Bank of America plans Capped Leveraged two-year notes linked to gold

By E. Janene Geiss

Philadelphia, May 29 - Bank of America plans to price 0% Capped Leveraged Index Return Notes due in July 2011 linked to the spot price of gold, according to an FWP filing with the Securities and Exchange Commission.

The payout at maturity will be par of $10 plus double any gain in the price of gold, up to a maximum return of 32% to 36%. The exact cap will be set at pricing.

Investors will receive par if the price of gold falls by up to 10% and will be exposed to declines beyond 10%.

The notes are expected to price in June and settle in July.

Merrill Lynch, Pierce, Fenner & Smith Inc., First Republic Securities Co., LLC and Banc of America Investment Services, Inc. are the underwriters.

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