HSBC plans annual income opportunity CDs due 2018 on industry titans

By Jennifer Chiou

New York, Dec. 6 - HSBC USA Inc. plans to price annual income opportunity CDs with auto cap due Dec. 31, 2018 linked to a basket of stocks, according to a pricing sheet.

The basket includes the common stocks of Altria Group, Inc., Amazon.com, Inc., Amgen Inc., Archer-Daniels-Midland Co., AT&T Inc., Barrick Gold Corp., General Mills, Inc., Halliburton Co., Intel Corp. and Mattel, Inc.

Interest is payable annually and will equal the average of the performances of the basket stocks, subject to a floor of 0.5%.

If a basket stock's return is zero or positive, its performance will be fixed at 5.5% to 7.5%. The exact auto cap rate will be determined at pricing. If a basket stock's return is negative, its performance will be the greater of the stock return and negative 30%.

The payout at maturity will be par.

The securities may be redeemed early, subject to an early withdrawal charge of 3.25% in the first year, 2.25% in the second year, 1.25% in the third year, 0.25% in the fourth year and zero in the three remaining years.

The CDs (Cusip: 40431GD48) are expect to price on Dec. 23 and settle on Dec. 29.

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

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