HSBC to price annual income opportunity CDs linked to global industry titans

By Angela McDaniels

Tacoma, Wash., July 1 - HSBC Bank USA, NA plans to price annual income opportunity certificates of deposit with auto cap feature due Aug. 1, 2016 linked to a basket of stocks, according to a term sheet.

The basket includes Amgen Inc., AstraZeneca plc, Barrick Gold Corp., Credit Suisse Group, Ebay Inc., Nike Inc., Petrochina Co. Ltd., Research In Motion Ltd., SAP AG, Sony Corp., UBS AG and Vodafone Group plc.

Interest is payable annually and will equal the average of the performances of the basket stocks, subject to a floor of zero.

If a basket stock's return is zero or positive, its performance will be fixed at 7% to 11%. If a basket stock's return is negative, its performance will be the greater of the stock return and negative 30%.

The payout at maturity will be par.

The CDs will be putable on Aug. 29, 2011, Aug. 29, 2012, Aug. 29, 2013, Aug. 29, 2014 and Aug. 31, 2015. Investors will receive the current market value of the CDs minus an early redemption charge of 4% in year one, 3% in year two, 2% in year three and 1% in year four. There is no redemption charge after that time.

The CDs (Cusip: 40431GBM0) will price July 27 and settle July 30.

HSBC Securities (USA) Inc. is the agent.

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