Published on 8/29/2017 in the Prospect News Structured Products Daily.
New Issue: HSBC prices $1.31 million callable barrier notes with contingent return on indexes
By Wendy Van Sickle
Columbus, Ohio, Aug. 29 – HSBC USA Inc. priced $1.31 million of callable barrier notes with contingent return due Aug. 30, 2027 linked to the least performing of the S&P 500 index and the Russell 2000 index, according to a 424B2 filing with the Securities and Exchange Commission.
The notes will pay a quarterly contingent coupon at an annualized rate of if each index closes at or above its 70% coupon trigger on the related quarterly observation date. The coupon rate will be 7% for the first five years, stepping up to 8% on Aug. 30, 2022 and to 10% on Aug. 30, 2025.
The notes will be callable at par on any quarterly call date beginning Aug. 27, 2018.
The payout at maturity will be par plus the contingent coupon, if any, unless either index finishes below its 50% barrier level, in which case investors will be fully exposed to any decline of the least performing index.
HSBC Securities (USA) Inc. is the agent.
| Issuer: | HSBC USA Inc.
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| Issue: | Autocallable barrier notes with contingent return
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| Underlying indexes: | S&P 500 index, Russell 2000 index
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| Amount: | $1,312,000
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| Maturity: | Aug. 30, 2027
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| Coupon: | 7% initially, payable each quarter that each index closes at or above its coupon trigger level on the observation date for that quarter; steps up to 8% on Aug. 30, 2022 and to 10% on Aug. 30, 2025
|
| Price: | Par
|
| Payout at maturity: | Par plus contingent coupon unless either index finishes below barrier level, in which case 1% loss for each 1% decline of least performing index from initial level
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| Call: | At par if each index closes at or above initial level on any quarterly date beginning Aug. 27, 2018
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| Initial index levels: | 2,443.05 for S&P, 1,377.453 for Russell
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| Coupon trigger levels: | 1,710.135 for S&P, 964.2171 for Russell; 70% of initial levels
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| Barrier levels: | 1,221.525 for S&P, 688.7265 for Russell; 50% of initial levels
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| Pricing date: | Aug. 25
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| Settlement date: | Aug. 30
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| Agent: | HSBC Securities (USA) Inc.
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| Fees: | 3.75%
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| Cusip: | 40435FEH6
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