Bank of America plans step up callable range accrual notes on S&P 500

By Susanna Moon

Chicago, Sept. 1 - Bank of America Corp. plans to price step up callable range accrual notes due September 2020 linked to the S&P 500 index, according to a 424B2 filing with the Securities and Exchange Commission.

The coupon will be 6% for the first year. After that, interest will accrue at a fixed rate for each day that the S&P 500 closes above the reference index level, which is expected to be 77% to 87% of the initial level. Interest will be payable quarterly.

The fixed rate will be 6.5% from September 2011 to September 2014, 7% from September 2014 to September 2016 and 7.5% from September 2016 to September 2020.

The payout at maturity will be par.

The notes will be callable at par on any interest payment date beginning in September 2015.

The notes will price in September and settle in October, with the exact deal terms to be set at pricing.

Merrill Lynch, Pierce, Fenner & Smith Inc. is the underwriter.

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