HSBC plans three-year barrier multi-coupon opportunity CDs linked to Russell 2000

By Angela McDaniels

Tacoma, Wash., June 2 - HSBC Bank USA, NA plans to price 0% barrier multi-coupon opportunity certificates of deposit due June 25, 2013 linked to the Russell 2000 index, according to a term sheet.

The CDs will pay a coupon in June of each year. If the index remained at or below the barrier level throughout the previous year, the coupon will be equal to the greater of the index return and zero. If the index was ever above the barrier, no coupon will be paid.

The barrier will be 115% to 120% of the initial index level for the first year and will increase to 125% of the initial level in the second year and to 135% in the third year. The exact barrier for the first year will be set at pricing.

The payout at maturity will be par.

The CDs will be putable at their market value on June 27, 2011 and June 25, 2012.

The CDs (Cusip: 40431GAW9) will price June 22 and settle June 25.

HSBC Securities (USA) Inc. is the agent.

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