Bank of America to price callable capped notes linked to CMS rates

By Marisa Wong

Madison, Wis., Oct. 26 - Bank of America Corp. plans to price callable capped notes due Nov. 19, 2030 based on the 10-year and two-year Constant Maturity Swap rates, according to a 424B2 filing with the Securities and Exchange Commission.

The coupon will be 10% for the first two years. After that, the rate will be four times the spread of the 10-year CMS rate over the two-year CMS rate minus a strike of 25 basis points, up to a maximum of 10%. Interest is payable quarterly and cannot be less than zero.

The payout at maturity will be par.

The notes are callable at par on any interest payment date beginning Nov. 19, 2012.

The notes (Cusip: 06048WEJ5) will settle on Nov. 19.

Merrill Lynch, Pierce, Fenner & Smith Inc. is the underwriter.

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