A preliminary prospectus for HBanc Capital Securities Trust has been filed with Canadian securities regulators in all provinces and territories for an initial public offering of Class A and Class U units, Connor, Clark & Lunn Capital Markets Inc. announced Wednesday.

CC&L will act as manager of the fund. CC&L also acts as the manager of Canadian Banc Capital Securities Trust and North American Financials Capital Securities Trust, and is part of the Connor, Clark & Lunn Financial Group, which is responsible for the investment of approximately $35 billion in financial assets as at June 30, 2010.

The fund was established to provide investors with high levels of stable, tax-advantaged distributions through exposure to capital securities issued by HSBC Holdings plc, a strongly capitalized global bank.

The fund’s investment objectives are to provide unitholders with monthly, tax-advantaged distributions consisting primarily of returns of capital, currently representing a yield on the unit issue price of 7.0% per year, and provide exposure to the capital securities.

The fund will not have a fixed distribution, but intends to make monthly distributions based on the actual and expected distributions on the capital securities less the fund’s estimated expenses, CC&L says.

The capital securities are denominated in U.S. dollars. The CC&L intends to hedge substantially all of the value of the capital securities back to the Canadian dollar in respect of Class A units. CC&L will not hedge its currency exposure in respect of Class U units, which are designed for investors wishing to make their investment in U.S. dollars.

The units are being offered for sale by a syndicate of agents led by BMO Capital Markets and HSBC Securities (Canada) Inc., and includes CIBC, RBC Capital Markets, National Bank Financial Inc., Scotia Capital Inc., GMP Securities L.P., Canaccord Genuity Corp., Dundee Securities Corporation, Macquarie Capital Markets Canada Ltd., Raymond James Ltd., Desjardins Securities Inc., Mackie Research Capital Corporation and Wellington West Capital Markets Inc.

Prospective purchasers may purchase units either by cash payment or an exchange of freely tradeable securities of any exchange eligible issuer listed in the fund’s prospectus.

IE