HSBC plans trigger autocallable contingent yield notes tied to Facebook

By Angela McDaniels

Tacoma, Wash., July 19 – HSBC USA Inc. plans to price trigger autocallable contingent yield notes due July 25, 2019 linked to the common stock of Facebook, 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 Facebook shares close at or above the downside threshold level on the observation date for that quarter. The downside threshold level is expected to be 68% to 73% of the initial share price and will be set at pricing.

After six months, the notes will be automatically called at par of $10 if Facebook 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. 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 underwriters.

The notes will price July 22.

The Cusip number is 40434V376.

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