HSBC plans to sell six-year Far East Opportunity CDs with 1%-3% floor

By Marisa Wong

Madison, Wis., Aug. 3 - HSBC Bank USA, NA plans to price Far East Opportunity Certificates of Deposit due Aug. 28, 2017 linked to a basket of four Asian indexes, according to a term sheet.

The equally weighted basket components are the Hang Seng index, the Kospi 200 index, the MSCI Singapore Free index and the TWSE index.

The payout at maturity will be par plus any gain in the basket, subject to a minimum return of 1% to 3% that will be set at pricing. The basket return will be calculated using the average of the index returns measured on each quarterly observation date during the life of the notes.

The CDs are putable in whole at any time. Investors will be subject to an early redemption charge of 3% in year one, 2% in year two and 1% in year three. There is no early redemption charge for years four, five and six.

The CDs (Cusip: 40431GVZ9) are expected to price Aug. 22 and settle Aug. 26.

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

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