Published on 8/30/2021 in the Prospect News Structured Products Daily.
New Issue: HSBC sells $4.23 million contingent income callables on Nasdaq, Russell, EAFE ETF
By William Gullotti
Buffalo, N.Y., Aug. 30 – HSBC USA Inc. priced $4.23 million of contingent income callable securities due Aug. 29, 2024 linked to the worst performing of the iShares MSCI EAFE ETF, the Russell 2000 index and the Nasdaq-100 index, according to a 424B2 filing with the Securities and Exchange Commission.
The notes pay a contingent quarterly coupon at an annual rate of 8.8% if each index closes at or above its coupon barrier level, 75% of its initial index level, on the relevant observation date.
HSBC may call the notes at par plus any coupon due on any quarterly determination date.
If each underlier finishes at or above its respective coupon barrier, the payout at maturity will be par plus the final coupon.
If the worst performer finishes below the coupon barrier but at or above its 60% downside threshold, the payout at maturity will be par. Otherwise, investors will be fully exposed to the decline of the worst performer from its initial level.
HSBC Securities (USA) Inc. is the agent. Distribution is through Morgan Stanley Wealth Management.
| Issuer: | HSBC USA Inc.
|
| Issue: | Contingent income callable securities
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| Underlying assets: | iShares MSCI EAFE ETF, Russell 2000 index, Nasdaq-100 index
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| Amount: | $4,225,000
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| Maturity: | Aug. 29, 2024
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| Coupon: | 8.8% per year, payable quarterly if each underlier closes at or above coupon barrier on the relevant observation date
|
| Price: | Par
|
| Payout at maturity: | If each underlier finishes at or above coupon barrier, par plus final contingent coupon; if worst performer falls below coupon barrier but finishes at or above downside threshold, par; otherwise, full exposure to decline of the worst performer from its initial level
|
| Call option: | At par plus any coupon due on any quarterly determination date
|
| Initial levels: | $80.39 for ETF, 15,368.92 for Nasdaq, 2,239.269 for Russell
|
| Coupon barriers: | $60.2925 for ETF, 11,526.69 for Nasdaq, 1,679.452 for Russell; 75% of initial levels
|
| Downside threshold: | $48.234 for ETF, 9,221.352 for Nasdaq, 1,343.561 for Russell; 60% of initial levels
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| Strike date: | Aug. 25
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| Pricing date: | Aug. 26
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| Settlement date: | Aug. 30
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| Agent: | HSBC Securities (USA) Inc.
|
| Distribution: | Morgan Stanley Wealth Management
|
| Fees: | None
|
| Cusip: | 40439JKL8
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