New Issue: HSBC prices $444,000 14.50% reverse convertibles linked to Lehman Brothers

By E. Janene Geiss

Philadelphia, Oct. 30 - HSBC USA Inc. priced $444,000 of reverse convertible notes due April 30, 2008 linked to the stock of Lehman Brothers Holdings Inc., according to a 424B2 filing with the Securities and Exchange Commission.

The six-month notes will pay 7.25% for an annualized rate of 14.50%. Interest will be payable monthly.

At maturity, investors will receive par unless the stock falls below the barrier price - 80% of the initial share price - during the life of the notes and finishes below the initial share price, in which case the payout will be a number of Lehman Brothers shares equal to $1,000 divided by the initial share price.

HSBC Securities (USA) Inc. is the agent.

Issuer:	HSBC USA Inc.
Issue:	Reverse convertible notes
Underlying stock:	Lehman Brothers Holdings Inc. (Symbol: LEH)
Amount:	$444,000
Maturity:	April 30, 2008
Coupon:	14.50%, payable monthly
Price:	Par
Payout at maturity:	Par in cash unless the stock falls below $48.3360 during the life of the notes and finishes below its initial price, in which case a number of Lehman Brothers shares equal to $1,000 divided by the initial price
Initial share price:	$60.42
Barrier price:	$48.336, or 80% of $60.42
Pricing date:	Oct. 26
Settlement date:	Oct. 31
Agent:	HSBC Securities (USA) Inc.
Fees:	2.25%

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