HSBC plans 8% to 11% one-year autocallable yield notes on three funds

By Jennifer Chiou

New York, May 2 - HSBC USA Inc. plans to price 8% to 11% autocallable yield notes due May 22, 2012 linked to the SPDR S&P Metals & Mining exchange-traded fund, the Oil Service Holdrs Trust and the Market Vectors Agribusiness ETF, according to an FWP with the Securities and Exchange Commission.

Interest will be payable quarterly.

The notes will be called at par if the underlying components close at or above their initial levels on any quarterly observation date.

A trigger event will occur if any fund closes below 70% of its initial level during the life of the notes.

The payout will be par if a trigger event does not occur or if a trigger event does occur but the return of the worst performing component is positive.

If a trigger event occurs and the return of the worst performing component is negative, investors will share in the decline of that component.

The notes (Cusip: 4042K1HF3) are expected to price on May 24 and settle on May 27.

HSBC Securities (USA) Inc. is the agent.

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