HSBC plans to price seven-year Rate Builder CDs linked to 10 stocks

By Angela McDaniels

Tacoma, Wash., Nov. 7 – HSBC Bank USA, NA plans to price Rate Builder certificates of deposit due Nov. 28, 2023 linked to a basket of 10 stocks assigned Safety Rank 1 by Value Line, according to a term sheet.

The 10 stocks are Bristol-Myers Squibb Co., Eli Lilly & Co., Exxon Mobil Corp., Intel Corp., International Business Machines Corp., McDonald's Corp., Pfizer Inc., Procter & Gamble Co., Verizon Communications Inc. and Wal-Mart Stores, Inc.

According to Value Line, stocks with Safety Rank 1 are “the safest, most stable and least risky investment relative to the Value Line universe” of 1,700 stocks.

Interest will be payable annually. The interest rate will depend on the number of basket stocks that close at or above their initial share prices on the valuation date for that year. The interest rate will be 4% if that number is 10 stocks, 3.2% if the number is nine stocks, 2.4% if the number is eight stocks, 1.6% if the number is seven stocks, 0.8% if the number is six stocks and 0.3% if the number is five or fewer stocks.

The payout at maturity will be par plus the last coupon payment.

HSBC Securities (USA) Inc. is the agent. Incapital LLC is distributor.

The CDs will price Nov. 22.

The Cusip number is 40434YDM6.

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