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HSBC plans annual income opportunity CDs on 'global industry titans'
By Marisa Wong
Madison, Wis., June 5 - HSBC Bank USA, NA plans to price annual income opportunity CDs with auto cap due July 1, 2019 linked to a basket of stocks, according to a pricing sheet.
The basket includes the common stocks of AstraZeneca plc, Encana Corp., General Mills, Inc., Gerdau SA, Home Depot, Inc., Icici Bank Ltd., Randgold Resources Ltd., Taiwan Semiconductor Manufacturing Co. Ltd., Unilever NV and Vodafone Group plc.
Interest is payable annually and will equal the average of the performances of the basket stocks, subject to a floor of zero.
If a basket stock's return is zero or positive, its performance will equal the auto cap rate, which will be at least 6% and will be set 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% in year one, 2% in year two and 1% in year three. There is no early withdrawal charge for years four through seven.
The CDs (Cusip: 40431GV71) are expected to price on June 26 and settle on June 29.
HSBC Securities (USA) Inc. will be the agent.
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