HSBC plans five-year annual income opportunity CDs on U.S. titans

By Susanna Moon

Chicago, May 4 - HSBC Bank USA, NA plans to price annual income opportunity series 6 certificates of deposit due May 27, 2015 based on the performance of a basket of stocks, according to a term sheet.

The underlying companies are AT&T Inc., Boeing Co., Campbell Soup Co., Celgene Corp., Chubb Corp., Cigna Corp., E.I. DuPont de Nemours & Co., Freeport-McMoran Copper & Gold Inc., Microsoft Corp., Peabody Energy Corp., Qualcomm Inc. and Southern Co.

Interest is payable annually and will equal the average of the performances of the basket stocks, with a floor of 0.5%.

If a stock's return is flat or positive, its performance will be fixed at 8% to 12%, with the exact percentage to be set at pricing. If the stock's return is negative, its performance will be the greater of the return and negative 50%.

The payout at maturity will be par.

The CDs are putable on June 30, 2011, June 29, 2012, June 28, 2013 and June 30, 2014.

The CDs will price on May 21 and settle on May 26.

HSBC Securities (USA) Inc. is the agent.

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