Banks Sell Most Structured Notes Tied to JPMorgan in Two Years

Banks sold $85.6 million of notes tied to the stock price of JPMorgan Chase & Co. (JPM) in November, the biggest month for securities tied to the company since December 2010.

The largest offering was $37.6 million of three-year auto- callable notes sold by UBS AG (UBSN) on Nov. 30. The securities yield 10.7 percent a year as long as the share price doesn’t fall below 75 percent of its initial value of $41.08 with all capital at risk, according to a prospectus filed with the U.S. Securities and Exchange Commission. UBS can call the notes quarterly starting in March. It distributed the securities for a 2.25 percent fee.

Investors have bought $289.9 million of notes tied to the largest U.S. bank by assets this year, the most referencing any bank and 40 percent more than through the end of November 2011, according to data compiled by Bloomberg. Banks sold $111.4 million of notes tied to shares of Wells Fargo & Co. (WFC), the next biggest-selling bank used as a reference.

Shares of JPMorgan Chase have gained 24 percent to $41.20 as of closing yesterday. The Standard & Poor’s 500 Index increased 12 percent this year to 1,409.3.

To contact the reporter on this story: Kevin Dugan in New York at kdugan4@bloomberg.net

To contact the editor responsible for this story: Alan Goldstein at agoldstein5@bloomberg.net