HSBC eyes autocallable contingent income barrier notes tied to stocks

By Sarah Lizee

Olympia, Wash., Oct. 18 – HSBC USA Inc. plans to price autocallable contingent income barrier notes due Nov. 1, 2021 linked to the least performing of the common stocks of Nvidia Corp., Lowe’s Cos., Inc. and Delta Air Lines, Inc., according to an FWP filing with the Securities and Exchange Commission.

Each month the notes will pay a contingent coupon if each stock closes at or above its coupon trigger level, 50% of its initial share price, on the observation date for that month. The contingent coupon rate is expected to be 9.6% to 10.6% per year and will be set at pricing.

The notes will be called at par plus the contingent coupon if each stock closes at or above its initial share price on any quarterly call observation date beginning on Jan. 29, 2019.

The payout at maturity will be par plus the final coupon unless either stock finishes below its 50% barrier level, in which case investors will lose 1% for each 1% decline of the worst-performing stock from its initial level.

HSBC Securities (USA) Inc. is the agent.

The notes (Cusip: 40435F5Z6) will price on Oct. 26 and settle on Oct. 31.

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