HSBC plans to price knock-out buffer notes linked to S&P 500 index

By Toni Weeks

San Diego, Jan. 24 - HSBC USA Inc. plans to price 0% knock-out buffer notes due Feb. 13, 2013 linked to the S&P 500 index, according to an FWP filing with the Securities and Exchange Commission.

A knock-out event occurs if the index falls by more than 24.25% on any day during the life of the notes.

If a knock-out event does not occur, the payout at maturity will be par plus the contingent return of 10%, or $1,100 per $1,000 principal amount of notes.

If a knock-out event occurs, the payout at maturity will be par plus the index return, subject to a maximum return of 10%. Investors will be fully exposed to losses.

The notes (Cusip: 4042K1WD1) are expected to price Jan. 27 and settle Feb. 1.

HSBC Securities (USA) Inc. is the underwriter with J.P. Morgan Securities LLC as the agent.

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