CHARLOTTE, N.C., June 21,
2024 /PRNewswire/ -- Bank of America Corporation
("BAC") (NYSE: BAC) has issued and outstanding certain floating or
fixed-to-floating rate debt securities, listed in Annexes 1, 2 and
3 to this press release for which the Canadian dollar Bankers'
Acceptance Rate ("CDOR"), which is also known as the Canadian
Dollar Offered Rate, for an index maturity of three months
("Three-Month CDOR") serves as the base rate used or to be used in
calculating or determining applicable interest payments (the "CDOR
Securities"). On May 16, 2022,
Refinitiv Benchmark Services (UK) Limited ("RBSL"), the
administrator of CDOR, announced that the calculation and
publication of all remaining CDOR tenors, including Three-Month
CDOR, will permanently cease immediately following a final
publication on Friday, June 28,
2024.
BAC is announcing that, on the first Toronto banking day after June 28, 2024 (the "CDOR Replacement Date"),
Fallback Rate (CORRA) published for a three-month tenor,
as calculated and provided by Bloomberg Index Services Limited
("BISL") (or any successor provider thereof) ("Three-Month Fallback
Rate (CORRA)") will replace Three-Month CDOR as the base rate for
calculations or determinations of applicable interest rates and
payments during floating rate interest periods for each of the CDOR
Securities listed in Annexes 1 and 2 to this press release.
Such replacement will be effective for such determinations for
floating rate interest periods commencing (and the related interest
determination dates occurring) on and after the CDOR Replacement
Date but will not affect any such determinations for floating rate
interest periods for which the relevant interest determination
dates occur prior to the CDOR Replacement Date. The manner in which
Three-Month Fallback Rate (CORRA) is determined and the timing for
determinations of Three-Month Fallback Rate (CORRA) for purposes of
the CDOR Securities differ from the manner and timing of
determinations of Three-Month CDOR. See "Three-Month Fallback Rate
(CORRA)" below.
In addition, BAC is announcing that it intends to redeem the
CDOR Securities listed in Annex 3 to this press release in
accordance with their terms prior to the commencement of the
floating rate period for such CDOR Securities. This press release
does not constitute a notice of redemption of the CDOR Securities
listed in Annex 3, and any such notice of redemption will be issued
separately in accordance with the terms of the CDOR Securities
listed in Annex 3 and the applicable indenture. See "CDOR
Securities—CDOR Securities with Non-Workable Fallback Provisions"
below.
CDOR Securities
Each CDOR Security listed in Annexes 1, 2 and 3 to this press
release falls into one of the three categories described below.
CDOR Securities with Alternative Rate Determined by
Calculation Agent
The series of CDOR Securities listed in Annex 1 to this
press release (the "Annex 1 CDOR Securities") contain fallback
provisions for Three-Month CDOR directing Merrill Lynch Canada Inc.
("ML Canada"), as calculation agent for each series of Annex 1 CDOR
Securities, to use as a substitute for Three-Month CDOR if such
rate has been permanently or indefinitely discontinued, the
alternative reference rate selected or recommended by the central
bank, monetary authority, relevant regulatory supervisor or any
similar institution (including any committee or working group
thereof) that is consistent with accepted market practice for debt
obligations such as the Annex 1 CDOR Securities (such rate, the
"Alternative Rate"). For each series of the Annex 1 CDOR
Securities, ML Canada has determined that it will use Three-Month
Fallback Rate (CORRA) as the Alternative Rate on and after the CDOR
Replacement Date.
CDOR Securities Containing CARR Recommended Fallback
Provisions
The series of CDOR Securities listed in Annex 2 to
this press release (the "Annex 2 CDOR Securities") contain fallback
provisions for Three-Month CDOR substantially in the form
recommended by the Canadian Alternative Reference Rate Working
Group ("CARR") on July 6, 2021. These fallback provisions provide
that, if an index cessation event and index cessation effective
date (as such terms are defined in the Annex 2 CDOR Securities)
have occurred with respect to Three-Month CDOR, the rate for an
interest determination date occurring on or after the index
cessation effective date will be determined as if references to
Three-Month CDOR were references to Three-Month Fallback Rate
(CORRA). BAC has determined that an index cessation event has
occurred with respect to Three-Month CDOR and that the related
index cessation effective date will occur on the CDOR Replacement
Date, such that, for each of the Annex 2 CDOR Securities, the rate
of interest for each floating rate interest period commencing on or
after the CDOR Replacement Date will be determined as if references
to Three-Month CDOR were references to Three-Month Fallback Rate
(CORRA).
