Unassociated Document

424B2 1 v182744_424b2.htm Unassociated Document

CALCULATION OF REGISTRATION FEE

Title of Class of Securities Offered	Maximum Aggregate Offering Price	Amount of Registration Fee (1)
HSBC USA Inc. Autocallable Optimization Securities with Contingent Protection Linked to the Common Stock of Bank of America Corporation due on or about May 2, 2011	$73,307,630	$5,226.83

(1) Calculated in accordance with Rule 457(r) of the Securities Act of 1933, as amended.

PRICING SUPPLEMENT

Filed Pursuant to Rule 424(b)(2)

Registration Statement No. 333-158385

Dated April 27, 2010

HSBC USA Inc. $73,307,630 Autocallable Optimization Securities with Contingent Protection Linked to the Common Stock of Bank of America Corporation due on or about May 2, 2011

Investment Description

These Autocallable Optimization Securities with Contingent Protection Linked to the common stock of Bank of America Corporation, are senior unsecured notes issued by HSBC USA Inc., which we refer to as the “Securities”. The Securities are designed for investors who want to express a neutral or bullish view of the performance of shares of Bank of America Corporation (the “Reference Shares”). If the Closing Price of a Reference Share on any monthly Observation Date is at or above the Initial Share Price of a Reference Share, the Securities will be called for an annualized return of 19.08%. If the Securities are not called, at maturity you will receive your Principal Amount unless the Final Share Price is below the Trigger Price on the Final Valuation Date, in which case you will receive a payment equal to the Principal Amount of your Securities reduced by 1 percent for each 1 percent of any negative percentage return of the Reference Shares at maturity. Investing in the Securities involves significant risks. You must be willing to risk losing up to 100% of your investment. The contingent protection feature applies only if you hold the Securities to maturity. Any payment on the Securities, including any principal protection feature, is subject to the creditworthiness of HSBC.

Features

Tactical Investment Opportunity: If you believe the Reference Shares will appreciate in value over the term of the Securities but are unsure about the exact timing or magnitude of the appreciation, the Securities provide an opportunity to generate returns based on this market view. The Securities will be automatically called for par plus the call return if the Closing Price of a Reference Share on any Observation Date is equal to or greater than the Closing Price of a Reference Share on the Trade Date. If the Securities are not called, investors will have downside market exposure to the Reference Shares at maturity, subject to the contingent protection feature.

Contingent Protection Feature: If the Securities are not called and you hold the Securities to maturity and the Final Share Price is not below the Trigger Price on the Final Valuation Date, you will receive at least 100% of your principal, subject to the creditworthiness of HSBC USA Inc. If the Final Share Price is below the Trigger Price on the Final Valuation Date, your investment will be fully exposed to the negative Reference Share Return and you will lose some or all of your initial investment.

Key Dates

Trade Date	April 27, 2010
Settlement Date	April 30, 2010
Final Valuation Date1	April 26, 2011
Maturity Date1	May 2, 2011

1 Subject to postponement in the event of a Market Disruption Event.

Security Offering

We are offering the Securities, which are linked to the performance of the Reference Shares, at a minimum investment of $1,000 in denominations of $10 and integral multiples thereof.

Reference Share Issuer	Call Return Rate	Initial Share Price	Trigger Price	CUSIP	ISIN
Bank of America Corporation	An annualized return of 19.08%	$17.47	$12.23, which is 70.00% of the Initial Share Price	40432R302	US40432R3021

See “Additional Information about HSBC USA Inc. and the Securities” on page 2 of this pricing supplement. The Securities offered will have the terms specified in the accompanying prospectus dated April 2, 2009, the accompanying prospectus supplement dated April 9, 2009 and the terms set forth herein. See “Key Risks” on page 7 of this pricing supplement and the more detailed “Risk Factors” beginning on page S-3 of the accompanying prospectus supplement for risks related to the Securities.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of the securities or passed upon the accuracy or the adequacy of this document, the accompanying prospectus or prospectus supplement. Any representation to the contrary is a criminal offense. The Securities are not deposit liabilities or other obligations of a bank and are not insured by the Federal Deposit Insurance Corporation or any other governmental agency of the United States or any other jurisdiction.

The Securities will not be listed on any U.S. securities exchange or quotation system. HSBC Securities (USA) Inc., an affiliate of HSBC USA Inc., will purchase the notes from HSBC USA Inc. for distribution to UBS Financial Services Inc., acting as agent. See “Supplemental Plan of Distribution (Conflicts of Interest)” on the last page of this pricing supplement for the distribution arrangement.

	Price to Public	Underwriting Discount	Proceeds to Us
Per Security	$10	$0.125	$9.875
Total	$73,307,630	$916,345.38	$73,391,284.62

UBS Financial Services Inc.

