Published on 3/13/2020 in the Prospect News Structured Products Daily.
New Issue: HSBC sells $10 million trigger autocallable contingent yield notes on S&P 500
By Wendy Van Sickle
Columbus, Ohio, March 13 – HSBC USA Inc. priced $10 million of trigger autocallable contingent yield notes due March 16, 2022 linked to the S&P 500 index, according to a 424B2 filing with the Securities and Exchange Commission.
Each quarter, the notes will pay a contingent coupon at the rate of 9.35% per year if the index closes at or above the coupon barrier, 70% of the initial index level, on the observation date for that quarter.
After one year, the notes will be automatically called at par of $10 if the index closes at or above the initial index level on any observation date other than the final one.
If the notes are not called and the final index level is greater than or equal to the downside threshold level, 70% of the initial index level, the payout at maturity will be par. Otherwise, investors will lose 1% for every 1% that the final index level is less than the initial index level.
HSBC Securities (USA) Inc. and UBS Financial Services Inc. are the agents.
| Issuer: | HSBC USA Inc.
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| Issue: | Trigger autocallable contingent yield notes
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| Underlying index: | S&P 500
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| Amount: | $9,999,000
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| Maturity: | March 16, 2022
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| Contingent coupon: | 9.35%, payable quarterly if index closes at or above coupon barrier level on related quarterly observation date
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| Price: | Par of $10
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| Payout at maturity: | Par unless index finishes below downside threshold level, in which case 1% loss for each 1% decline from initial price
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| Call: | After one year, automatically at par if index closes at or above initial level on any observation date other than the final one
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| Initial level: | 2,741.38
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| Coupon barrier: | 1,918.97, 70% of initial level
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| Downside threshold: | 1,918.97, 70% of initial level
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| Pricing date: | March 11
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| Settlement date: | March 16
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| Agents: | HSBC Securities (USA) Inc. and UBS Investment Bank
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| Fees: | 1.5%
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| Cusip: | 40438J874
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