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ISSUE OF CALL WARRANTS ON HSI - Hang Seng Index

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ISSUE OF CALL WARRANTS ON HSI - Hang Seng Index Powered By Docstoc
					25 March, 2011




                 THE HONGKONG AND SHANGHAI BANKING CORPORATION LIMITED


                           ISSUE OF CALL WARRANTS ON
                                HSI - Hang Seng Index
                                      Final Terms and Conditions

 Issuer:                       The Hongkong and Shanghai Banking Corporation Limited (Moody’s:
                               Aa1, Standard & Poor: AA)
 Stock Code:                   29928
 Issue Size:                   300,000,000 Warrants
 Launch Date:                  25 March, 2011
 Issue Date:                   31 March, 2011
 Payment Date:                 31 March, 2011
 Listing Date:                 1 April, 2011
 Expiry Date:                  28 October, 2011
 Type:                         European Call Warrants
 Underlying Index:             HSI - Hang Seng Index
 Settlement Method:            Cash Settlement
 Reference Level:              22915.28
 Strike Level:                 22800.00
 Issue Price:                  HKD 0.25
 Premium:                      9.32 %
 Gearing:                      10.18
 Effective Gearing:            5.50
 Implied Volatility:           33.0 %
 Currency:                     Hong Kong Dollar (HKD)
 Board Lot:                    10,000
 Divisor:                      9000
 Exercise Amount:              1 Board Lot or integral multiples thereof
 Form:                         The Warrants will be issued in global registered form
 Listing:                      Application will be made for the listing of, and permission to deal in, the
                               Warrants on The Stock Exchange of Hong Kong Limited. The Warrants
                               are conditional upon listing approval being obtained.

 Cash Settlement Amount:       In respect of every 10,000 Warrant(s):

                               [(Closing Level – Strike Level) x (Board Lot/Divisor) x HKD 1.00]

                               The Warrants will be automatically exercised on the Expiry Date if the
                               Cash Settlement Amount is greater than zero.
 Closing Level:                Final settlement price for settling the HSI Oct 2011 Futures Contracts
                               determined pursuant to Regulation 012 of the Regulations for Trading
                               Stock Index Futures and the Contract Specifications for HSI Futures

HK:5035389.1
                                                     contracts (as amended from time to time) of the Hong Kong Futures
                                                     Exchange.

 Liquidity Provider:                                 HSBC Securities Brokers (Asia) Limited (LP Broker ID Number : 9609)
                                                      Address:              Levels 17 and 18, HSBC Main Building, 1
                                                      Queen’s Road Central, Hong Kong
                                                      Contact Persons:      Simon Shek, Keith Chan, Victor Chan, Mark
                                                      Ng and Natalie Khor
                                                      Telephone Number: (852) 2822 1849

 Registrar and Warrant Agent:                        Computershare Hong Kong Investor Services Limited
 Governing Law:                                      Hong Kong law
 Clearing and Settlement:                            Application will be made for the Warrants to be admitted for clearing
                                                     and settlement through Central Clearing and Settlement System
                                                     (CCASS)
 Certificate Despatch Date /                         31 March, 2011
 Settlement Instruction (SI) Input
 Date:
 Portfolio Movement Date:                            31 March, 2011
 Issuer’s Contact Details:                             Address:              Level 18, HSBC Main Building, 1 Queen’s
                                                       Road Central, Hong Kong
                                                       Telephone Number: (852) 2822 1849




Index Sponsor Disclaimer

The Hang Seng Index (the Index) is published and compiled by Hang Seng Indexes Company Limited pursuant to a licence from Hang Seng Data Services
Limited. The mark and name "Hang Seng Index" is proprietary to Hang Seng Data Services Limited. Hang Seng Indexes Company Limited and Hang Seng
Data Services Limited have agreed to the use of, and reference to, the Index by the The Hongkong And Shanghai Banking Corporation Limited in connection
with the Warrants (the Product), BUT NEITHER HANG SENG INDEXES COMPANY LIMITED NOR HANG SENG DATA SERVICES LIMITED
WARRANTS OR REPRESENTS OR GUARANTEES TO ANY BROKER OR HOLDER OF THE PRODUCT OR ANY OTHER PERSON (i) THE
ACCURACY OR COMPLETENESS OF THE INDEX AND ITS COMPUTATION OR ANY INFORMATION RELATED THERETO; OR (ii)
THE FITNESS OR SUITABILITY FOR ANY PURPOSE OF THE INDEX OR ANY COMPONENT OR DATA COMPRISED IN IT; OR (iii) THE
RESULTS WHICH MAY BE OBTAINED BY ANY PERSON FROM THE USE OF THE INDEX OR ANY COMPONENT OR DATA
COMPRISED IN IT FOR ANY PURPOSE, AND NO WARRANTY OR REPRESENTATION OR GUARANTEE OF ANY KIND WHATSOEVER
RELATING TO THE INDEX IS GIVEN OR MAY BE IMPLIED. The process and basis of computation and compilation of the Index and any of the
related formula or formulae, constituent stocks and factors may at any time be changed or altered by Hang Seng Indexes Company Limited without notice. TO
THE EXTENT PERMITTED BY APPLICABLE LAW, NO RESPONSIBILITY OR LIABILITY IS ACCEPTED BY HANG SENG INDEXES
COMPANY LIMITED OR HANG SENG DATA SERVICES LIMITED (i) IN RESPECT OF THE USE OF AND/OR REFERENCE TO THE
INDEX BY THE HONGKONG AND SHANGHAI BANKING CORPORATION LIMITED IN CONNECTION WITH THE PRODUCT; OR (ii)
FOR ANY INACCURACIES, OMISSIONS, MISTAKES OR ERRORS OF HANG SENG INDEXES COMPANY LIMITED IN THE
COMPUTATION OF THE INDEX; OR (iii) FOR ANY INACCURACIES, OMISSIONS, MISTAKES, ERRORS OR INCOMPLETENESS OF
ANY INFORMATION USED IN CONNECTION WITH THE COMPUTATION OF THE INDEX WHICH IS SUPPLIED BY ANY OTHER
PERSON; OR (iv) FOR ANY ECONOMIC OR OTHER LOSS WHICH MAY BE DIRECTLY OR INDIRECTLY SUSTAINED BY ANY
BROKER OR HOLDER OF THE PRODUCT OR ANY OTHER PERSON DEALING WITH THE PRODUCT AS A RESULT OF ANY OF THE
AFORESAID, AND NO CLAIMS, ACTIONS OR LEGAL PROCEEDINGS MAY BE BROUGHT AGAINST HANG SENG INDEXES COMPANY
LIMITED AND/OR HANG SENG DATA SERVICES LIMITED in connection with the Product in any manner whatsoever by any broker, holder or other
person dealing with the Product. Any broker, holder or other person dealing with the Product does so therefore in full knowledge of this disclaimer and can
place no reliance whatsoever on Hang Seng Indexes Company Limited and Hang Seng Data Services Limited. For the avoidance of doubt, this disclaimer
does not create any contractual or quasi-contractual relationship between any broker, holder or other person and Hang Seng Indexes Company Limited and/or
Hang Seng Data Services Limited and must not be construed to have created such relationship.


