HSBC to price five-year annual income opportunity CDs linked to U.S. industry titans

By Angela McDaniels

Tacoma, Wash., July 1 - HSBC Bank USA, NA plans to price annual income opportunity certificates of deposit with auto cap feature due July 30, 2015 linked to a basket of stocks, according to a term sheet.

The basket includes Biogen Idec Inc., Dominion Resources Inc., Ford Motor Co., General Electric Co., Las Vegas Sands Corp., McDonald's Corp., Newmont Mining Corp., Nucor Corp., Procter & Gamble Co., Sandisk Corp., U.S. Bancorp and Valero Energy Corp.

Interest is payable annually and will equal the average of the performances of the basket stocks, subject to a minimum coupon of 0.5% per year.

If a basket stock's return is zero or positive, its performance will be fixed at 7% to 11%. If a basket stock's return is negative, its performance will be the greater of the stock return and negative 50%.

The payout at maturity will be par.

The CDs will be putable on Aug. 29, 2011, Aug. 29, 2012, Aug. 29, 2013 and Aug. 29, 2014. Investors will receive the current market value of the CDs.

The CDs (Cusip: 40431GCC1) will price July 27 and settle July 30.

HSBC Securities (USA) Inc. is the agent.

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