By Wendy Van Sickle
Columbus, Ohio, July 10 – HSBC USA Inc. priced $6.86 million of contingent income autocallable securities due July 6, 2020 linked to Citigroup Inc. stock, according to a 424B2 filing with the Securities and Exchange Commission.
The notes will pay a contingent quarterly coupon at an annualized rate of 8.8% if the stock closes at or above its 80% downside threshold on the observation date for that quarter.
The notes will be called at par if the stock closes at or above its redemption price on any quarterly determination date other than the final date. The redemption price will be 105% of the initial price on the first four determination dates, 110% of the initial price on the next four dates and 115% on the final three dates.
If the stock finishes at or above its 80% downside threshold, the payout at maturity will be par plus the final coupon.
Otherwise, investors will be fully exposed to any decline.
HSBC Securities (USA) Inc. is the agent with Morgan Stanley Wealth Management as a dealer.
| Issuer: | HSBC USA Inc.
|
| Issue: | Contingent income autocallable securities
|
| Underlying stock: | Citigroup Inc.
|
| Amount: | $6,857,450
|
| Maturity: | July 6, 2020
|
| Coupon: | 8.8% per year, payable quarterly if stock closes at or above its downside threshold on determination date for that quarter
|
| Price: | Par
|
| Payout at maturity: | If stock finishes at or above downside threshold, par; otherwise, full exposure to decline
|
| Call: | At par if stock closes at or above redemption price on any quarterly determination date other than final date; redemption price will be 105% of the initial price on the first four determination dates, 110% of the initial price on the next four dates and 115% on the final three dates
|
| Initial level: | $66.88
|
| Downside threshold: | $53.504, 80% of initial level
|
| Pricing date: | June 30
|
| Settlement date: | July 6
|
| Agent: | HSBC Securities (USA) Inc.
|
| Selected dealer: | Morgan Stanley Wealth Management
|
| Fees: | 2.5%
|
| Cusip: | 40435D128
|
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