New Issue: HSBC prices $110,000 14.25% reverse convertibles linked to Lehman Brothers

By Susanna Moon

Chicago, Jan. 29 - HSBC USA Inc. priced $110,000 of 14.25% reverse convertible notes due July 28, 2008 linked to the stock of Lehman Brothers Holdings Inc., according to a 424B2 filing with the Securities and Exchange Commission.

Interest is payable monthly.

At maturity, investors will receive par unless the stock falls below the barrier price - 70% 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. (NYSE: LEH)
Amount:	$110,000
Maturity:	July 28, 2008
Coupon:	14.25%, payable monthly
Price:	Par
Payout at maturity:	Par in cash unless the stock falls below the barrier price during the life of the notes and finishes below its initial price, in which case 16.4935 Lehman Brothers shares
Initial share price:	$60.63
Barrier price:	$42.441, or 70% of initial share price
Pricing date:	Jan. 28
Settlement date:	Jan. 31
Agent:	HSBC Securities (USA) Inc.
Fees:	2.25%

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