Published on 9/24/2007 in the Prospect News Structured Products Daily.
New Issue: HSBC prices $3.09 million 22.5% down & in worst of reverse convertibles tied to stock basket
By Susanna Moon
Chicago, Sept. 24 - HSBC USA Inc. priced a $3.09 million issue of 22.5% down & in worst of reverse convertible notes due Sept. 26, 2008 linked to a basket of stocks, according to a 424B2 filing with the Securities and Exchange Commission.
The basket includes 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. Du Pont de Nemours and Co.
Interest is payable monthly.
The payout will be determined according to the performance of all 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 - 65% 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
|
| Amount: | $3,088,000
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| Underlying shares: | Altria Group, Inc. (NYSE: MO), Citigroup Inc. (NYSE: C), AT&T Inc. (NYSE: T), Pfizer Inc. (NYSE: PFE), JPMorgan Chase & Co. (NYSE: JPM), Merck & Co., Inc. (NYSE: MRK), General Electric Co. (NYSE: GE), Verizon Communications Inc. (NYSE: VZ), General Motors Corp. (NYSE: GM) and E.I. Du Pont de Nemours and Co. (NYSE: DD)
|
| Maturity: | Sept. 26, 2008
|
| Coupon: | 22.5%, 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: | $68.54 for Altria; $47.51 for Citigroup; $42.53 for AT&T; $24.59 for Pfizer; $47.13 for JPMorgan; $51.82 for Merck; $41.25 for GE: $44.38 for Verizon; $34.94 for GM; $49.69 for DuPont
|
| Protection prices: | 65% of initial prices; $44.5510 for Altria; $30.8815 for Citigroup; $27.6445 for AT&T; $15.9835 for Pfizer; $30.6345 for JPMorgan; $33.6830 for Merck; $26.8125 for GE; $28.8470 for Verizon; $22.7110 for GM; and $32.2985 for DuPont
|
| Pricing date: | Sept. 21
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| Settlement date: | Sept. 26
|
| Agent: | HSBC Securities (USA) Inc.
|
| Fees: | 3%
|
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