Published on 10/11/2021 in the Prospect News Structured Products Daily.
New Issue: HSBC sells $2.75 million contingent income barrier autocalls with memory on three stocks
By William Gullotti
Buffalo, N.Y., Oct. 12 – HSBC USA Inc. priced $2.75 million of autocallable contingent income barrier notes with memory coupon due Oct. 7, 2022 linked to the least performing of the common stocks of Wells Fargo & Co., Citigroup Inc. and Charles Schwab Corp., according to a 424B2 filing with the Securities and Exchange Commission.
The notes will pay a contingent quarterly coupon at an annualized rate of 12.46% if each stock closes at or above its coupon trigger level, 70% of its initial level, on the observation date for that period. Previously unpaid coupons, if any, will be automatically included whenever coupon payments are made.
The notes will be called at par plus the coupon, and any previously unpaid coupons, if each stock closes at or above its initial level on any quarterly call observation date.
If the notes are not called and each stock finishes at or above its 70% barrier value, the payout at maturity will be par plus the final coupon plus any previously unpaid coupons. Otherwise, investors will be fully exposed to the decline of the least-performing stock from its initial level.
HSBC Securities (USA) Inc. is the agent.
| Issuer: | HSBC USA Inc.
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| Issue: | Autocallable contingent income barrier notes with memory coupon
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| Underlying stocks: | Wells Fargo & Co., Citigroup Inc., Charles Schwab Corp.
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| Amount: | $2,750,000
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| Maturity: | Oct. 7, 2022
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| Coupon: | 12.46% per year, payable quarterly if each stock closes at or above coupon trigger on observation date for that period; coupon payment events will automatically include any previously unpaid coupons
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| Price: | Par
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| Payout at maturity: | If each stock finishes at or above barrier level, par plus the final coupon and any previously unpaid coupons; otherwise, full exposure to decline of least-performing stock from its initial level
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| Call: | At par plus coupon if each stock closes at or above initial level on any quarterly call observation date
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| Initial levels: | $47.02 for Wells Fargo, $71.29 for Citi, $73.23 for Schwab
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| Coupon triggers: | $32.914 for Wells Fargo, $49.903 for Citi, $51.261 for Schwab; 70% of initial levels
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| Barrier levels: | $32.914 for Wells Fargo, $49.903 for Citi, $51.261 for Schwab; 70% of initial levels
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| Pricing date: | Oct. 4
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| Settlement date: | Oct. 7
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| Agent: | HSBC Securities (USA) Inc.
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| Fees: | 1%
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| Cusip: | 40439JPU3
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