Bank of the West plans CDs tied to Morningstar Ultimate Stock-Pickers

By Toni Weeks

San Luis Obispo, Calif., March 8 - Bank of the West plans to price 0% market-linked certificates of deposit due March 27, 2020 linked to the Morningstar Ultimate Stock-Pickers Target Volatility 7 index, according to a term sheet.

The payout at maturity will be par plus 100% to 105% of the index return, subject to a minimum payout of par. The exact participation rate will be set at pricing.

The objective of the index is to provide variable exposure to the Morningstar Ultimate Stock-Pickers index (the "base index"). It is intended to provide a performance benchmark that (a) invests in the base index, (b) algorithmically adjusts the leverage of its investment so as to decrease exposure in times of high volatility and increase exposure in times of low volatility in order to maintain a constant target volatility of 7% and (c) is made with borrowed money funded at a synthetically rolling Libor.

The objective of the base index is to invest in up to 60 publicly listed equities that are among the most widely held and most purchased stocks of the 26 select investment managers followed by Morningstar.

The CDs will price March 22 and settle March 27.

BNP Paribas Securities Corp. is the agent. Advisors Asset Management, Inc. is the distributor.

The Cusip number is 06426XGK0.

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