HSBC USA Inc.

Additional Information about HSBC USA Inc. and the Securities

This pricing supplement relates to the offering of Securities linked to the Reference Shares identified on the cover page. The Reference Shares described in this pricing supplement are a reference asset as defined in the prospectus supplement, and these Securities being offered hereby are “Notes” for purposes of the prospectus supplement. As a purchaser of a Security, you will acquire an investment instrument linked to the Reference Shares. Although the offering of Securities relates to the Reference Shares identified on the cover page, you should not construe that fact as a recommendation of the merits of acquiring an investment linked to the Reference Shares, or as to the suitability of an investment in the Securities.

You should read this document together with the prospectus dated April 2, 2009 and the prospectus supplement dated April 9, 2009. If the terms of the securities offered hereby are inconsistent with those described in the accompanying prospectus supplement or prospectus, the terms described in this pricing supplement shall control. You should carefully consider, among other things, the matters set forth in “Key Risks” beginning on page 7 of this pricing supplement and in “Risk Factors” beginning on page S-3 of the prospectus supplement, as the Securities involve risks not associated with conventional debt securities. HSBC urges you to consult your investment, legal, tax, accounting and other advisers before you invest in the Securities.

HSBC USA Inc. has filed a registration statement (including a prospectus and prospectus supplement) with the U.S. Securities and Exchange Commission, or the SEC, for the offering to which this pricing supplement relates. Before you invest, you should read the prospectus and prospectus supplement in that registration statement and other documents HSBC USA Inc. has filed with the SEC for more complete information about HSBC USA Inc. and this offering. You may get these documents for free by visiting EDGAR on the SEC’s web site at www.sec.gov. Alternatively, HSBC USA Inc. or any dealer participating in this offering will arrange to send you the prospectus and prospectus supplement if you request them by calling toll-free 1-866-811-8049.

You may access these documents on the SEC web site at www.sec.gov as follows:

Prospectus supplement dated April 9, 2009:

http://www.sec.gov/Archives/edgar/data/83246/000114420409019785/v145824_424b2.htm

Prospectus dated April 2, 2009:

http://www.sec.gov/Archives/edgar/data/83246/000104746909003736/a2192100zs-3asr.htm

As used herein, references to the “Issuer,” “HSBC”, “we,” “us” and “our” are to HSBC USA Inc. References to the “prospectus supplement” mean the prospectus supplement dated April 9, 2009 and references to the “accompanying prospectus” mean the HSBC USA Inc. prospectus, dated April 2, 2009.

Terms

Issuer	HSBC USA Inc. (A1/AA-/AA)1 (“HSBC”)
Principal Amount	$10 per security (subject to a minimum investment of $1,000).
Term	12 months, unless earlier called.
Trade Date	April 27, 2010
Settlement Date	April 30, 2010
Final Valuation Date	April 26, 2011, subject to adjustment in the event of a Market Disruption Event.
Maturity Date	May 2, 2011, subject to adjustment in the event of a Market Disruption Event.
Reference Shares	Shares of Bank of America Corporation (Ticker: BAC)
Call Feature	The Securities will be called if the Closing Price of a Reference Share on any Observation Date is at or above the Initial Share Price.
Observation Dates	May 24, 2010, June 24, 2010, July 26, 2010, August 25, 2010, September 24, 2010, October 25, 2010, November 23, 2010, December 27, 2010, January 25, 2011, February 22, 2011, March 25, 2011 and the Final Valuation Date (April 26, 2011), each subject to postponement in the event of a Market Disruption Event.
Call Settlement Dates	With respect to the first eleven Observation Dates, four business days following the applicable Observation Date. For the Final Valuation Date the Call Settlement Date will be the Maturity Date.
Return on Call Date	If the Securities are called, on the corresponding Call Settlement Date, investors will receive a cash payment per $10 principal amount of Securities equal to the Call Price for the applicable Observation Date. The Return on Call Date will be based upon an annualized return of 19.08%.
	Expected Observation Date May 24, 2010 June 24, 2010 July 26, 2010 August 25, 2010 September 24, 2010 October 25, 2010 November 23, 2010 December 27, 2010 January 25, 2011 February 22, 2011 March 25, 2011 Final Valuation Date (April 26, 2011)	Return on Call Date2 1.59% 3.18% 4.77% 6.36% 7.95% 9.54% 11.13% 12.72% 14.31% 15.90% 17.49% 19.08%	Call Price (per $10.00 security) $10.16 $10.32 $10.48 $10.64 $10.80 $10.95 $11.11 $11.27 $11.43 $11.59 $11.75 $11.91
Payment at Maturity (per $10 Security)	If the Securities are not called, you will receive a payment on the Maturity Date calculated as follows: If the Final Share Price of a Reference Share is not below the Trigger Price on the Final Valuation Date, you will receive a cash payment on the Maturity Date equal to $10 per $10 principal amount of Securities.3 If the Final Share Price of a Reference Share is below the Trigger Price on the Final Valuation Date, you will receive a cash payment on the Maturity Date equal to: $10 × (1 + Reference Share Return); In this case, you will lose some or all of your principal amount, depending on how much the price of a Reference Share decreases during the Observation Period.
Reference Share Return	Final Share Price - Initial Share Price
	Initial Share Price
Trigger Price	$12.23, which is 70.00% of the Initial Share Price.
Observation Period	The period from, but excluding, the Trade Date to, and including, the Final Valuation Date.
Initial Share Price	$17.47, which is the Closing Price of a Reference Share on the Trade Date.