Important Considerations

This term sheet contains a summary of the final terms of the Warrants only. The full terms and conditions of the warrants can be found in the Base Listing
Document (which also contains financial and other information relating to the Issuer) and the Supplemental Listing Document to be produced in connection
with the Warrants (which contains details of the Warrants). Copies of the Base Listing Document (which will be available from the date of this term sheet to
the Expiry Date) and the Supplemental Listing Document (which will be available from the Issue Date to the Expiry Date), and any addenda and successor
document to the Base Listing Document and Supplemental Listing Document, may be inspected during usual business hours on any weekday (Saturdays,
Sundays and public holidays excepted) at the offices of the Registrar, currently at Rooms 1712-1716, 17th Floor, Hopewell Centre, 183 Queen’s Road East,
Hong Kong. Copies of these documents may also be obtained during usual business hours on any weekday (Saturdays, Sundays and public holidays excepted)
from the office of the Issuer at Level 15, HSBC Main Building, 1 Queen's Road Central, Hong Kong.

The price of the Warrants may fall in value as rapidly as it may rise and you may sustain a total loss of your investment. You should therefore ensure that you
understand the nature of the Warrants and carefully study the risk factors set out in the Base Listing Document and the Supplemental Listing Document (when
available) and, where necessary, seek professional advice before you invest in the Warrants. Investors should note that The Hongkong and Shanghai Banking
Corporation Limited acting through its appointed liquidity provider may be the only market participant in the Warrants.



HK:5035389.1
The issuance of and details contained in this term sheet does not constitute an offer or solicitation for, or advice that you should enter into, the purchase or sale
of any Warrants. This is intended as an outline only of the Warrants described in this term sheet and does not purport to list or summarise all of the terms and
conditions of the Warrants, nor to identify or define all or any of the risks that would be associated with the purchase or sale of such Warrants. Neither The
Hongkong and Shanghai Banking Corporation Limited (HSBC) nor any of its affiliates are advising you in respect hereof; accordingly prior to making an
investment decision, you should conduct such investigation and analysis regarding the Warrants described in this term sheet as you deem appropriate and to
the extent you deem necessary obtain independent advice from competent legal, financial, tax, accounting and other professionals to enable you to understand
and recognise fully the legal, financial, tax and other risks arising in respect of such product(s) and the purchase, holding and sale thereof. Please note that the
prices or levels contained in this term sheet are final as at the date of this term sheet. No liability is accepted whatsoever for any direct, indirect or
consequential loss arising from the use of this term sheet, the distribution of which may be restricted by law in certain jurisdictions. HSBC, its affiliates
and/or individuals associated therewith may have (or may liquidate) from time to time positions in the Warrants and/or the Underlying Index (including
derivatives thereof) referred to in this term sheet, or in any other asset, which may directly or indirectly affect the return to you under the Warrants.

Should you intend to sell or otherwise transfer or supply (directly or indirectly) the Warrants (or any interest therein) described herein to any third party, you
(rather than HSBC or any of its affiliates) will be responsible for complying with all applicable laws, regulations and rules in respect of any such sale, transfer
or supply (including without limitation as to the suitability of such Warrants for such third party) and the provision of all appropriate risk warnings and
disclosures. In addition, you accept that in no circumstances shall any such third party be treated as a customer of HSBC (or any of its affiliates) in respect of
such sale, transfer or supply.

The Issuer is not the ultimate holding company of the group to which the Issuer belongs and with which the Issuer's name is identified. The ultimate holding
company of the group to which the Issuer belongs is HSBC Holdings plc

The information in this term sheet is derived from sources believed to be reliable but which have not been independently verified. HSBC makes no guarantee
of its accuracy and completeness and is not responsible for errors of transmission of factual or analytical data, nor is it liable for any direct or consequential
damages arising out of any person's reliance upon this information.

For Exchange use only: As of the launch date, no Hedging Participant has been appointed.




HK:5035389.1

				
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