CDOR Securities with Non-Workable Contractual Fallback
Provisions
The single series of CDOR Securities listed in Annex 3 to
this press release (the "Annex 3 CDOR Securities") contains
fallback provisions for Three-Month CDOR that provide solely for
(i) use of an alternative page to obtain Three-Month CDOR and (ii)
inquiries for quotes from banks for Canadian dollar bankers'
acceptances. It is expected that, following the CDOR Replacement
Date, such fallback provisions would not be effective in providing
a base rate for the Annex 3 CDOR Securities. As a result, BAC
intends to redeem the Annex 3 CDOR Securities in accordance with
their terms prior to the commencement of the floating rate period.
This press release does not constitute a notice of redemption of
the Annex 3 CDOR Securities, and any such notice will be issued
separately in accordance with the terms and provisions of the Annex
3 CDOR Securities and the governing indenture.
Three-Month Fallback Rate (CORRA)
Fallback Rate (CORRA) is the CARR-recommended replacement rate for CDOR for
legacy floating-rate notes referencing CDOR. Three-Month Fallback
Rate (CORRA) is calculated and provided by BISL, as the vendor
officially selected for that purpose by the International Swaps and
Derivatives Association Inc. ("ISDA"), and comprises the daily
Canadian Overnight Repo Rate Average ("CORRA") administered by the
Bank of Canada compounded in
arrears over the relevant three-month interest period, and a fixed
spread adjustment of 0.32138% (being the static spread relating to
Three-Month CDOR fixed by BISL on May 16,
2022). BISL calculates Three-Month Fallback Rate (CORRA) in
accordance with specific formulae, definitions, rules and
conventions set forth in its "IBOR Fallback Rate Adjustments Rule
Book."
Three-Month CDOR is a forward-looking term rate determined by
the calculation agent at the beginning of each applicable floating
rate interest period for the CDOR Securities. Because Three-Month
Fallback Rate (CORRA) represents daily CORRA compounded in arrears,
unlike Three-Month CDOR, Three-Month Fallback Rate (CORRA) can be
determined only near the end of each applicable interest period for
the CDOR Securities. For a description of how the calculation agent
will determine Three-Month Fallback Rate (CORRA) for each floating
rate interest period for the CDOR Securities commencing on or after
the CDOR Replacement Date, please refer to Annex 4.
Adjustments to Other Terms and Provisions of the CDOR
Securities
Under the terms of the CDOR Securities, ML Canada, as
calculation agent, or BAC, as issuer, has the right to make certain
adjustments to the terms of the CDOR Securities in connection with
the substitution of Three-Month Fallback Rate (CORRA) for
Three-Month CDOR as the base rate for the CDOR Securities. See
Annex 5 for a description of such adjustments that ML Canada
and BAC, as applicable, have determined will be applicable for the
Annex 1 CDOR Securities and Annex 2 CDOR Securities,
respectively.
Forward-Looking Statements
Certain statements contained in this press release may
constitute "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995.
Forward-looking statements made in this press release include,
without limitation, statements concerning the expected transition
of the base rate for the CDOR Securities to Three-Month Fallback
Rate (CORRA), and the Corporation's intention to redeem the CDOR
Securities listed in Annex 3. These statements are not
guarantees of future results or performance and involve certain
risks, uncertainties and assumptions that are difficult to predict
or beyond our control. You should not place undue reliance on
any forward-looking statement and should consider the uncertainties
with respect to such transition and resulting risks that such
transition would not occur, and including those discussed under
Item 1A. "Risk Factors" in our Annual Report on Form 10-K for the
year ended December 31, 2023, and in any of our subsequent
Securities and Exchange Commission filings. Forward-looking
statements speak only as of the date they are made, and except as
required by the U.S. federal securities laws, we undertake no
obligation to update any forward-looking statement to reflect the
impact of circumstances or events that arise after the date the
forward-looking statement was made.
Bank of America
Bank of America is one of the world's leading financial
institutions, serving individual consumers, small and middle-market
businesses and large corporations with a full range of banking,
investing, asset management and other financial and risk management
products and services. The company provides unmatched
convenience in the United States,
serving approximately 69 million consumer and small business
clients with approximately 3,800 retail financial centers,
approximately 15,000 ATMs (automated teller machines) and
award-winning digital banking with approximately 57 million
verified digital users. Bank of America is a global leader in
wealth management, corporate and investment banking and trading
across a broad range of asset classes, serving corporations,
governments, institutions and individuals around the world.
Bank of America offers industry-leading support to approximately 4
million small business households through a suite of innovative,
easy-to-use online products and services. The company serves
clients through operations across the United States, its territories and more than
35 countries. Bank of America Corporation stock is listed on the
New York Stock Exchange (NYSE: BAC).
For more Bank of America news, including dividend announcements
and other important information, visit the Bank of America newsroom
and register for news email alerts.