Determining Payment Upon Call or at Maturity

Your Securities are not fully principal protected. If the Reference Share Return is negative and the Final Share Price of the Reference Share is below the Trigger Price on the Final Valuation Date, the contingent protection is lost and your principal amount will be fully exposed to a loss resulting from any decrease in the price of a Reference Share.

1 HSBC USA Inc. is rated A1 by Moody’s, AA- by Standard & Poor’s and AA by Fitch Ratings. A credit rating reflects the creditworthiness of HSBC USA Inc. and is not a recommendation to buy, sell or hold securities, and it may be subject to revision or withdrawal at any time by the assigning rating organization. The securities themselves have not been independently rated. Each rating should be evaluated independently of any other rating. However, because the return on the Securities is dependent upon factors in addition to our ability to pay our obligations under the Securities, such as the Closing Price, an improvement in our credit ratings, financial condition or results of operations is not expected to have a positive effect on the trading value of the Securities.

2 Reflecting the annualized return of 19.08%.

3 Contingent principal protection is provided by HSBC USA Inc. and, therefore, is dependent on the ability of HSBC USA Inc. to satisfy its obligations when they come due.

Final Share Price	The Closing Price of a Reference Share on the Final Valuation Date.
Closing Price	The closing price on any scheduled trading day during the Observation Period will be the official price of one Reference Share on the Relevant Exchange (as defined herein) as of the close of the regular trading session of such exchange and as reported in the official price determination mechanism for such exchange, as adjusted by the calculation as described under “Anti-dilution and Reorganization Adjustments” below.
Calculation Agent	HSBC USA Inc. or one of its affiliates.
Trustee	Notwithstanding anything contained in the accompanying prospectus supplement to the contrary, the Securities will be issued under the senior indenture dated March 31, 2009, between HSBC USA Inc., as Issuer, and Wells Fargo Bank, National Association, as Trustee. Such indenture has substantially the same terms as the indenture described in the accompanying prospectus supplement.
Paying Agent	HSBC Bank USA, N.A. will act as paying agent with respect to the Securities pursuant to a Paying Agent and Securities Registrar Agreement dated June 1, 2009, between HSBC USA Inc. and HSBC Bank USA, N.A.

Investor Suitability
The Securities may be suitable for you if: ¨ You believe the Final Share Price of a Reference Share will not be below the Trigger Price on the Final Valuation Date, but you are willing to lose up to 100% of your principal if the Final Share Price is below the Trigger Price on the Final Valuation Date. ¨ You believe the Closing Price of a Reference Share will be at or above the Initial Share Price on at least one Observation Date, including the Final Valuation Date. ¨ You believe the Reference Shares will remain stable for the term of the Securities and will close at or above the Initial Share Price on the Final Valuation Date. ¨ You are willing to hold Securities that will be called on any Observation Date on which the price of a Reference Share closes at or above the Initial Share Price, or you are otherwise willing to hold the Securities to maturity. ¨ You are willing to make an investment whose return is limited to the pre-specified return on any Call Date, a total return based upon an annualized return of 19.08%. ¨ You do not seek current income from this investment. ¨ You are comfortable with the creditworthiness of HSBC, as issuer of the Securities. ¨ You do not seek an investment for which there is an active secondary market.		The Securities may not be suitable for you if: ¨ You believe the Final Share Price of a Reference Share will be below the Trigger Price on the Final Valuation Date. ¨ You believe that at maturity the Reference Share Return will be negative. ¨ You seek an investment that is 100% principal protected. ¨ You are not willing to make an investment in which you could lose up to 100% of your principal amount. ¨ You seek an investment whose return is not limited to the pre-specified return on any call date, an annualized return of 19.08%. ¨ You seek an investment for which there will be an active secondary market. ¨ You are unable or unwilling to hold securities that will be called on any Observation Date on which the Closing Price of a Reference Share is at or above the Initial Share Price, or you are otherwise unable or unwilling to hold the Securities to maturity. ¨ You prefer the lower risk, and therefore accept the potentially lower returns, of fixed income investments with comparable maturities issued by HSBC or another issuer with a similar credit rating. ¨ You seek current income from your investment. ¨ You are not willing or are unable to assume the credit risk associated with HSBC, as issuer of the Securities.

