New Issue: HSBC sells $100,000 of 10.7% reverse convertibles linked to National Oilwell Varco

By Laura Lutz

Des Moines, June 26 - HSBC USA Inc. priced $100,000 of 10.7% reverse convertible notes due Dec. 28, 2007 linked to the common stock of National Oilwell Varco, Inc., according to a 424B2 filing with the Securities and Exchange Commission.

Interest will be payable monthly.

At maturity, investors will receive par unless National Oilwell stock falls below the protection 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 National Oilwell shares equal to $1,000 divided by the initial share price.

HSBC Securities (USA) Inc. will be the agent.

Issuer:	HSBC USA Inc.
Issue:	Reverse convertible notes
Underlying stock:	National Oilwell Varco, Inc.
Amount:	$100,000
Maturity:	Dec. 28, 2007
Coupon:	10.7%, payable monthly
Price:	Par
Payout at maturity:	Par in cash unless National Oilwell stock falls below $87.144 during the life of the notes and finishes below its initial price, in which case shares of National Oilwell equal to $1,000 divided by the initial price
Initial share price:	$108.93
Barrier price:	$87.144, 80% of $108.93
Pricing date:	June 22
Settlement date:	June 27
Agent:	HSBC Securities (USA) Inc.
Fees:	2.5%

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