By Marisa Wong
Madison, Wis., Jan. 26 – Royal Bank of Canada priced $2.23 million of 0% contingent absolute return autocallable optimization securities due Feb. 1, 2016 linked to Southwest Airlines Co. shares, according to a 424B2 filing with the Securities and Exchange Commission.
The notes will be called at par of $10 plus an annualized call premium of 11.3% if Southwest Airlines shares close at or above the initial price on any quarterly observation date.
If the notes are not called and the final share price is greater than or equal to the trigger level, 75% of the initial price, the payout at maturity will be par plus the absolute value of the stock return.
Otherwise, investors will be fully exposed to any losses.
UBS Financial Services Inc. and RBC Capital Markets, LLC are the agents.
| Issuer: | Royal Bank of Canada
|
| Issue: | Contingent absolute return autocallable optimization securities
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| Underlying stock: | Southwest Airlines Co. (Symbol: LUV)
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| Amount: | $2,234,000
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| Maturity: | Feb. 1, 2016
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| Coupon: | 0%
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| Price: | Par of $10.00
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| Payout at maturity: | If final share price is greater than or equal to trigger price, par plus absolute value of stock return; otherwise, full exposure to losses
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| Call: | At par plus 11.3% per year if Southwest Airlines stock closes at or above initial share price on any quarterly observation date
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| Initial price: | $45.78
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| Trigger price: | $34.34, 75% of initial share price
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| Pricing date: | Jan. 23
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| Settlement date: | Jan. 28
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| Agents: | UBS Financial Services Inc. and RBC Capital Markets, LLC
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| Fees: | 1.5%
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| Cusip: | 780082301
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