HSBC plans currency appreciation coupon securities linked to yuan

By Jennifer Chiou

New York, May 6 - HSBC USA Inc. plans to price currency appreciation coupon securities due May 31, 2016 linked to the Chinese renminbi relative to the dollar, according to an FWP with the Securities and Exchange Commission.

Appreciation in the renminbi relative to the dollar will cause the spot rate to fall.

The securities will pay conditional annual coupon payments of 4.5% to 5% if the spot rate is less than the trigger rate on the coupon observation date. The trigger rate is 98% of the initial rate on May 25, 2012, 96% of the initial rate on May 28, 2013, 94% of the initial rate on May 27, 2014, 92% of the initial rate on May 26, 2015 and 90% of the initial rate on May 25, 2016.

The payout at maturity will be par plus, if any, the final conditional coupon.

The securities (Cusip: 4042K1HE6) will price on May 25 and settle on May 31.

HSBC Securities (USA) Inc. is the agent.

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