Bank of America plans callable market-linked step-up notes on S&P 500

By Marisa Wong

Madison, Wis., Sept. 26 - Bank of America Corp. plans to price 0% autocallable market-linked step-up notes due October 2016 linked to the S&P 500 index, according to an FWP with the Securities and Exchange Commission.

The notes will be called at par of $10 plus a premium if the index's closing level is greater than or equal to the initial level on either observation date. The premium will be $0.80 if the notes are called in October 2014 or $1.60 if the notes are called in October 2015.

If the notes are not called and the final index level is greater than or equal to the initial index level, the payout at maturity will be par plus the greater of the step-up payment and the index return. The step-up payment is expected to be 20% to 26% and will be set at pricing. Investors will be fully exposed to any losses.

The notes will price and settle in October.

BofA Merrill Lynch is the underwriter.

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