HSBC plans trigger autocallable contingent yield notes linked to Cisco

By Devika Patel

Knoxville, Tenn., Sept. 21 – HSBC USA Inc. plans to price trigger autocallable contingent yield notes due Sept. 26, 2019 linked to the common stock of Cisco Systems, Inc., according to an FWP filing with the Securities and Exchange Commission.

Each quarter, the notes will pay a contingent coupon at the rate of 8% per year if Cisco shares close at or above the downside threshold level, 70% to 75% of the initial share price, on the observation date for that quarter. The exact downside threshold will be set at pricing.

After Dec. 23, 2016, the notes will be automatically called at par of $10 if Cisco shares close at or above the initial share price on any quarterly observation date.

If the notes are not called and the final share price is greater than or equal to the downside threshold level, the payout at maturity will be par plus the contingent coupon, if any. Otherwise, investors will lose 1% for every 1% that the final share price is less than the initial share price.

UBS Financial Services Inc. and HSBC Securities (USA) Inc. are the agents.

The notes (Cusip: 40435B692) will price on Sept. 23 and settle on Sept. 28.

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