Published on 4/28/2008 in the Prospect News Structured Products Daily.
New Issue: HSBC Bank sells $801,000 10.3% reverse convertibles linked to stock basket
By E. Janene Geiss
Philadelphia, April 28 - HSBC Bank USA NA priced $801,000 of 10.3% annualized reverse convertible notes due Oct. 30, 2008 linked to a basket of stocks, according to a 424B2 filing with the Securities and Exchange Commission.
The basket consists of equal weights of Harley-Davidson, Inc. stock, NYSE Euronext stock, Humana Inc. stock and Paccar Inc. stock.
Interest will be payable monthly.
For each component of the basket, the payout at maturity will be one quarter of par in cash if the stock stays at or above the protection price, 65% of the stock's initial share price, during the life of the notes or finishes at or above the initial share price. Otherwise, the payout will be in the basket component's stock, with the number of shares equal to $1,000 divided by the stock's initial share price.
HSBC Securities (USA) Inc. is the agent.
| Issuer: | HSBC Bank USA NA
|
| Issue: | Reverse convertible notes
|
| Underlying basket: | Equal weights of Harley-Davidson, Inc. (HOG) stock, NYSE Euronext (NYX) stock, Humana Inc. (HUM) stock and Paccar Inc. (PCAR) stock
|
| Amount: | $801,000
|
| Maturity: | Oct. 30, 2008
|
| Coupon: | 10.3% annualized, payable monthly
|
| Price: | Par
|
| Payout at maturity: | For each stock, one quarter of par in cash if it stays at or above its protection price during the life of the notes or finishes at or above their initial share price; otherwise, a number of shares in the basket equal to $1,000 divided by the initial share price
|
| Initial share price: | $38.50 for Harley-Davidson, $66.82 for NYSE Euronext, $43.06 for Humana, $47.19 for Paccar
|
| Protection price: | $25.025 for Harley-Davidson, $43.433 for NYSE Euronext, $27.989 for Humana, $30.6735 for Paccar, 65% of initial prices
|
| Pricing date: | April 24
|
| Settlement date: | April 30
|
| Agent: | HSBC Securities (USA) Inc.
|
| Fees: | 1.5%
|
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