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Wells Fargo plans contingent annual interest CDs linked to 20 stocks
By Toni Weeks
San Diego, Jan. 4 - Wells Fargo Bank, NA plans to price contingent annual interest certificates of deposit due Jan. 30, 2018 linked to a basket of common stocks, according to a term sheet.
The equally weighted basket includes Amazon.com, Inc., American Express Co., Apple Inc., AT&T Inc., Bristol-Myers Squibb Co., CenturyLink, Inc., Dow Chemical Co., Exelon Corp., General Electric Co., General Mills, Inc., Home Depot, Inc., Johnson & Johnson, JPMorgan Chase & Co., Microsoft Corp., Monsanto Co., Newmont Mining Corp., Occidental Petroleum Corp., Procter & Gamble Co., Schlumberger NV and United Parcel Service, Inc.
In January of each year, the CDs will pay a coupon equal to the sum of the stocks' weighted component returns, subject to a floor of zero. If a stock's underlying return is greater than zero, its component return will be fixed at 5% to 8%. Otherwise, its component return will be the greater of its underlying return and negative 25%.
The exact fixed component return will be set at pricing.
The payout at maturity will be par.
The CDs (Cusip: 949748M61) are expected to price Jan. 25 and settle Jan. 30.
Incapital LLC is the distributor.
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