Published on 7/2/2019 in the Prospect News Structured Products Daily.
New Issue: HSBC sells $11.97 million autocallable market-linked step-up notes on basket
By Sarah Lizee
Olympia, Wash., July 2 – HSBC USA Inc. priced $11.97 million of 0% autocallable market-linked step-up notes due June 30, 2022 tied to a basket of indexes, according to a 424B2 filing with the Securities and Exchange Commission.
The basket consists of the Euro Stoxx 50 index with an initial weight of 40%, the FTSE 100 index and the Nikkei Stock Average index each with an initial weight of 20%, the Swiss Market index and the S&P/ASX 200 index each with an initial weight of 7.5% and the Hang Seng index with an initial weight of 5%.
The notes will be called at par of $10 plus a premium of 12.8% per year if the basket's closing level is greater than or equal to the initial level on any annual observation date.
If the basket finishes above the step-up value, 135% of the initial value, the payout at maturity will be par plus the basket return.
If the basket return is zero or positive but the basket finishes at or below the step-up value, the payout will be par plus the step-up payment of 35%.
Investors will be exposed to any losses.
BofA Securities, Inc. is the underwriter.
| Issuer: | HSBC USA Inc.
|
| Issue: | Autocallable market-linked step-up notes
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| Underlying indexes: | Euro Stoxx 50 (40% weight), FTSE 100 and Nikkei Stock (20% weight each), Swiss Market and S&P/ASX 200 (7.5% weight each) and Hang Seng (5% weight)
|
| Amount: | $11,965,800
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| Maturity: | June 30, 2022
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| Coupon: | 0%
|
| Price: | Par of $10
|
| Payout at maturity: | If basket finishes above step-up value, par plus basket return; if basket stays flat or gains but finishes at or below step-up value, par plus 35%; full exposure to decline
|
| Call: | Automatically at par plus a premium of 12.8% per year if the basket's closing level is greater than or equal to the initial level on any annual observation date
|
| Initial levels: | 3,442.38 for Stoxx, 7,402.33 for FTSE, 21,338.17 for Nikkei, 9,859.76 for Swiss, 6,666.313 for S&P/ASX, | 28,621.42 for Hang Seng
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| Step-up value: | 135% of initial value
|
| Pricing date: | June 27
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| Settlement date: | July 5
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| Underwriter: | BofA Securities, Inc.
|
| Fees: | 2%
|
| Cusip: | 40436B626
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