By Marisa Wong
Madison, Wis., Feb. 9 – HSBC USA Inc. priced $18.82 million of 8.5% STEP Income Securities due Feb. 19, 2016 linked to Micron Technology Inc. shares, according to a 424B2 filing with the Securities and Exchange Commission.
Interest will be payable quarterly.
If Micron Technology stock finishes at or above the 108.5% step level, the payout at maturity will be par of $10 plus the step payment of 1.71%.
If the stock finishes below the step level but at or above the 95% threshold level, the payout will be par.
Otherwise, investors will lose 1% for every 1% decline beyond the 5% buffer.
BofA Merrill Lynch is the agent.
| Issuer: | HSBC USA Inc.
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| Issue: | STEP Income Securities
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| Underlying stock: | Micron Technology Inc. (Nasdaq: MU)
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| Amount: | $18,819,810
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| Maturity: | Feb. 19, 2016
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| Coupon: | 8.5%, payable quarterly
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| Price: | Par of $10
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| Payout at maturity: | If stock finishes at or above the step level, par plus 1.71%; if stock finishes below step level but at or above threshold level, par; otherwise, 1% loss for every 1% drop beyond 5%
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| Initial price: | $29.35
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| Step level: | $31.84, 108.5% of initial price
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| Threshold price: | $27.88, 95% of initial price
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| Pricing date: | Feb. 5
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| Settlement date: | Feb. 12
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| Underwriters: | BofA Merrill Lynch
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| Fees: | 1.75%
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| Cusip: | 40434F553
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