By Toni Weeks
San Diego, June 5 - HSBC USA Inc. priced $2.13 million of 0% knock-out buffer notes due June 17, 2013 linked to the performance of the Brazilian real relative to the dollar, according to a 424B2 filing with the Securities and Exchange Commission.
A knock-out event occurs if the real has depreciated, as compared to the initial spot rate, by more than 20%.
If a knock-out event occurs, the payout at maturity will be par plus the currency return. Otherwise, the payout will be par plus the greater of the currency return and 10.75%.
The currency return is the quotient of (a) the initial spot rate minus the final spot rate divided by (b) the initial spot rate.
HSBC Securities (USA) Inc. is the underwriter, and J.P. Morgan Securities LLC is the placement agent.
| Issuer: | HSBC USA Inc.
|
| Issue: | Knock-out buffer notes
|
| Underlying currency: | Brazilian real
|
| Amount: | $2,131,000
|
| Maturity date: | June 17, 2013
|
| Coupon: | 0%
|
| Price: | Par
|
| Payout at maturity: | If real has depreciated by more than 20%, par plus currency return; otherwise, par plus greater of currency return and 10.75%
|
| Initial exchange rate: | 2.0350
|
| Pricing date: | June 1
|
| Settlement date: | June 8
|
| Underwriter: | HSBC Securities (USA) Inc. with J.P. Morgan Securities LLC as placement agent
|
| Fees: | 1%
|
| Cusip: | 4042K1R47
|
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