MERRILL LYNCH DEPOSITOR INC INDEXPLUS TRUST SERIES 2003-1

ITEM 1A. RISK FACTORS

Your investment in the trust certificates will involve certain risks. You should carefully consider the following discussion of risks, and the other information included or incorporated by reference in the applicable prospectus supplement and the accompanying prospectus. You should also carefully consider any risk factors and other information that the underlying securities issuer may file in its Exchange Act reports as referenced in the Documents Incorporated by Reference section above.

IF THE TRUST CERTIFICATES OR ANY OF THE UNDERLYING SECURITIES ARE REDEEMED PRIOR TO THEIR MATURITY DATE, YOU MAY NOT BE ABLE TO REINVEST YOUR REDEMPTION PROCEEDS AT A YIELD COMPARABLE TO THE YIELD YOU WOULD HAVE RECEIVED ON YOUR TRUST CERTIFICATES.

The yield you will realize on your trust certificates depends upon several factors, including:

The description of the underlying securities in the applicable prospectus supplement indicates which of the underlying securities can be redeemed prior to maturity at the option of the associated underlying securities issuer. Because the indicated underlying securities issuers have the right to redeem the indicated underlying securities early, we cannot assure you that the trust will be able to hold those underlying securities until their maturity date.

3

YOU MAY NOT BE PAID IF THE ASSETS OF THE TRUST ARE INSUFFICIENT

Distributions on the trust certificates will be made only from available assets of the trust. The trust will have no significant assets other than the portfolio of underlying securities. The trust certificates are not obligations of and do not represent any interests in the underwriter, the depositor, the trustee, the market agent, the calculation agent or any of their affiliates. Neither we nor the underwriter, the trustee, the market agent, the calculation agent or any other person or entity will be obligated to make any payments on the trust certificates from its own assets, and trust certificates holders will have no recourse against any of them or their respective assets. If the payments received from the underlying securities are insufficient to make distributions on the trust certificates, you may not receive all or part of the full amount due on your trust certificates.

NEITHER WE NOR THE TRUSTEE, THE UNDERWRITER, THE MARKET AGENT, THE CALCULATION AGENT NOR ANY OF THEIR AFFILIATES WILL MANAGE THE UNDERLYING SECURITIES

Except as described below, the trust will not dispose of any of the underlying securities, even if an event occurs that adversely affects any underlying securities issuer and/or the value of any or all of the underlying securities. Under the applicable trust agreement, the trust will dispose of an underlying security only if:

Under the above circumstances, the trustee must retain a market agent who will sell the defaulted underlying security on or after the 30th day after receipt of notice of the default in accordance with the sale procedures described in the applicable prospectus supplement and distribute the net proceeds from such sale to the holders of the trust certificates pro rata even if adverse market conditions exist. Neither the trustee nor the market agent has discretion to do otherwise. If adverse market conditions exist at the time of the sale of the underlying securities, you may incur greater losses than if the trust continued to hold the underlying securities and sold them at a later date.

4

THE VALUE OF THE TRUST CERTIFICATES DEPENDS UPON THE CREDITWORTHINESS OF THE UNDERLYING SECURITIES ISSUERS AND THE MARKET PRICES OF THE UNDERLYING SECURITIES.

The trust certificates represent interests in obligations of the underlying securities issuers and will be subject to all the risks associated with directly investing in each underlying securities issuers debt obligations. The underlying indenture and the terms and conditions governing each underlying security may not limit the amount of indebtedness that may be incurred by the relevant underlying securities issuer. In addition, an investment in the trust certificates represents an investment in the underlying securities and most of the underlying securities are not listed on any securities exchange. The underlying securities are generally purchased and sold through dealers who make a market in such securities for their own accounts, and there may be significant disparities in the prices quoted for any of the underlying securities by securities dealers at any point in time. Therefore, the market for any of the underlying securities is less liquid than the market for securities which are traded through a securities exchange and the aggregate market value of a comparable amount of the underlying securities may be higher than the market price of the trust certificates. You should consider the nature of each underlying security and the credit risk of each underlying securities issuer before making an investment decision regarding the trust certificates.