The suitability considerations identified above are not exhaustive. Whether or not the Securities are a suitable investment for you will depend on your individual circumstances, and you should reach an investment decision only after you and your investment, legal, tax, accounting and other advisors have carefully considered the suitability of an investment in the Securities in light of your particular circumstances. You should also review “Key Risks” on page 7 and “Risk Factors” on page S-3 of the prospectus supplement.

What are the tax consequences of the Securities?

You should carefully consider, among other things, the matters set forth in the section “Certain U.S. Federal Income Tax Considerations” in the prospectus supplement. The following discussion summarizes certain of the material U.S. federal income tax consequences of the purchase, beneficial ownership, and disposition of each of the Securities. This summary supplements the section “Certain U.S. Federal Income Tax Considerations” in the prospectus supplement and supersedes it to the extent inconsistent therewith. This summary does not address the tax consequences that may be relevant to persons that own in the aggregate, directly or indirectly (including by reason of investing in the Securities), more than 5% of the issuer of the Reference Shares. Notwithstanding any disclosure in the accompanying prospectus supplement to the contrary, HSBC’s special U.S. tax counsel in this transaction is Sidley Austin LLP.

There are no statutory provisions, regulations, published rulings or judicial decisions addressing the characterization for U.S. federal income tax purposes of securities with terms that are substantially the same as those of the Securities. Under one reasonable approach, the Securities should be treated as pre-paid forward or other executory contracts with respect to the Reference Shares. HSBC intends to treat the Securities consistent with this approach, and pursuant to the terms of the Securities, you agree to treat the Securities under this approach for all U.S. federal income tax purposes. Subject to certain limitations described in the prospectus supplement, and based on certain factual representations received from HSBC, in the opinion of HSBC’s special U.S. tax counsel, Sidley Austin LLP, it is reasonable to treat the Securities in accordance with this approach. Pursuant to this approach, HSBC does not intend to report any income or gain with respect to the Securities prior to their maturity or an earlier sale, exchange or call and HSBC intends to treat any gain or loss upon maturity or an earlier sale, exchange or call as either short-term or long-term capital gain or loss, depending on your holding period in the Security at such time for U.S. federal income tax purposes. See “Certain U.S. Federal Income Tax Considerations — Certain Equity-Linked Notes — Certain Notes Treated as Forward Contracts or Executory Contracts” in the prospectus supplement for certain U.S. federal income tax considerations applicable to securities that are treated as pre-paid cash-settled forward or other executory contracts.

HSBC will not attempt to ascertain whether the issuer of the Reference Shares would be treated as a United States real property holding corporation (“USRPHC”), as defined for U.S. federal income tax purposes. If the issuer of the Reference Shares were so treated, certain adverse U.S. federal income tax consequences might apply. You should refer to information filed with the SEC by the issuer of the Reference Shares and consult your tax advisor regarding the possible consequences to you if the issuer of the Reference Share is or becomes a USRPHC.

Because there are no statutory provisions, regulations, published rulings or judicial decisions addressing the characterization for U.S. federal income tax purposes of securities with terms that are substantially the same as those of the Securities, other characterizations and treatments are possible and the timing and character of income in respect of the Securities might differ from the treatment described above. For example, the Securities could be treated as debt instruments that are “contingent payment debt instruments” for U.S. federal income tax purposes, subject to the treatment described under the heading “Certain U.S. Federal Income Tax Considerations — U.S. Federal Income Tax Treatment of Notes as Indebtedness for U.S. Federal Income Tax Purposes — Contingent Payment Debt Instruments” in the prospectus supplement.

In Notice 2008-2, the Internal Revenue Service (“IRS”) and the Treasury Department requested comments as to whether the purchaser of an exchange traded note or prepaid forward contract (which may include the Securities) should be required to accrue income during its term under a mark-to-market, accrual or other methodology, whether income and gain on such a note or contract should be ordinary or capital, and whether foreign holders should be subject to withholding tax on any deemed income accrual. Accordingly, it is possible that regulations or other guidance could provide that a U.S. holder of a Security is required to accrue income in respect of the Securities prior to the receipt of payments with respect to the Securities or their earlier sale. Moreover, it is possible that any such regulations or other guidance could treat all income and gain of a U.S. holder in respect of the Securities as ordinary income (including gain on a sale). Finally, it is possible that a non-U.S. holder (as defined in the prospectus supplement) of the Securities could be subject to U.S. withholding tax in respect of the Securities. It is unclear whether any regulations or other guidance would apply to the Securities (possibly on a retroactive basis). Prospective investors are urged to consult with their tax advisors regarding Notice 2008-2 and the possible effect to them of the issuance of regulations or other guidance that affects the U.S. federal income tax treatment of the Securities.

