Published on 12/28/2022 in the Prospect News Structured Products Daily.
New Issue: HSBC sells $450,000 callable contingent income barrier notes on four consumer stocks
By William Gullotti
Buffalo, N.Y., Dec. 28 – HSBC USA Inc. priced $450,000 of callable contingent income barrier notes due May 5, 2025 linked to the performance of Walmart Inc., Costco Wholesale Corp., Target Corp. and the Amazon.com, Inc., according to a 424B2 filing with the Securities and Exchange Commission.
The notes will pay a contingent monthly coupon at an annual rate of 15.55% if each stock closes at or above its trigger level, 70% of its initial level, on the observation date for that period.
The notes will be callable at par plus any coupon due on any monthly call observation date after three months.
The payout at maturity will be par plus the final coupon if each stock finishes above its coupon trigger level.
If any stock lags below the trigger level, but every stock finishes at or above its 50% barrier level, the payout at maturity will be par. Otherwise, investors will be fully exposed to the decline of the lowest performing stock from its initial level.
HSBC Securities (USA) Inc. is the agent.
| Issuer: | HSBC USA Inc.
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| Issue: | Callable contingent income barrier notes
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| Underlying stocks: | Walmart Inc., Costco Wholesale Corp., Target Corp., Amazon.com, Inc.
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| Amount: | $450,000
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| Maturity: | May 5, 2025
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| Coupon: | 15.55%, payable monthly if each stock closes at or above trigger level on determination date for that period
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| Price: | Par
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| Payout at maturity: | If each stock finishes at or above trigger level, par plus the final coupon; if any stock falls below trigger level, but each stock finishes at or above barrier level, par; otherwise, exposure to decline of worst-performing stock from its initial level
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| Call option: | At par plus any coupon due on any monthly call observation date after three months
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| Initial level: | $156.21 for Walmart, $562.00 for Costco, $236.39 for Target, $2,891.93 for Amazon
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| Trigger levels: | $109.347 for Walmart, $393.40 for Costco, $165.473 for Target, $2,024.351 for Amazon; 70% of initial levels
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| Barrier levels: | $78.105 for Walmart, $281.00 for Costco, $118.195 for Target, $1,445.965 for Amazon; 50% of initial levels
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| Pricing date: | April 28
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| Settlement date: | May 3
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| Agent: | HSBC Securities (USA) Inc.
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| Fees: | 0.75%
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| Cusip: | 40439JY82
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