UBS AG is offering digital S&P 500-linked medium-term notes with no interest payments and a buffer set at 90.00% of the initial index level. Investors’ Maturity payment will depend on the index’s performance, while buying above or below face amount can change returns and the buffer’s effect.

Key Highlights

  • UBS AG’s digital notes will not pay interest and will link the maturity amount to the S&P 500 Index.
  • The notes use a buffer level equal to 90.00% of the index’s initial level.
  • UBS Securities LLC will purchase the notes from UBS AG for distribution to registered broker-dealers.

90% Buffer Anchors Maturity Payment

The securities will not bear interest, and the preliminary terms remain subject to completion. The notes use an initial underlier level based on the S&P 500 Index’s closing level on the trade date. A buffer level of 90.00% of that starting level applies on the determination date, with the amount payable at stated maturity tied to whether the final underlier level is equal to or above that threshold. The stated maturity date is expected to fall after the determination date. UBS Securities LLC, an affiliate of UBS AG, will buy the notes from UBS AG for distribution to registered broker-dealers. The securities are not bank deposits and do not carry insurance from the Federal Deposit Insurance Corporation or another government agency. The preliminary terms say UBS AG may sell additional aggregate face amount after the final pricing supplement. Any later sale may carry different issue prices, Underwriting discounts and net proceeds, while the return will depend in part on the price paid by the purchaser. The notes are intended to be treated for U.S. tax purposes as prepaid derivative contracts tied to the underlier, subject to possible disagreement by the Internal Revenue Service.