PROSPECTIVE PURCHASERS OF SECURITIES SHOULD CONSULT THEIR TAX ADVISORS AS TO THE U.S. FEDERAL, STATE, LOCAL, AND OTHER TAX CONSEQUENCES TO THEM OF THE PURCHASE, OWNERSHIP AND DISPOSITION OF SECURITIES.

Key Risks

An investment in the Securities involves significant risks. Some of the risks that apply to the Securities are summarized here, but HSBC urges you to read the more detailed explanation of risks relating to the Securities generally in the “Risk Factors” section of the accompanying prospectus supplement. HSBC also urges you to consult your investment, legal, tax, accounting and other advisers before you invest in the Securities.

Contingent Principal Protection Applies Only in Limited Circumstances and Otherwise You May Lose Up to 100% of Your Initial Investment – Your principal amount will be protected only if you hold the Security to maturity and the Final Share Price of a Reference Share is not below the Trigger Price on the Final Valuation Date. The Securities differ from ordinary debt securities in that we will not pay you 100% of the principal amount of your Securities if the Final Share Price of a Reference Share is below the Trigger Price on the Final Valuation Date. In that event, the contingent protection will be lost and, at maturity, you will be fully exposed to the loss resulting from the decrease in the price of the Reference Shares. Accordingly, you may lose up to 100% of your principal amount.

Certain Built-in Costs are Likely to Adversely Affect the Value of the Securities Prior to Maturity – You should be willing to hold your Securities to maturity. The Securities are not designed to be short-term trading instruments. The price at which you will be able to sell your Securities to us, our affiliates or any party in the secondary market prior to maturity, if at all, may be at a substantial discount from the principal amount of the Securities, even in cases where the Reference Shares have appreciated since the Trade Date.

Reinvestment Risk – If your Securities are called early, the holding period over which you would receive the per annum return of 19.08% could be as little as one month. There is no guarantee that you would be able to reinvest the proceeds from an investment in the Securities at a comparable return for a similar level of risk in the event the Securities are called prior to the Maturity Date.

Credit of Issuer – The Securities are senior unsecured debt obligations of the issuer, HSBC, and are not, either directly or indirectly, an obligation of any third party. Any payment to be made on the Securities, including any principal protection at maturity, depends on the ability of HSBC to satisfy its obligations as they come due. As a result, the actual and perceived creditworthiness of HSBC may affect the market value of the Securities and, in the event HSBC were to default on its obligations, you may not receive the contingent principal protection or any other amounts owed to you under the terms of the Securities.

Single Stock Risk — The price of the Reference Shares can rise or fall sharply due to factors specific to the Reference Shares and their issuer, such as stock price volatility, earnings, financial conditions, corporate, industry and regulatory developments, management changes and decisions and other events, as well as general market factors, such as general stock market volatility and levels, interest rates and economic and political conditions.

Limited Return on the Securities – Your potential gain on a $10 principal amount of Securities will be limited to the Call Price applicable for an Observation Date (less the $10 initial investment), regardless of the appreciation in the Reference Shares, which may be significant. Similarly, because the determination of whether the Securities will be called will be based on the Closing Price of a Reference Share on a limited number of Observation Dates prior to the Maturity Date, and because, if the Securities are not called, the Final Share Price will be based on the Closing Price of a Reference Share on the last Observation Date (i.e., the Final Valuation Date), your return may be adversely affected by a sudden or temporary decrease in the Closing Price of a Reference Share on any or all of the Observation Dates. Conversely, you will not benefit from higher Closing Prices of a Reference Share at any time during the term of the Securities other than on the Observation Dates. As a result, you may receive a lower return on the Securities than you would receive if you were to invest directly in the Reference Shares.

No Assurances of a Flat or Bullish Environment - While the Securities are structured to provide positive returns in a flat or bullish environment, we cannot assure you of the economic environment during the term or at maturity of your Securities.

Lack of Liquidity – The Securities will not be listed on any securities exchange or quotation system. One of our affiliates may offer to repurchase the Securities in the secondary market but is not required to do so and may cease any such market-making activities at any time without notice. Because other dealers are not likely to make a secondary market for the Securities, the price at which you may be able to trade your Securities is likely to depend on the price, if any, at which one of our affiliates is willing to buy the Securities, which will exclude any fees or commissions you paid when you purchased the Securities.

No Interest – As a holder of the Securities, you will not receive interest payments.

