HSBC to price contingent annual income CDs linked to stock basket via Morgan Stanley

By Angela McDaniels

Tacoma, Wash., May 27 - HSBC Bank USA, NA plans to price contingent annual income certificates of deposit due June 30, 2015 linked to an equally weighted basket of 20 stocks, according to an FWP filing with the Securities and Exchange Commission.

Morgan Stanley & Co. Inc. is the agent.

The basket includes the class A common stock of Kraft Foods Inc. and the common stocks of 3M Co., Abbott Laboratories, AT&T Inc., Boeing Co., Chevron Corp., Exxon Mobil Corp., Entergy Corp., FPL Group, Inc., International Business Machines Corp., Johnson & Johnson, JPMorgan Chase & Co., McDonald's Corp., Microsoft Corp., Monsanto Co., Nucor Corp., Verizon Communications Inc., Wal-Mart Stores, Inc., Walt Disney Co. and Wells Fargo & Co.

Interest will be payable in June of each year and will equal the sum of the stocks' weighted returns. The interest rate will be subject to a floor of zero and a cap of 9.5% to 14.5%, with the exact cap to be set at pricing.

The payout at maturity will be par.

The CDs are expected to price June 23.

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