Published on 11/7/2023 in the Prospect News Investment Grade Daily.
New Issue: HSBC Holdings prices $2 billion of 7.399% fixed-rate/floating-rate subordinated notes
By Mary-Katherine Stinson and Cristal Cody
Lexington, Ky., Nov. 7 – HSBC Holdings plc priced a $2 billion offering of fixed-rate/floating-rate subordinated notes at par (Baa1/BBB/A-) on Monday, according to an FWP filed with the Securities and Exchange Commission and details from a market source.
The notes will initially bear interest at 7.399% until Nov. 13, 2033 when the rate transitions to SOFR plus 302 basis points.
The notes priced at a spread of Treasuries plus 275 bps versus price talk in the 300 bps area.
The notes are callable at par on Nov. 13, 2033, or at par due to a tax event or a capital disqualification event.
HSBC Securities (USA) Inc. is the sole bookrunning manager.
Proceeds will be used for general corporate purposes and to maintain or strengthen the company’s capital base.
The issuer is a banking and financial services group based in London.
| Issuer: | HSBC Holdings plc
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| Amount: | $2 billion
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| Issue: | Fixed-rate/floating-rate subordinated notes
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| Maturity: | Nov. 13, 2034
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| Bookrunner: | HSBC Securities (USA) Inc.
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| Co-managers: | ABN Amro Securities (USA) LLC, Academy Securities, Inc., Banco de Sabadell, SA, Bancroft Capital, LLC, Barclays, Blaylock Van LLC, BofA Securities, Inc., CaixaBank, SA, Citigroup Global Markets Inc., Commerz Markets LLC, Credit Agricole Securities (USA) Inc., Danske Markets Inc., Drexel Hamilton, LLC, Guzman & Co., ING Financial Markets LLC, Intesa Sanpaolo IMI Securities Corp., J.P. Morgan Securities LLC, Lloyds Securities Inc., Loop Capital Markets LLC, MFR Securities, Inc., Mischler Financial Group, Inc., Morgan Stanley & Co. LLC, Penserra Securities LLC, R. Seelaus & Co., LLC, RB International Markets (USA) LLC, RBC Capital Markets, LLC, Samuel A. Ramirez & Co., Inc., Siebert Williams Shank & Co, Inc., Societe Generale, TD Securities (USA) LLC, Governor and Co. of the Bank of Ireland and U.S. Bancorp Investments, Inc.
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| Trustee: | Bank of New York Mellon, London Branch
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| Counsel to issuer: | Cleary Gottlieb Steen & Hamilton LLP
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| Counsel to underwriters: | Linklaters LLP
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| Coupon: | 7.399% before Nov. 13, 2033; then SOFR plus 302 bps
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| Price: | Par
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| Yield: | 7.399%
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| Spread: | Treasuries plus 275 bps
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| Call features: | At par on Nov. 13, 2033
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| Pricing date: | Nov. 6
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| Settlement date: | Nov. 13
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| Ratings: | Moody’s: Baa1
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| S&P: BBB
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| Fitch: A-
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| Distribution: | SEC registered
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| Price talk: | Treasuries plus 300 bps area
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| Cusip: | 404280EC9
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