Owning the Securities is Not the Same as Owning the Reference Shares — The return on your Securities may not reflect the return you would realize if you actually owned the Reference Shares. As a holder of the Securities, you will not have voting rights or rights to receive dividends or other distributions or other rights that holders of the Reference Shares would have. Furthermore, the Reference Shares may appreciate substantially during the term of your Securities and you will not participate in such appreciation.

Potentially Inconsistent Research, Opinions or Recommendations by HSBC – HSBC, UBS Financial Services Inc. or their affiliates, may publish research, express opinions or provide recommendations that are inconsistent with investing in or holding any offering of the Securities and which may be revised at any time. Any such research, opinions or recommendations could affect the value of the Reference Shares and therefore, the market value of the Securities.

Potential HSBC Impact on Price – Trading or transactions by HSBC USA Inc. or any of its affiliates in the Reference Shares, or in futures, options, exchange-traded funds or other derivative products on the Reference Shares, may adversely affect the market value of the Reference Shares and, therefore, the market value of the Securities.

Potential Conflict of Interest – HSBC and its affiliates may engage in business with the issuer of the Reference Shares, which may present a conflict between the obligations of HSBC and you, as a holder of the Securities. The Calculation Agent, which may be HSBC or any of its affiliates will determine the payment at maturity or on a Call Settlement Date based on observed prices of a Reference Share in the market. The Calculation Agent can postpone the determination of the Closing Price of a Reference Share on an Observation Date and the corresponding Call Settlement Date if a Market Disruption Event exists on such Observation Date. Furthermore, the Calculation Agent can postpone the determination of the Final Share Price and the Maturity Date if a Market Disruption Event occurs and is continuing on the Final Valuation Date.

Price Prior to Maturity — The market price of the Securities will be influenced by many unpredictable and interrelated factors, including the price of the Reference Shares; the volatility of the Reference Shares; the dividend rate paid on the Reference Shares; the time remaining to the maturity of the Securities; interest rates in the markets; geopolitical conditions and economic, financial, political and regulatory or judicial events; and the creditworthiness of HSBC.

There is Limited Anti-dilution Protection — The Calculation Agent will adjust the Closing Price, which will affect the Return on Call Date or the Reference Share Return and, consequently, the payment at maturity, for certain events affecting the Reference Shares, such as stock splits and corporate actions. The Calculation Agent is not required to make an adjustment for every corporate action which affects the Reference Shares. If an event occurs that does not require the Calculation Agent to adjust the amount of a Reference Share, the market price of the notes may be materially and adversely affected. See “Anti-dilution and Reorganization Adjustments” below for additional information.

The Securities are Not Insured by any Governmental Agency of The United States or any Other Jurisdiction – The Securities are not deposit liabilities or other obligations of a bank and are not insured by the Federal Deposit Insurance Corporation or any other governmental agency or program of the United States or any other jurisdiction. An investment in the Securities is subject to the credit risk of the Issuer, and in the event that the Issuer is unable to pay its obligations as they become due, you may not receive the full payment at maturity of the Securities.

In Some Circumstances, the Payment You Receive on the Securities May be Based on the Common Stock of Another Company and Not a Reference Share — Following certain corporate events relating to the respective issuer of the Reference Shares where such issuer is not the surviving entity, the amount of cash you receive at maturity may be based on the common stock of a successor to the respective Reference Share issuer or any cash or any other assets distributed to holders of the Reference Shares in such corporate event. The occurrence of these corporate events and the consequent adjustments may materially and adversely affect the value of the Securities. See “Merger Event and Tender Offer” and “Anti-dilution and Reorganization Adjustments” below for additional information. Regardless of the occurrence of one or more dilution or reorganization events, you should note that at maturity you will receive an amount in cash equal to your Principal Amount unless the Final Share Price of a Reference Share is below the Trigger Price (as such Trigger Price may be adjusted by the Calculation Agent upon occurrence of one or more such events).

	¨	Uncertain Tax Treatment – There is no direct legal authority as to the proper tax treatment of the Securities, and therefore significant aspects of the tax treatment of the Securities are uncertain as to both the timing and character of any inclusion in income in respect of the Securities. Under one reasonable approach, the Securities should be treated as pre-paid forward or other executory contracts with respect to a Reference Share. HSBC intends to treat the Securities consistent with this approach and pursuant to the terms of the Securities, you agree to treat the Securities under this approach for all U.S. federal income tax purposes. See “Certain U.S. Federal Income Tax Considerations — Certain Equity-Linked Notes — Certain Notes Treated as Forward Contracts or Executory Contracts” in the prospectus supplement for certain U.S. federal income tax considerations applicable to securities that are treated as pre-paid cash-settled forward or other executory contracts.

