Published on 6/28/2010 in the Prospect News Structured Products Daily.
New Issue: Bank of America sells $17.6 million callable capped notes linked to CMS rates
By Susanna Moon
Chicago, June 28 - Bank of America Corp. priced $17.6 million of callable capped notes due July 1, 2022 linked to the 30-year Constant Maturity Swap rate and two-year CMS rate, according to a 424B2 filing with the Securities and Exchange Commission.
The coupon will be 10% for the first year. After that, the rate will be four times the spread of the 30-year CMS rate over the two-year CMS rate minus 15 basis points, up to a cap 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 July 1, 2013.
Merrill Lynch, Pierce, Fenner & Smith Inc. and its broker-dealer affiliate First Republic Securities Co., LLC are the underwriters.
Issuer: | Bank of America Corp.
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Issue: | Callable capped notes
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Underlying rates: | 30-year and two-year Constant Maturity Swap rates
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Amount: | $17,603,000
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Maturity: | July 1, 2022
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Coupon: | 10% for the first year; beginning July 1, 2011, four times the difference between 30-year CMS rate and two-year CMS rate minus 15 bps, capped at 10%; payable quarterly
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Price: | Par
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Payout at maturity: | Par
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Call option: | At par on interest payment dates beginning July 1, 2013
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Pricing date: | June 24
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Settlement date: | July 1
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Underwriters: | Merrill Lynch, Pierce, Fenner & Smith Inc. and First Republic Securities Co., LLC
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Fees: | 1.75%
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Cusip: | 06048WCL2
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