Investors May Contact:
Lee
McEntire, Bank of America
Phone: 1.980.388.6780
lee.mcentire@bofa.com
Jonathan Blum, Bank of America
(Fixed Income)
Phone: 1.212.449.3112
jonathan.blum@bofa.com
Reporters May Contact:
Bill
Halldin, Bank of America
Phone: 1.916.724.0093
william.halldin@bofa.com
ANNEX 1
Calculation Agent
Determination
|
|
CUSIP
No.
|
Issue
Date
|
Title of
Security
|
060505FS8
|
3/24/20
|
3.515% Fixed/Floating
Rate Senior Notes, due March 2026
|
060505FU3
|
3/25/21
|
2.598% Fixed/Floating
Rate Senior Notes, due April 2029
|
060505FZ2
|
6/15/21
|
1.978% Fixed/Floating
Rate Senior Notes, due September 2027
|
060505FY5
|
6/15/21
|
Floating Rate Senior
Notes, due September 2027
|
ANNEX 2
CARR Recommended
Fallback Provisions
|
|
CUSIP
No.
|
Issue
Date
|
Title of
Security
|
060505GF5
|
3/16/221
|
3.615% Fixed/Floating
Rate Senior Notes, due March 2028
|
060505GE8
|
3/16/22
|
Floating Rate Senior
Notes, due March 2026
|
ANNEX 3
Non-Workable
Contractual Fallback Provisions
|
|
CUSIP
No.
|
Issue
Date
|
Title of
Security
|
060505FG4
|
9/20/17
|
3.407% Fixed/Floating
Rate Senior Notes, due September 2025
|
ANNEX 4
Calculation Agent's Determination of
Three-Month Fallback Rate (CORRA)
For each series of CDOR Securities, for each floating rate
interest period commencing on or after the CDOR Replacement Date,
ML Canada will determine the applicable interest rate as if
references to Three-Month CDOR in the terms and provisions of each
series of such CDOR Securities were references to Three-Month
Fallback Rate (CORRA), as provided by BISL on the Fallback Rate
(CORRA) Screen (as defined below), for the Original IBOR Rate
Record Day (as defined below) that corresponds to the applicable
interest determination date for such floating rate interest period,
as most recently provided or published as at 11:30 a.m., Toronto time on the related Fallback
Observation Day (as defined below). If publication of Three-Month
Fallback Rate (CORRA) has not ceased permanently or indefinitely,
and neither BISL provides, nor authorized distributors publish,
Three-Month Fallback Rate (CORRA) for the applicable Original IBOR
Rate Record Day at, or prior to, 11:30
a.m., Toronto time on such
related Fallback Observation Day, then the rate for such interest
determination date will be Three-Month Fallback Rate (CORRA) as
most recently provided or published on the Fallback Rate (CORRA)
Screen at that time for the most recent Original IBOR Rate Record
Day, notwithstanding that such day does not correspond to such
interest determination date for such floating rate interest
period.
For purposes of the foregoing description of the determination
of Three-Month Fallback Rate (CORRA):
- "Fallback Observation Day" means, in respect of an interest
determination date and the interest period to which such interest
determination date relates, the day that is two business days (as
defined in the terms and provisions of the applicable series
of CDOR Securities) preceding the related interest payment
date for such interest period;
- "Fallback Rate (CORRA) Screen" means the Bloomberg Screen
corresponding to the Bloomberg ticker for the fallback for CDOR for
a relevant interest period accessed via the Bloomberg Screen
<FBAK> <GO> Page (or, if applicable, accessed via the
Bloomberg Screen <HP><GO>) or any other published
source designated by BISL (or a successor provider as approved
and/or appointed by ISDA from time to time); and
- References to an "Original IBOR Rate Record Day" are to
that term as used on the Fallback Rate (CORRA) Screen.
ANNEX 5
Adjustments to Other Terms and Provisions of
the CDOR Securities
Adjustments for Annex 1 CDOR Securities
The following adjustments will be applicable to the terms and
provisions of the Annex 1 CDOR Securities for each floating
rate interest period commencing on or after the CDOR Replacement
Date:
- The calculation agent will not refer to the interest
determination date when determining the applicable interest rate
for a series of Annex 1 CDOR Securities for a particular
interest period. Instead, the calculation agent will refer to the
applicable Fallback Observation Day, in accordance with the
description set forth in Annex 4.
- The calculation date for each floating rate interest period
will be the Fallback Observation Day for the applicable interest
period.
- The calculation agent will provide BAC, as issuer, and,
upon request, the holder of any Annex 1 CDOR Securities,
Three-Month Fallback Rate (CORRA), the interest rate and the amount
of interest accrued with respect to any interest period for such
CDOR Security, after Three-Month Fallback Rate (CORRA) and such
interest rate and accrued interest have been determined.
