By Wendy Van Sickle
Columbus, Ohio, April 6 – HSBC USA Inc. priced $930,000 of phoenix quarterly review notes with memory coupon due April 16, 2019 linked to the SPDR S&P Oil & Gas Exploration & Production ETF, according to a 424B2 filing with the Securities and Exchange Commission.
If the shares close at or above the trigger price, 75% of the initial share price, on a quarterly observation date, the notes will pay a contingent coupon. If the shares close below the trigger price, no coupon will be paid that quarter. Any contingent coupon that is not paid will be paid at a later time if the ETF shares close above the trigger price on a subsequent observation date. The contingent coupon rate is 12.1% per year.
The payout at maturity will be par plus the contingent coupon unless the shares finish below the trigger price, in which case investors will be fully exposed to the stock’s decline.
The notes will be automatically called at par plus the contingent coupon if the shares close at or above the initial share price on any quarterly observation date.
HSBC Securities (USA) Inc. is the underwriter, and JPMorgan Chase Bank NA and J.P. Morgan Securities LLC are the agents.
| Issuer: | HSBC USA Inc.
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| Issue: | Phoenix quarterly review notes with memory coupon
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| Underlying ETF: | SPDR S&P Oil & Gas Exploration & Production ETF
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| Amount: | $930,000
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| Maturity: | April 16, 2019
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| Coupon: | 12.1% per year if shares close at or above trigger price on applicable quarterly observation date; any contingent coupon that is not paid will be paid at a later time if the ETF shares close above the trigger price on a subsequent observation date
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| Price: | Par
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| Payout at maturity: | Par plus contingent coupon unless shares finish below trigger price, in which case full exposure to decline
|
| Call: | At par plus contingent coupon if shares close at or above initial price on any quarterly observation date
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| Initial share price: | $35.22
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| Trigger price: | $26.415, 75% of initial share price
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| Pricing date: | March 29
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| Settlement date: | April 4
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| Underwriter: | HSBC Securities (USA) Inc.
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| Agents: | JPMorgan Chase Bank NA and J.P. Morgan Securities LLC
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| Fees: | 1%
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| Cusip: | 40435FYC5
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