THE TRUST CERTIFICATEHOLDERS MAY SUFFER A LOSS UPON THE OCCURRENCE OF A REMOVAL EVENT

Should a removal event, as described in the applicable prospectus supplement, occur with respect to an underlying security, the trustee on behalf of the trust will instruct the market agent to sell such underlying security and distribute the net proceeds of the sale of such underlying security to the trust certificateholders. In such case, the certificate principal balance of the trust certificates will be reduced by the principal amount of the underlying security subject to such removal event. If the amount distributable to the trust certificateholders from the proceeds of the sale of the underlying securities subject to the removal event is less than the principal amount of such underlying securities plus any accrued and unpaid interest thereof the trust certificateholders will suffer a loss. Additionally, if less than all of such underlying securities are sold and the applicable underlying securities issuer defaults on payments due on such unsold underlying securities, the trust certificateholders will suffer a loss. The trust certificateholders will also bear the risk of reinvestment resulting from the reduction in the certificate principal balance of the trust certificates.

5

THE PASS-THROUGH RATE MAY BE REDUCED UPON PAYMENT OF PRINCIPAL ON OR THE OCCURRENCE OF A REMOVAL EVENT WITH RESPECT TO UNDERLYING SECURITIES

Because the pass-through rate on the trust certificates will be determined in part by the weighted average interest rate of the underlying securities, payments of principal on an underlying security or the occurrence of a removal event may cause the pass-through rate to decrease depending upon the interest rate of such underlying security.

AS UNDERLYING SECURITIES ARE REMOVED FROM THE TRUST AT THEIR MATURITY, REDEMPTION OR SALE, THE POOL OF UNDERLYING SECURITIES WILL BECOME LESS DIVERSIFIED AND YOUR EXPOSURE TO ECONOMIC FACTORS THAT DISPROPORTIONATELY AFFECT ONE OR MORE OF THE REMAINING UNDERLYING SECURITIES WILL INCREASE.

As underlying securities mature, underlying securities are redeemed or sold, or removal events occur, the pool of underlying securities held by the trust will become less diversified. These events could increase your risk of loss resulting from the decline in one or more of the economic factors disproportionately affecting any of the remaining underlying securities.

PRINCIPAL AND INTEREST PAYMENTS ON THE UNDERLYING SECURITIES ARE UNSECURED OBLIGATIONS OF THE UNDERLYING SECURITIES ISSUERS

Distributions on the trust certificates depend primarily on principal and interest payments on the underlying securities. Some of these payments are unsecured obligations of the underlying securities issuers. In any proceedings involving the insolvency, liquidation or winding up of an underlying securities issuer, holders of unsecured securities of that underlying issuer will be paid only after the holders of that underlying securities issuers secured obligations are paid in full. As a result, you may not recover the principal amount of your trust certificates attributable to such underlying security.

THE RATINGS OF THE TRUST CERTIFICATES MAY CHANGE

At the time of issuance, Moodys and/or Fitch Ratings assigned ratings to the trust certificates on the original issue date in one of the four highest categories assigned to long-term debt.

Any rating issued with respect to the trust certificates is not a recommendation to purchase, sell or hold a security. Ratings do not reflect upon the market price of the trust certificates or their suitability for a particular investor. We cannot assure you that initial ratings will remain for any given period of time or that a ratings agency would not revise or withdraw entirely the ratings if, in its judgment, circumstances (including, without limitation, the rating of any of the underlying securities) merit. A revision or withdrawal of a rating may adversely affect the market price of the trust certificates.

6

POTENTIAL CONFLICTS OF INTERESTS MAY ARISE BETWEEN US, THE UNDERWRITER AND THE TRUST

We, BofA Securities, Inc. (formerly known as Bank of America Merrill Lynch, the successor-in-interest to Merrill Lynch, Pierce, Fenner Smith Incorporated), or one of its affiliates acquired the underlying securities comprising the trusts portfolio. Potential conflicts of interests may arise as BofA Securities, Inc. and its affiliates may engage in investment banking or may provide other services for some or all of the underlying securities issuers. In addition, BofA Securities, Inc. and its affiliates may also own, make purchases or sales, including sales to the trust, establish long or short positions or engage in hedging activities in some or all of the underlying securities for their own accounts. All such activities may result in conflicts of interests among BofA Securities, Inc., its affiliates and the trust certificateholders.