HSBC to price growth opportunity CDs linked to S&P 500 Low Volatility

By Angela McDaniels

Tacoma, Wash., April 2 - HSBC Bank USA, NA plans to price 0.25% to 0.35% growth opportunity certificates of deposit due April 26, 2019 linked to the S&P 500 Low Volatility index, according to a term sheet.

Interest will be payable annually. The exact interest rate will be set at pricing.

The payout at maturity will be par plus the index return, subject to a minimum payout of par.

The final level of the index will be the average of its closing levels on Jan. 23, April 23, July 23 and Oct. 23 of each year during the life of the notes beginning in July.

The issuer said it is generally willing to repurchase CDs from depositors at any time. It will pay the early redemption amount, which equals par plus any interest due plus the early redemption fee and less an early withdrawal charge of 3.5% in year one, 2.5% in year two, 1.5% in year three and zero after that. The early redemption fee is the current market value of the CDs minus any interest due and minus the principal amount of the CDs.

The CDs (Cusip: 40431GQ69) will price April 23 and settle April 26.

HSBC Securities (USA) Inc. is the agent.

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