By Angela McDaniels
Tacoma, Wash., Oct. 1 – HSBC USA Inc. priced $2.18 million of 0% autocallable step-up securities due Sept. 30, 2020 linked to the iShares MSCI Emerging Markets exchange-traded fund, according to a 424B2 filing with the Securities and Exchange Commission.
Beginning Sept. 27, 2016, the notes will be automatically called at par of $10 plus a call premium of 9% per year if the ETF closes at or above the initial share price on any quarterly determination date.
If the notes are not called and the final share price is greater than or equal to the initial share price, the payout at maturity will be par plus 45%.
If the final share price is less than the initial share price but greater than or equal to the downside threshold value, 65% of the initial share price, the payout will be par.
If the final share price is less than the downside threshold level, investors will be fully exposed to the ETF’s decline from its initial share price.
HSBC Securities (USA) Inc. is the agent. Distribution is through Morgan Stanley Wealth Management.
| Issuer: | HSBC USA Inc.
|
| Issue: | Autocallable step-up securities
|
| Underlying ETF: | iShares MSCI Emerging Markets ETF
|
| Amount: | $2,177,000
|
| Maturity: | Sept. 30, 2020
|
| Coupon: | 0%
|
| Price: | Par of $10.00
|
| Payout at maturity: | If final share price is greater than or equal to initial share price, be par plus 45%; if final share price is less than initial share price but greater than or equal to downside threshold value, par; if final share price is less than downside threshold level, full exposure to ETF’s decline from initial share price
|
| Call: | Beginning Sept. 27, 2016, notes will be automatically called at par plus call premium of 9% per year if ETF closes at or above initial share price on any quarterly determination date
|
| Initial share price: | $32.40
|
| Downside threshold: | $21.06, 65% of initial share price
|
| Pricing date: | Sept. 25
|
| Settlement date: | Sept. 30
|
| Agent: | HSBC Securities (USA) Inc.
|
| Distribution: | Morgan Stanley Wealth Management
|
| Fees: | 3%
|
| Cusip: | 40434K768
|
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