Published on 6/28/2013 in the Prospect News Structured Products Daily.
New Issue: HSBC prices $6.89 million three-year Stars linked to index basket
By Toni Weeks
San Luis Obispo, Calif., June 28 - HSBC USA Inc. priced $6.89 million of 0% Strategic Accelerated Redemption Securities due June 24, 2016 linked to a global equity basket, according to a 424B2 filing with the Securities and Exchange Commission.
The basket components are the Dow Jones industrial average with a 50% weight, the Euro Stoxx 50 index with a 35% weight and the Nikkei Stock Average index with a 15% weight.
If the basket closes at or above its initial level on one of three annual observation dates, the notes will be called at par of $10 plus an annualized call premium of 8%. The observation dates are June 26, 2014, June 19, 2015 and June 17, 2016.
If the notes are not called and the final basket value is at least 94.25% of the initial value, the payout at maturity will be par. Investors will be exposed to losses beyond the 5.75% buffer.
BofA Merrill Lynch is the agent.
| Issuer: | HSBC USA Inc.
|
| Issue: | Strategic Accelerated Redemption Securities
|
| Underlying indexes: | Dow Jones industrial average (50% weight), Euro Stoxx 50 index (35% weight) and Nikkei Stock Average index (15% weight)
|
| Amount: | $6,887,000
|
| Maturity: | June 24, 2016
|
| Coupon: | 0%
|
| Price: | Par of $10
|
| Payout at maturity: | Par if final basket level is at least 94.25% of initial level; otherwise, exposure to losses beyond 5.75% buffer
|
| Call: | At par plus 8% per year if basket closes at or above its initial level on any of three observation dates (June 26, 2014, June 19, 2015 and June 17, 2016)
|
| Initial basket level: | 100
|
| Initial component levels: | 14,760.31 for Dow, 2,543.37 for Euro Stoxx and 12,969.34 for Nikkei
|
| Buffer level: | 94.25% of initial level
|
| Pricing date: | June 25
|
| Settlement date: | July 2
|
| Underwriter: | BofA Merrill Lynch
|
| Fees: | 2%
|
| Cusip: | 40433X555
|
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