RBC to price one-year Stars linked to S&P 500 via BofA Merrill Lynch

By Toni Weeks

San Luis Obispo, Calif., Oct. 24 - Royal Bank of Canada plans to price 0% Strategic Accelerated Redemption Securities due December 2014 linked to the S&P 500 index, according to an FWP filing with the Securities and Exchange Commission.

If the index closes at or above its initial level on any of three observation dates, the notes will be called at par of $10 plus an annualized call premium of 4% to 8%. The observation dates are in May 2014, August 2014 and December 2014. The exact call premium will be determined at pricing.

If the notes are not called and the final index value is at least 95% of the initial value, the payout at maturity will be par. Investors will be exposed to losses beyond the 5% buffer.

The notes are expected to price in November and settle in December.

BofA Merrill Lynch is the agent.

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