Bank of America plans market-linked step up autocallables on Russell

By Toni Weeks

San Luis Obispo, Calif., July 2 - Bank of America Corp. plans to price 0% autocallable market-linked step-up notes due July 2016 tied to the Russell 2000 index, according to an FWP filing with the Securities and Exchange Commission.

The notes will be called at par plus an annualized call premium of 10% if the index is at or above the initial level on either of two annual observation dates occurring in August 2014 and July 2015.

If the notes are not called and the index finishes above the step-up value - 120% to 126% of the initial level - the payout at maturity will be par of $10 plus the index return.

If the index finishes at or above the initial level but is less than or equal to the step-up value, the payout will be par of $10 plus the step-up payment of 20% to 26%.

Investors will receive par if the index falls by up to 5% and will be exposed to any losses beyond the 5% buffer.

The exact terms will be set at pricing.

The notes are expected to price in July and settle in August.

BofA Merrill Lynch is the underwriter.

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