HSBC plans six-year annual income opportunity securities with sticky cap tied to 10 stocks

By Marisa Wong

Milwaukee, March 5 - HSBC USA Inc. plans to price annual income opportunity securities with sticky cap due March 31, 2016 linked to a basket of 10 common stocks, according to an FWP filing with the Securities and Exchange Commission.

The basket includes AT&T Inc., Chevron Corp., Chubb Corp., Coca-Cola Co., Fedex Corp., Ford Motor Co., Gilead Sciences Inc., Oracle Corp., Praxair Inc. and Sempra Energy.

Interest is payable annually and will equal the average of the returns on the basket stocks, subject to a floor of zero and a sticky cap of 7% to 8% that will be set at pricing. If on any coupon valuation date the return for any basket stock is equal to the sticky cap, the return for that stock will be set at the sticky cap for each succeeding valuation date, regardless of the stock's actual performance.

The payout at maturity will be par.

The securities will price March 26 and settle March 31.

HSBC Securities (USA) Inc. is the agent.

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