HSBC to price barrier optimization securities tied to S&P 500 via UBS

By Angela McDaniels

Tacoma, Wash., May 27 - HSBC USA Inc. plans to price 0% barrier optimization securities with partial protection due Sept. 17, 2010 linked to the S&P 500 index, according to an FWP filing with the Securities and Exchange Commission.

UBS Financial Services Inc. and Barclays Capital Inc. are the underwriters.

If the index closes above the index barrier on any day during the life of the notes, the payout at maturity will be par of $10 plus 8%. The index barrier is expected to be 133% to 140% of the initial index level and will be set at pricing.

Otherwise, the payout will be:

• Par plus the index return if the final index level is greater than the initial level;

• Par if the index declines by 15% or less; or

• Par minus 1% for every 1% that the index declines beyond 15%.

The securities are expected to price June 12 and settle June 17.

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