- Upon the occurrence of a Fallback Index Cessation Event with
respect to Three-Month Fallback Rate (CORRA), the rate for an
interest reset date which relates to a relevant interest period in
respect of which the Fallback Observation Day occurs on or after
the Fallback Index Cessation Effective Date will be Compounded
CORRA based on the Canadian Overnight Repo Rate Average ("CORRA")
administered by the Bank of Canada
(or any successor administrator), plus a fixed spread adjustment of
0.32138%2, where:
- "Bloomberg IBOR Fallback Rate Adjustments Rule Book" means the
IBOR Fallback Rate Adjustments Rule Book published by Bloomberg
Index Services Limited (or a successor provider as approved and/or
appointed by ISDA from time to time), as updated from time to time
in accordance with its terms;
- "Compounded CORRA" means term-adjusted CORRA
compounded-in-arrears, calculated by the calculation agent in
accordance with the methodology pursuant to which BISL (or a
successor provider as approved and/or appointed by ISDA from time
to time) calculated Three-Month Fallback Rate (CORRA), by reference
to the Bloomberg IBOR Fallback Rate Adjustments Rule Book. For the
avoidance of doubt, Compounded CORRA does not include the fixed
spread adjustment of 0.32138%.
- "Fallback Index Cessation Effective Date" means, in respect of
a Fallback Index Cessation Event, the first date on which
Three-Month Fallback Rate (CORRA) is no longer provided. If
Three-Month Fallback Rate (CORRA) ceases to be provided on a
Fallback Observation Day in respect of an interest period but it
was provided at the time at which it is to be observed on such
Fallback Observation Day, then the Fallback Index Cessation
Effective Date will be the next day on which the rate would
ordinarily have been published; and
- "Fallback Index Cessation Event" means: (a) a public statement
or publication of information by or on behalf of the administrator
or provider of Three-Month Fallback Rate (CORRA) announcing that it
has ceased or will cease to provide Three-Month Fallback Rate
(CORRA) permanently or indefinitely, provided that, at the time of
the statement or publication, there is no successor administrator
or provider that will continue to provide Three-Month Fallback Rate
(CORRA) or (b) a public statement or publication of information by
the regulatory supervisor for the administrator of Three-Month
Fallback Rate (CORRA), the Bank of Canada, an insolvency official with
jurisdiction over the administrator for Three-Month Fallback Rate
(CORRA), a resolution authority with jurisdiction over the
administrator for Three-Month Fallback Rate (CORRA) or a court or
an entity with similar insolvency or resolution authority over the
administrator for Three-Month Fallback Rate (CORRA), which states
that the administrator of Three-Month Fallback Rate (CORRA) has
ceased or will cease to provide Three-Month Fallback Rate (CORRA)
permanently or indefinitely, provided that, at the time of the
statement or publication, there is no successor administrator that
will continue to provide Three-Month Fallback Rate (CORRA).
In addition to the adjustments set forth above, the provisions
regarding the determination of interest rates and Three-Month
Fallback Rate (CORRA) set forth in Annex 4 represent adjustments to
the terms and provisions of to the Annex 1 CDOR Securities.
Adjustments to Terms and Provisions of Annex 2 CDOR
Securities
The following adjustments will be applicable to the terms and
provisions of the Annex 2 CDOR Securities for each floating rate
interest period commencing on or after the CDOR Replacement
Date:
- The calculation agent will not refer to the interest
determination date when determining the applicable interest rate
for a series of the Annex 2 CDOR Securities for a particular
interest period. Instead, the calculation agent will refer to the
applicable Fallback Observation Day, in accordance with the
description set forth in Annex 4.
- The calculation date for each floating rate interest period
will be the Fallback Observation Day for the applicable interest
period.
- The calculation agent will provide BAC, as issuer, and, upon
request, the holder of any Annex 2 CDOR Securities, Three-Month
Fallback Rate (CORRA), the interest rate and the amount of interest
accrued with respect to any interest period for such CDOR Security,
after Three-Month Fallback Rate (CORRA) and such interest rate and
accrued interest have been determined.
1 Issue Date of 3/28/2022 for additional notes issued in a
reopening of this series.
2 CARR has stated that
the difference between Three-Month Fallback Rate (CORRA) and the
rate referred to above is that Three-Month Fallback Rate (CORRA) is
a benchmark provided by BISL, while the rate referred to above is a
rate determined by the calculation agent using the same methodology
as BISL, and that such rates are economically the same, differing
only as to who calculates them. This footnote is explanatory only
and does not represent an adjustment to the terms and provisions of
the Annex 1 CDOR Securities.
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SOURCE Bank of America Corporation