		In Notice 2008-2, the Internal Revenue Service (“IRS”) and the Treasury Department requested comments as to whether the purchaser of an exchange traded note or prepaid forward contract (which may include the Securities) should be required to accrue income during its term under a mark-to-market, accrual or other methodology, whether income and gain on such a note or contract should be ordinary or capital, and whether foreign holders should be subject to withholding tax on any deemed income accrual. Accordingly, it is possible that regulations or other guidance could provide that a U.S. holder of a Security is required to accrue income in respect of the Securities prior to the receipt of payments with respect to the Securities or their earlier sale. Moreover, it is possible that any such regulations or other guidance could treat all income and gain of a U.S. holder in respect of the Securities as ordinary income (including gain on a sale). Finally, it is possible that a non-U.S. holder (as defined in the prospectus supplement) of the Securities could be subject to U.S. withholding tax in respect of the Securities. It is unclear whether any regulations or other guidance would apply to the Securities (possibly on a retroactive basis). Prospective investors are urged to consult with their tax advisors regarding Notice 2008-2 and the possible effect to them of the issuance of regulations or other guidance that affects the U.S. federal income tax treatment of the Securities.

		For a more complete discussion of the U.S. federal income tax consequences of your investment in a security, please see the discussion under “Certain U.S. Federal Income Tax Considerations” in the prospectus supplement.

Hypothetical Scenario Analysis and Examples at Maturity

The below scenario analysis and examples are hypothetical and provided for illustrative purposes only. They do not purport to be representative of every possible scenario concerning increases or decreases in the price of a Reference Share relative to its Initial Share Price. We cannot predict the Final Share Price of a Reference Share on the Final Valuation Date or the Closing Price of a Reference Share on any scheduled trading day during the Observation Period, including the Observation Dates. You should not take the scenario analysis and these examples as an indication or assurance of the expected performance of the Reference Shares. The numbers appearing in the examples below have been rounded for ease of analysis. The following scenario analysis and examples illustrate the payment at maturity per $10.00 on a hypothetical offering of the Securities, based on the following assumptions (actual Initial Share Price, Trigger Price, Returns on Call Dates and Call Prices for the Securities were determined on the Trade Date, as described on the first page of this pricing supplement):

Investment term:	12 months (unless earlier called)

Hypothetical Initial Share Price:	$100.00

Hypothetical Trigger Price:	$70.00 (70% of the Initial Share Price)

Hypothetical Returns on Call Dates and Call Prices*:

Observation Dates	Return on Call Date*	Call Price*
May 24, 2010	1.59%	$10.16
June 24, 2010	3.18%	$10.32
July 26, 2010	4.77%	$10.48
August 25, 2010	6.36%	$10.64
September 24, 2010	7.95%	$10.80
October 25, 2010	9.54%	$10.95
November 23, 2010	11.13%	$11.11
December 27, 2010	12.72%	$11.27
January 25, 2011	14.31%	$11.43
February 22, 2011	15.90%	$11.59
March 25, 2011	17.49%	$11.75
Final Valuation Date (April 26, 2011)	19.08%	$11.91

* based on the Call Return Rate of 19.08% per annum.

Example 1—The Reference Share closes at $120.00 on the first Observation Date – the Securities are called.

Because the Closing Price of the Reference Share on the first Observation Date (May 24, 2010) is at or above the Initial Share Price, the Securities are automatically called at the applicable Call Price of $10.16 per security, representing an 1.59% return on the Securities. As long as the Reference Share closes at or above the Initial Share Price on any of the twelve Observation Dates, you will receive the applicable Call Price, regardless of whether or not the Reference Share had closed below the Trigger Price on any scheduled trading day during the Observation Period.

Example 2— The Reference Share closes at $110.00 on the Final Valuation Date – the Securities are called.

Because (i) the Closing Price of the Reference Share on the first eleven Observation Dates is below the Initial Share Price and (ii) the Closing Price of the Reference Share on the final Observation Date, (which is also the Final Valuation Date) is above the Initial Share Price, the Securities are automatically called at the applicable Call Price of $11.91 per security, representing a 19.08% return on the Securities.

Example 3— The Reference Share closes below the Initial Share Price on all twelve Observation Dates and on the Final Valuation Date it closes at $90.00 – the Securities are NOT called.

Because the Closing Price of the Reference Share on all twelve Observation Dates is each below the Initial Share Price, the Securities are not automatically called. Furthermore, because the Final Share Price is not below the Trigger Price on the Final Valuation Date, you will receive the principal amount at maturity of $10.00 per security (a return of zero percent).

Example 4— The Reference Share closes below the Initial Share Price on all twelve Observation Dates. In addition, the Reference Share closes at $60.00 on the Final Valuation Date – the Securities are NOT called.

