Bank of America plans Stars linked to S&P 500 via Merrill Lynch

By Jennifer Chiou

New York, April 22 - Bank of America Corp. plans to price 0% Strategic Accelerated Redemption Securities due in June 2011 linked to the S&P 500 index, according to an FWP filing with the Securities and Exchange Commission.

If the index closes at or above the initial index level on any of three observation dates, then the notes will be automatically called and investors will receive par of $10 plus an annualized call premium of 12% to 16%. The observation dates are expected to fall in March 2010, September 2010 and March 2011. The exact premium and dates will be set at pricing.

If the notes are not called, then the payout at maturity will be par if the final index level is at least 90% of the initial level. Otherwise, investors will lose 1% for every 1% that the index declines beyond 10%.

The issuer said it may apply to list the notes on NYSE Arca under the symbol "SJP."

The notes will price in May and settle in June.

Merrill Lynch & Co. and Banc of America Investment Services, Inc. are the underwriters.

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