Bank of America to price capped leveraged notes tied to index basket

By Jennifer Chiou

New York, July 9 - Bank of America Corp. plans to price 0% Capped Leveraged Index Return Notes due July 2013 linked to a basket of three indexes, according to an FWP filing with the Securities and Exchange Commission.

The basket consists of the Russell 2000 index with a 50% weight, the MSCI Emerging Markets index with a 30% weight and the MSCI EAFE index with a 20% weight.

The payout at maturity will be par of $10 plus triple any basket gain, up to a maximum payout of $14.00 to $14.40 per note. The exact cap will be set at pricing.

Investors will receive par if the basket falls by up to 10% and will lose 1% for every 1% decline beyond 10%.

The notes will price and settle in July.

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

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