Published on 7/15/2020 in the Prospect News Structured Products Daily.
New Issue: HSBC prices $500,000 inverse phoenix monthly review notes on Tesla
By Kiku Steinfeld
Chicago, July 15 – HSBC USA Inc. priced $500,000 of inverse phoenix monthly review notes with memory coupon feature due Oct. 14, 2020 linked to the common shares of Tesla, Inc., according to a 424B2 filing with the Securities and Exchange Commission.
The notes will pay a contingent monthly coupon at an annualized rate of 14% if the shares close at or below their 140% coupon barrier on a monthly observation date. If a coupon payment is missed because the stock closes above the barrier, it will be paid on the next coupon payment date that the stock closes at or below the barrier.
The notes will be called at par if the shares close below the initial share price on Aug. 11 or Sept. 9.
If the notes are not called, the payout at maturity will be par unless the shares finish above the 140% trigger level, in which case investors will lose 1% for every 1% that the stock increases.
HSBC Securities (USA) Inc. is the agent, and JPMorgan Chase Bank, NA and J.P. Morgan Securities LLC are the placement agents.
| Issuer: | HSBC USA Inc.
|
| Issue: | Inverse phoenix monthly review notes with memory coupon feature
|
| Underlying stock: | Tesla, Inc.
|
| Amount: | $500,000
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| Maturity: | Oct. 14, 2020
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| Coupon: | 14%, payable monthly if stock closes at or below coupon barrier on any monthly observation date; if coupon payment is missed, it will be paid on next coupon payment date that stock closes at or below barrier
|
| Price: | Par
|
| Payout at maturity: | Par unless stock finishes above trigger level, in which case 1% loss for every 1% that stock increases
|
| Call: | At par if stock closes below initial share price on Aug. 11 or Sept. 9
|
| Initial level: | $1,365.88
|
| Trigger level: | $1,912.232, 140% of initial level
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| Pricing date: | July 8
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| Settlement date: | July 14
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| Agent: | HSBC Securities (USA) Inc. with JPMorgan Chase Bank, NA and J.P. Morgan Securities LLC as placement agents
|
| Fees: | 0.25%
|
| Cusip: | 40438CNJ6
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