HSBC plans to price barrier optimization securities linked to S&P 500

By Angela McDaniels

Tacoma, Wash., Sept. 1 - HSBC USA Inc. plans to price 0% barrier optimization securities with partial protection due Dec. 30, 2010 linked to the S&P 500 index, according to an FWP filing with the Securities and Exchange Commission.

If the index closes above the index barrier during the life of the notes, the payout at maturity will be par of $10 plus 4%. The barrier is expected to be 130% to 136% of the initial index level and will be set at pricing.

If the index does not close above the barrier during the life of the notes, the payout will be:

• Par plus the index return if the index return is positive;

• Par if the index return is between zero and negative 15%; or

• Par minus 1% for every 1% that the index return is less than negative 15%.

The notes are expected to price Sept. 25 and settle Sept. 30.

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

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