Because the Closing Prices of the Reference Share on all twelve Observation Dates are each below the Initial Share Price, the Securities are not automatically called. Furthermore, because the Final Share Price of the Reference Share is below the Trigger Price on the Final Valuation Date, the contingent principal protection is lost and your principal is fully exposed to any decrease in the Final Share Price relative to the Initial Share Price on the Final Valuation Date. Therefore you will suffer a loss on the Securities of 40.00%. Expressed as a formula:

Reference Share Return = ($60.00 – $100.00) / $100.00 = -40.00%

payment at maturity = $10 × [100% + -40%)] = $6.00

In this example, you would lose some of your principal amount at maturity.

If the Final Share Price is below the Trigger Price on the Final Valuation Date, the contingent protection feature is lost and you are fully exposed to any loss resulting from the decrease in the price of the Reference Shares and you would lose some or all of your principal at maturity.

Information about Bank of America Corporation (“BAC”)

Included on the following pages is a brief description of the issuer of the Reference Shares. This information has been obtained from publicly available sources. Set forth below is a table that provides the quarterly high and low intraday prices for the Reference Shares. The information given below is for the four calendar quarters in each of 2005, 2006, 2007, 2008, and 2009 and the first calendar quarter of 2010. Partial data is provided for the second calendar quarter of 2010. HSBC obtained the intraday prices information set forth below from the Bloomberg Professional® service (“Bloomberg”) without independent verification. You should not take the historical prices of the Reference Shares as an indication of future performance.

BAC is registered under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Companies with securities registered under the Exchange Act are required to file financial and other information specified by the SEC periodically. Information filed by the issuer of the Reference Share with the SEC can be reviewed electronically through a web site maintained by the SEC. The address of the SEC’s web site is http://www.sec.gov. Information filed with the SEC by the issuer of the Reference Shares under the Exchange Act can be located by reference to its SEC file number provided below. In addition, information filed with the SEC can be inspected and copied at the Public Reference Section of the SEC, 100 F Street, N.E., Room 1580, Washington, D.C. 20549. Copies of this material can also be obtained from the Public Reference Section, at prescribed rates.

Bank of America Corporation

According to publicly available information, Bank of America Corporation (“BAC”) is a bank holding company and a financial holding company. Bank of America Corporation provides banking and non-banking financial services and products through six business segments: Deposits, Global Card Services, Home Loans & Insurance, Global Banking, Global Markets and Global Wealth & Investment Management. Information filed by BAC with the SEC under the Exchange Act can be located by reference to its SEC file number: 001-06523 or its CIK Code: 0000070858. The common stock of BAC is listed on the New York Stock Exchange under ticker symbol “BAC”.

Historical Information

The following table sets forth the quarterly high and low intraday prices for BAC’s common stock, based on daily intraday prices on the primary exchange for BAC, as reported by Bloomberg. BAC’s Closing Price on April 27, 2010 was $17.47. Past performance of the Reference Shares is not indicative of the future performance of the Reference Shares.

Quarter Begin	Quarter End	Quarterly High	Quarterly Low	Quarterly Close
1/3/2005	3/31/2005	$47.20	$43.43	$44.10
4/1/2005	6/30/2005	$47.42	$43.47	$45.61
7/1/2005	9/30/2005	$46.05	$41.14	$42.10
10/3/2005	12/30/2005	$47.25	$41.38	$46.15
1/3/2006	3/31/2006	$47.20	$42.98	$45.54
4/3/2006	6/30/2006	$50.50	$45.26	$48.10
7/3/2006	9/29/2006	$54.00	$47.59	$53.57
10/2/2006	12/29/2006	$55.08	$51.32	$53.39
1/3/2007	3/30/2007	$54.21	$48.36	$51.02
4/2/2007	6/29/2007	$52.20	$48.55	$48.89
7/2/2007	9/28/2007	$52.77	$46.52	$50.27
10/1/2007	12/31/2007	$52.95	$40.61	$41.26
1/2/2008	3/31/2008	$45.08	$33.25	$37.91
4/1/2008	6/30/2008	$41.37	$23.65	$23.87
7/1/2008	9/30/2008	$38.85	$18.44	$35.00
10/1/2008	12/31/2008	$38.50	$10.01	$14.08
1/2/2009	3/31/2009	$14.81	$2.53	$6.82
4/1/2009	6/30/2009	$15.06	$6.45	$13.20
7/1/2009	9/30/2009	$18.25	$11.27	$16.92
10/1/2009	12/31/2009	$18.64	$14.12	$15.06
1/3/2010	3/31/2010	$18.35	$14.25	$17.85
4/1/2010*	4/27/2010*	$19.82	$17.41	$17.47

* As of the date of this pricing supplement available information for the second calendar quarter of 2010 includes data for the period from April 1, 2010 through April 27, 2010. Accordingly, the “Quarterly High,” “Quarterly Low” and “Quarterly Close” data indicated are for this shortened period only and do not reflect complete data for the second calendar quarter of 2010.