Published on 12/22/2022 in the Prospect News Structured Products Daily.
New Issue: HSBC prices $2.15 million contingent income callables on Russell, S&P, Nasdaq
By William Gullotti
Buffalo, N.Y., Dec. 22 – HSBC USA Inc. priced $2.15 million of contingent income callable securities due June 20, 2025 linked to the worst performing of the Nasdaq-100 index, the Russell 2000 index and the S&P 500 index, according to a 424B2 filing with the Securities and Exchange Commission.
The notes pay a contingent quarterly coupon at an annual rate of 12.65% if each index closes at or above its coupon barrier level, 75% of its initial index level, on the relevant observation date.
HSBC may call the notes at par plus any coupon due on any quarterly determination date.
If each index finishes at or above its coupon barrier, the payout at maturity will be par plus the final coupon.
If the least-performing index finishes below its coupon barrier but at or above its 70% downside threshold level, the payout at maturity will be par. If the final level of any index is less than its downside threshold level, investors will be fully exposed to the decline of the least-performing index from initial level.
HSBC Securities (USA) Inc. is the agent. Distribution is through Morgan Stanley Wealth Management.
| Issuer: | HSBC USA Inc.
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| Issue: | Contingent income callable securities
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| Underlying indexes: | Nasdaq-100, Russell 2000, S&P 500
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| Amount: | $2.15 million
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| Maturity: | June 20, 2025
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| Coupon: | 12.65% per year, payable quarterly if each index closes at or above coupon barrier on the relevant observation date
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| Price: | Par
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| Payout at maturity: | If each index finishes at or above coupon barrier, par plus final coupon; if lowest-performing index finishes below coupon barrier but at or above downside threshold, par; if final level of any index is less than downside threshold level, full exposure to decline of lowest-performing index
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| Call option: | At par plus any coupon due on any quarterly determination date
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| Initial levels: | 11,243.72 for Nasdaq, 3,852.36 for S&P, 1,763.42 for Russell
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| Coupon barriers: | 8,432.79 for Nasdaq, 2,889.27 for S&P, 1,322.565 for Russell; 75% of initial levels
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| Downside threshold: | 7,870.604 for Nasdaq, 2,696.652 for S&P, 1,234.394 for Russell; 70% of initial levels
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| Pricing date: | Dec. 16
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| Settlement date: | Dec. 21
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| Agent: | HSBC Securities (USA) Inc.
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| Distribution: | Morgan Stanley Wealth Management
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| Fees: | 2%
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| Cusip: | 40441XYG9
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