Bank of America plans four-year market-linked step up notes on S&P 500

By Marisa Wong

Madison, Wis., Aug. 27 - Bank of America Corp. plans to price four-year 0% market-linked step up notes linked to the S&P 500 index, according to an FWP filing with the Securities and Exchange Commission.

If the index finishes at or above the initial level, the payout at maturity will be par of $10 plus the greater of the step up payment and the index return. The step up payment is expected to be 36% to 42% and will be set at pricing.

Investors will receive par if the final index level is less than the initial level but at least 85% of the initial level and will be exposed to any index decline beyond the threshold.

The notes are expected to price in August or September.

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

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