By Kiku Steinfeld
Chicago, April 1 – HSBC USA Inc. priced $5 million of contingent income callable securities due March 18, 2021 linked to the worst performing of the common stocks of Exxon Mobil Corp. and Chevron Corp., according to a 424B2 filing with the Securities and Exchange Commission.
Each quarter, the notes pay a contingent coupon at an annual rate of 29% if each stock closes at or above its downside threshold level, 60% of its initial stock level, on any quarterly determination date.
The notes are callable at par of $10 plus any coupon due on any quarterly determination date.
If each stock finishes at or above its 60% downside threshold level, the payout at maturity will be par plus the final contingent coupon. If the final level of any stock is less than its downside threshold level, investors will be fully exposed to the decline of the least-performing stock.
HSBC Securities (USA) Inc. is the agent. Distribution is through Morgan Stanley Wealth Management.
| Issuer: | HSBC USA Inc.
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| Issue: | Contingent income callable securities
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| Underlying stocks: | Chevron Corp. (Symbol: CVX), Exxon Mobil Corp. (Symbol: XOM)
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| Amount: | $5,000,000
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| Maturity: | March 18, 2021
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| Coupon: | 29% per year, payable quarterly if each stock closes at or above downside threshold on any quarterly determination date
|
| Price: | Par of $10
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| Payout at maturity: | If each stock finishes at or above downside threshold, par plus final contingent coupon; if final level of any stock is less than downside threshold, full exposure to decline of lowest-performing stock
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| Call option: | At par plus any coupon on any quarterly determination date
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| Initial levels: | $83.42 for Chevron, $38.12 for Exxon
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| Downside thresholds: | $50.052 for Chevron, $22.872 for Exxon; 60% of initial levels
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| Pricing date: | March 13
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| Settlement date: | March 18
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| Agent: | HSBC Securities (USA) Inc.
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| Distribution: | Morgan Stanley Wealth Management
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| Fees: | 1.75%
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| Cusip: | 40438J833
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