UBS plans to sell 30-year callable CMS spread steepener notes

By Susanna Moon

Chicago, Sept. 23 - UBS AG plans to price 100% principal protection callable CMS spread steepener notes due Oct. 15, 2024, according to an FWP filing with the Securities and Exchange Commission.

The coupon will be 11% for the first year, payable quarterly. After that, interest will be quadruple the spread of the 30-year Constant Maturity Swap rate over the two-year CMS rate, with a floor of zero and a cap of 25% per year.

The payout at maturity will be par.

The notes will be callable at par on any interest payment date beginning Oct. 13, 2010.

The notes are expected to price on Oct. 7 and settle on Oct. 13.

UBS Investment Bank is the underwriter.

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