Bank of America plans 20-year callable capped notes tied to CMS rates

By Angela McDaniels

Tacoma, Wash., April 29 - Bank of America Corp. plans to price callable capped notes due May 27, 2031 linked to the 30-year and two-year Constant Maturity Swap rates, according to a 424B2 filing with the Securities and Exchange Commission.

The interest rate will be 12% for the first year. After that, the interest rate will be four times the spread of the 30-year CMS rate over the two-year CMS rate minus a strike of 25 basis points, subject to a maximum of 12% and a minimum of zero. Interest will be payable quarterly.

The payout at maturity will be par.

Beginning May 27, 2012, the notes will be callable at par on any interest payment date.

The notes (Cusip: 06048WGC8) are expected to settle May 27.

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

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