Bank of America to price step-up notes due 2018 linked to S&P 500

By Angela McDaniels

Tacoma, Wash., April 1 - Bank of America Corp. plans to price 0% market-linked step-up notes due April 2018 linked to the S&P 500 index, according to an FWP filing with the Securities and Exchange Commission.

If the final index level is greater than the step-up value, the payout at maturity will be par of $10 plus the index return. The step-up value is expected to be 117% to 123% of the initial index level.

If the final index level is greater than or equal to the initial level but less than or equal to the step-up value, the payout will be par plus the step-up payment, which is expected to be 17% to 23%.

If the final index level is less than the initial level but greater than or equal to the threshold level, investors will receive par. The threshold level will be 80% of the initial index level.

Otherwise, investors will lose 1% for every 1% that the index declines below the threshold level.

The exact step-up value and step-up payment will be set at pricing.

BofA Merrill Lynch is the agent.

The notes are expected to price in April and settle in May.

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