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Wells Fargo plans six-year annual interest CDs linked to equity basket
By Marisa Wong
Madison, Wis., Oct. 7 - Wells Fargo Bank, NA plans to price annual interest certificates of deposit due Oct. 29, 2016 linked to a basket of common stocks, according to a term sheet.
The equally weighted basket includes Alcoa Inc., American Express Co., Apple Inc., AT&T Inc., Bank of America Corp., Eli Lilly & Co., Exelon Corp., General Electric Co., Home Depot, Inc., Intel Corp., Lockheed Martin Corp., Merck & Co., Inc., Philip Morris International Inc., Schlumberger NV (Schlumberger Ltd.), Verizon Communications Inc. and Wal-Mart Stores, Inc.
In October of each year, the CDs will pay a coupon equal to the sum of the basket stocks' weighted returns, with a floor of zero. The return of each basket stock will be subject to a floor of negative 30% and a cap of 7% to 10% that will be set at pricing.
The payout at maturity will be par.
The CDs (Cusip: 949748YY7) are expected to price Oct. 22 and settle Oct. 29.
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