were not previously paid on their coupon payment dates because the stock price was less than the coupon barrier on the corresponding observation date.
If Yahoo! shares close at or above the initial price on any quarterly observation date, the notes will be called at par plus the contingent coupon.
If the notes are not called and Yahoo! shares finish at or above the barrier price, the payout at maturity will be par plus the contingent coupon. Otherwise, investors will receive a number of Yahoo! shares equal to $1,000 divided by the initial share price or, at the issuer's option, an amount in cash equal to the value of those shares.
RBC Capital Markets, LLC is the underwriter.
| Issuer: | Royal Bank of Canada
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| Issue: | Trigger phoenix autocallable notes with memory coupon
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| Underlying stock: | Yahoo! Inc. (Symbol: YHOO)
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| Amount: | $2,008,000
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| Maturity: | Jan. 26, 2018
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| Coupon: | If Yahoo! stock closes at or above barrier price on quarterly observation date, contingent coupon will be paid for that quarter at annual rate of 8% plus memory coupon
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| Memory coupon: | Product of (a) contingent coupon and (b) number of contingent coupon payments, if any, not previously paid because stock price was less than coupon barrier on corresponding observation date
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| Price: | Par
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| Payout at maturity: | If Yahoo! shares finish at or above barrier price, par plus contingent coupon; otherwise, number of Yahoo! shares equal to $1,000 divided by initial share price or, at issuer's option, amount in cash equal to value of those shares
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| Call: | Automatically at par plus contingent coupon if Yahoo! shares close at or above initial price on any quarterly observation date
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| Initial share price: | $48.95
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| Barrier price: | $34.27, 70% of initial share price
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| Pricing date: | Jan. 23
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| Settlement date: | Jan. 28
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| Underwriter: | RBC Capital Markets, LLC
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| Fees: | 2.2%
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| Cusip: | 78012KAR8
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