Published on 2/9/2009 in the Prospect News Structured Products Daily.
New Issue: HSBC USA prices $24.37 million semiannual review notes linked to S&P 500 via JPMorgan
By Angela McDaniels
Tacoma, Wash., Feb. 9 - HSBC USA Inc. priced $24.37 million of 0% semiannual review notes due Feb. 10, 2011 linked to the S&P 500 index, according to a 424B2 filing with the Securities and Exchange Commission.
J.P. Morgan Securities Inc. is the agent.
If the index closes at or above its call level on a semiannual valuation date, then the notes will be automatically called and investors will receive par plus an annualized return of 13.2%. The valuation dates are Aug. 6, 2009, Feb. 12, 2010, Aug. 5, 2010 and Feb. 7, 2011. The call level is 80% of the initial index level on the first valuation date, 90% of the initial level on the second valuation date and 100% of the initial level on the third and fourth valuation dates.
If the notes are not called, then the payout at maturity will be par unless the index declines by more than 10%. In that case, investors will lose 1.1111% for every 1% decline beyond 10%.
| Issuer: | HSBC USA Inc.
|
| Issue: | Semiannual review notes
|
| Underlying index: | S&P 500
|
| Amount: | $24.37 million
|
| Maturity: | Feb. 10, 2011
|
| Coupon: | 0%
|
| Price: | Par
|
| Payout at maturity: | If final index level is at least 90% of initial level, par; otherwise, 1.1111% loss for every 1% decline beyond 10%
|
| Call: | Automatically at par plus annualized return of 13.2% if index closes at or above its call level on a semiannual valuation date; call level is 80% of initial index level on Aug. 6, 2009, 90% of the initial level on Feb. 12, 2010 and 100% of the initial level on Aug. 5, 2010 and Feb. 7, 2011
|
| Initial index level: | 868.6
|
| Pricing date: | Feb. 6
|
| Settlement date: | Feb. 11
|
| Agent: | J.P. Morgan Securities Inc.
|
| Fees: | 1.5%
|
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