HSBC plans three-year annual income opportunity CDs on global titans

By Susanna Moon

Chicago, May 4 - HSBC Bank USA, NA plans to price annual income opportunity series 6 certificates of deposit due May 31, 2013 based on the performance of a basket of stocks, according to a term sheet.

The underlying companies are Apple Inc., Nokia Corp., Banco Bradesco SA, Potash Corp. of Saskatchewan Inc., EnCana Corp., Raytheon Co., GlaxoSmithKline plc, Taiwan Semiconductor Manufacturing Co. Ltd., Gold Fields Ltd., Teva Pharmaceutical Industries Ltd., Mechel and Unilever NV.

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

If a stock's return is flat or positive, its performance will be fixed at 5% to 8%, 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 30%.

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

The payout at maturity will be par.

The CDs will price on May 25 and settle on May 28.

HSBC Securities (USA) Inc. is the agent.

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