Merrill Lynch has returned to the Canadian structured products market for the first time since the completion of the US firm's acquisition by Bank of America over nine months ago.

October saw the firm launching four new notes, all branded under the Merrill Lynch Canada brand (MLC) with its new owner, Bank of America, acting as guarantor.

The securities include one income product with principal protection and three capital-at-risk growth products, ranging between 3.5 and four years. "We expect to resume an activity of three to five products a month, balancing the offerings between non-principal and principal-protected products," said Canada head of structured solutions Scott McBurney.

The income product, Canadian Stocks Principal Protected Yield Notes, links to a basket of 15 TSX-listed shares and pays an annual coupon equal to the average of the individual stock performances since inception, with each stock performance capped at 10.5% and floored at minus 25%.

The three capital-at-risk products are Accelerated Return products with upside leverage on underlyings including a basket of global indices (DJEurostoxx50, Nikkei225, S&PAsia50 and S&P500) for two World Opportunities Series available in Canadian dollar (165% participation) or US dollar (200% participation), and S&P/TSX60 (200% participation). Capital is reduced on a one-for-one basis if the index has fallen by maturity.

Earlier this year MLC indicated it would return to the market when it revamped its structured products website, including more detailed information such as underlying performance charts.

Distributing agents named for the new products include Nesbitt Burns, Canaccord Capital, CIBC, Citigroup Global Markets, Desjardins Securities, GMP Securities, HSBC Securities, Laurentian Bank Securities, National Bank Financial, RBC Dominion Securities, Scotia Capital and TD Securities.

MLC has favoured capital-at-risk issuance in the past, issuing 18 such products in 2008 and 22 in 2007. This contrasts with other Canadian issuers who launched a maximum of four capital-at-risk products over the same periods, with the exception of NBC, which issued about eight such products a year.

Recent months, however, have seen an upward trend for capital-at-risk products, with several issuers becoming more active in this segment, sometimes including a downside buffer. Asked if MLC would launch soft-protected structures, Scott replied, "Yes, if we think there is a market for it."

The new MLC range is available until 6 November 2009.

These products are available now in Recent Additions (Canada).