JPMorgan plans digital contingent coupon CDs linked to stock basket

By Angela McDaniels

Tacoma, Wash., June 6 – JPMorgan Chase Bank, NA plans to price digital contingent coupon certificates of deposit due June 30, 2021 linked to a basket of common stocks, according to a term sheet.

The equally weighted basket includes the common stocks of Apple, Inc., Coca-Cola Co., Duke Energy Corp., Eli Lilly and Co., FedEx Corp., Intel Corp., McDonald’s Corp., Occidental Petroleum Corp., Potash Corp. of Saskatchewan Inc. and Procter & Gamble Co.

Interest is payable annually and will equal the sum of the weighted performances of the basket stocks, subject to a minimum coupon of zero.

If a stock's return is greater than or equal to zero, its performance will be equal to the coupon cap. Otherwise, its performance will be equal to the greater of its return and negative 10%. The coupon cap is expected to be at least 7.25% and will be set at pricing.

The payout at maturity will be par.

J.P. Morgan Securities LLC is the agent. Incapital LLC is distributor.

The CDs are expected to price June 25 and settle June 30.

The fees are expected to be 4.5% or less.

The Cusip number is 48125TQS7.

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