HSBC plans two-year market-linked step-up notes tied to Asian indexes

By Susanna Moon

Chicago, Nov. 7 – HSBC USA Inc. plans to price market-linked step-up notes due December 2019 linked to a basket of Asian indexes, according to an FWP filing with the Securities and Exchange Commission.

The basket consists of the Hang Seng China Enterprises index with an initial weight of 33.33%, the Kospi 200 index with an initial weight of 33.33% and the Taiwan Stock Exchange Capitalization Weighted index with an initial weight of 33.34%

If the basket finishes above the step-up level – 123.5% to 129.5% of the initial level – the payout at maturity will be par of $10 plus the index gain.

If the index gains by up to the step-up level, the payout will be par plus the step-up payment of 23.5% to 29.5%.

Investors will be exposed to any losses.

The exact deal terms will be set at pricing.

BofA Merrill Lynch is the agent.

The notes will price and settle in November.

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