HSBC plans contingent income barrier autocallables linked to oil ETF

By Angela McDaniels

Tacoma, Wash., May 7 – HSBC USA Inc. plans to price autocallable contingent income barrier notes due May 2019 linked to the SPDR S&P Oil & Gas Exploration and Production exchange-traded fund, according to an FWP filing with the Securities and Exchange Commission.

Each quarter, the notes will pay a contingent coupon at the rate of at least 6% per year if the ETF closes at or above the barrier level, 60% of the initial share price, on the determination date for that quarter. The exact contingent coupon rate will be set at pricing.

The notes will be automatically called at par if the ETF closes at or above the initial share price on any annual call observation date.

If the notes are not called and the ETF finishes at or above the barrier level, the payout at maturity will be par. Otherwise, the payout will be a number of shares of the ETF equal to $1,000 divided by the initial share price.

HSBC Securities (USA) Inc. is the agent.

The notes will price and settle in May.

The Cusip number is 40433BW20.

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