Issuer:

HSBC Holdings plc

Expected Ratings on the Capital Securities:

A1/A/AA-

Offered Securities:

8.125% Perpetual Subordinated Capital Securities Exchangeable at the Issuer’s Option into Non-Cumulative Dollar Preference Shares

Pricing Date:

April 2, 2008

Settlement Date:

April 9, 2008 (T+ 5)

Maturity Date:

Perpetual

Form of Offering:

SEC Registered

Principal Amount:

$2,000,000,000

Number of Capital Securities:

80,000,000

Over-allotment Option:

A maximum of $200,000,000 additional principal amount (8,000,000 additional Capital Securities) at the public offer price within 30 days of the Pricing Date

Offer Price:

$25 per Capital Security

Interest Rate:

8.125% per annum

Coupon Payment Dates:

Quarterly in arrears on each January 15, April 15, July 15 and October 15, commencing July 15, 2008

Day Count:

30 / 360

Net Proceeds to Issuer:

$1,939,875,000 (assumes underwriting commission of $0.7875 per capital security on sales to retail and $0.500 per capital security on sales to institutions)

Deferred Coupon Payment:

The Issuer may elect to defer coupon payments on the Capital Securities at its discretion and may be required to defer coupon payments on the Capital Securities in accordance with the Solvency Condition. Subject to certain exceptions, deferred coupon payments will remain outstanding until settled in accordance with the ACSM.

Optional and Special Event Redemption:

The Issuer may redeem the Capital Securities, in whole or in part, at its option, at any time on or after April 15, 2013 or in whole (but not in part) at its option at any time upon the occurrence of a Tax Event or a Regulatory Event.

Exchange into Preference Shares:

On any coupon payment date, the Issuer may exchange the Capital Securities in whole (but not in part) for perpetual non-cumulative dollar preference shares.

Ranking:

The Capital Securities will constitute unsecured, subordinated obligations.

In a winding up of the Issuer, the claims of Capital Securities holders will rank (a) junior to depositors and all other creditors other than claims which are by their terms or expressed to be subordinated to or pari passu with the Capital Securities and (b) pari passu with the most senior class of non-cumulative preference shares of the Issuer.

Listing:

Application will be made to list the Capital Securities on the New York Stock Exchange.

CUSIP:

404280 703

ISIN:

US4042807036

Joint Bookrunners:

HSBC Securities (USA) Inc.

Citigroup Global Markets Inc.

Merrill Lynch, Pierce Fenner & Smith Incorporated

Morgan Stanley & Co. Incorporated

UBS Securities LLC

Senior Co-Manager:

Wachovia Capital Markets, LLC

Co-Manager:

RBC Capital Markets Corporation

Junior Co-Managers:

ABN AMRO Incorporated

Banc of America Securities LLC

Credit Suisse Securities (USA) Inc.

Deutsche Bank Securities Inc.

Wells Fargo Investments, LLC