Published on 6/29/2022 in the Prospect News Structured Products Daily.
New Issue: HSBC sells $3.6 million contingent income barrier autocalls on three banking stocks
By William Gullotti
Buffalo, N.Y., June 29 – HSBC USA Inc. priced $3.6 million of autocallable contingent income barrier notes due June 30, 2025 linked to the least performing of the stocks of JPMorgan Chase & Co., Citigroup Inc. and Goldman Sachs Group, Inc., according to a 424B2 filing with the Securities and Exchange Commission.
The notes will pay a contingent quarterly coupon at an annualized rate of 13% if each stock closes at or above its coupon trigger level, 60% of its initial level, on the observation date for that period.
The notes will be called at par plus the coupon if each stock closes at or above its initial level on any quarterly call observation date after six months.
If the notes are not called and each stock finishes at or above its 60% barrier value, the payout at maturity will be par plus the final coupon. Otherwise, investors receive a number of shares of the worst performer equal to $1,000 divided by that stock’s initial level.
HSBC Securities (USA) Inc. is the agent.
| Issuer: | HSBC USA Inc.
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| Issue: | Autocallable contingent income barrier notes
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| Underlying stocks: | JPMorgan Chase & Co., Citigroup Inc., Goldman Sachs Group, Inc.
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| Amount: | $3.6 million
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| Maturity: | June 30, 2025
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| Coupon: | 13% per year, payable quarterly if each stock closes at or above coupon trigger on observation date for that period
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| Price: | Par
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| Payout at maturity: | If each stock finishes at or above barrier level, par plus final coupon; otherwise, receive a number of shares of the worst performer equal to $1,000 divided by that stock’s 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 after six months
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| Initial levels: | $113.92 for JPMorgan, $46.35 for Citi, $286.17 for Goldman Sachs
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| Coupon triggers: | $68.352 for JPMorgan, $27.81 for Citi, $171.702 for Goldman Sachs; 60% of initial levels
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| Barrier levels: | $68.352 for JPMorgan, $27.81 for Citi, $171.702 for Goldman Sachs; 60% of initial levels
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| Strike date: | June 23
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| Pricing date: | June 24
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| Settlement date: | June 29
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| Agent: | HSBC Securities (USA) Inc.
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| Fees: | 3.5%
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| Cusip: | 40428HTL6
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