New Issue: HSBC prices $5 million 97% protected absolute peak return barrier notes tied to Russell 2000

By Jennifer Chiou

New York, July 17 - HSBC USA Inc. priced $5 million of zero-coupon 97% principal protection absolute peak return barrier notes due July 15, 2009 linked to the Russell 2000 index, according to a 424B2 filing with the Securities and Exchange Commission.

If the index never closes above or below its initial level by more than the barrier amount, the payout at maturity will be par of $10 plus the absolute value of the highest positive or lowest negative index return on any trading day during the life of the notes. Otherwise, the payout will be 97% of par.

The barrier amount is 20.3%.

UBS Financial Services Inc. and HSBC USA Inc. are the underwriters.

Issuer:	HSBC USA Inc.
Issue:	97% principal protection absolute peak return barrier notes
Underlying index:	Russell 2000
Amount:	$5 million
Maturity:	July 15, 2009
Coupon:	0%
Price:	Par of $10
Payout at maturity:	If the index never closes outside the barrier levels, par plus the absolute value of the highest positive or lowest negative index return on any trading day during the life of the notes; otherwise, 97% of par
Initial index level:	662.35
Upper index barrier:	796.81, 120.3% of initial index level
Lower index barrier:	527.89, 79.7% of initial index level
Pricing date:	July 15
Settlement date:	July 18
Underwriters:	UBS Financial Services Inc., HSBC USA Inc.
Fees:	1.25%

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