Royal Bank of Canada Launches New Auto-Callable Index-Linked Notes

Royal Bank of Canada has launched a new financial product, the Auto-Callable Contingent Coupon Barrier Notes with Memory Coupon, linked to the Bloomberg US Large Cap VolMax Index. These notes, with a total offering of $500,000, are set to mature on October 7, 2031. The product includes a contingent coupon feature with a memory component, allowing unpaid coupons to be carried forward if certain conditions are met.

The notes offer a contingent coupon rate of 13.00% per annum, payable monthly if the index's value meets or exceeds the coupon threshold of 60% of its initial value. The notes also feature an auto-call provision: if the index's value meets or exceeds its initial value on any call observation date starting approximately one year after the trade date, the notes will be automatically redeemed at 100% of their principal amount plus any accrued coupons.

At maturity, investors' principal is contingent on the index's performance relative to the barrier value set at 40% of the initial value. If the index falls below this barrier, investors will lose 1% of their principal for every 1% the index is below the initial value. The initial estimated value of the notes is $932.20 per $1,000 principal amount, which is less than the public offering price.

The notes are not listed on any securities exchange and are subject to the credit risk of Royal Bank of Canada. The offering includes underwriting discounts and commissions, with proceeds to the bank amounting to $496,250 after these deductions.