Published on 10/30/2007 in the Prospect News Structured Products Daily.
New Issue: HSBC prices $8.625 million 21% down & in worst of reverse convertibles tied to 10 stocks
By E. Janene Geiss
Philadelphia, Oct. 29 - HSBC USA Inc. priced an $8.625 million issue of 21% down & in worst of reverse convertible notes due Oct. 31, 2008 linked to a basket of 10 stocks, according to a 424B2 filing with the Securities and Exchange Commission.
The underlying securities are the common stocks of Altria Group, Inc., Citigroup Inc., AT&T Inc., Pfizer Inc., JPMorgan Chase & Co., Merck & Co., Inc., General Electric Co., Verizon Communications Inc., General Motors Corp. and E.I. DuPont De Nemours and Co.
Interest is payable monthly.
The payout will be based on the performance of the basket of reference assets during the life of the notes. At maturity, investors will receive par unless the market price of any stock falls below the protection price - 60% of the initial price - during the life of the notes and finishes below the initial price, in which case the payout will be a number of shares of the worst-performing stock equal to $1,000 divided by its initial price.
HSBC Securities (USA) Inc. is the agent.
| Issuer: | HSBC USA Inc.
|
| Issue: | Down & in worst of reverse convertible notes
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| Amount: | $8.625 million
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| Underlying shares: | Altria Group, Inc. (MO), Citigroup Inc. (C), AT&T Inc. (T), Pfizer Inc. (PFE), JPMorgan Chase & Co. (JPM), Merck & Co., Inc. (MRK), General Electric Co. (GE), Verizon Communications Inc. (VZ), General Motors Corp. (GM) and E.I. DuPont De Nemours and Co. (DD)
|
| Maturity: | Oct. 31, 2008
|
| Coupon: | 21%, payable monthly
|
| Price: | Par
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| Payout at maturity: | Par unless any stock falls below its protection price during the life of the notes and finishes below its initial price; in that case, a number of the worst-performing shares equal to $1,000 divided by its initial price
|
| Initial prices: | $72.97 for Altria, $42.63 for Citigroup, $41.46 for AT&T, $24.31 for Pfizer, $47.32 for JPMorgan, $57.58 for Merck, $40.38 for General Electric, $45.60 for Verizon, $37.77 for General Motors and $48.37 for E.I. DuPont
|
| Protection prices: | 60% of initial prices; $43.78 for Altria, $25.58 for Citigroup, $24.88 for AT&T, $14.59 for Pfizer, $28.39 for JPMorgan, $34.55 for Merck, $24.23 for General Electric, $27.36 for Verizon, $22.66 for General Motors and $29.02 for E.I. DuPont
|
| Pricing date: | Oct. 26
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| Settlement date: | Oct. 31
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| Agent: | HSBC Securities (USA) Inc.
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| Fees: | 3%
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