By Wendy Van Sickle
Columbus, Ohio, Aug. 16 – HSBC USA Inc. priced $3.32 million of contingent income autocallable step-up securities due Aug. 14, 2020 linked to Amgen Inc. stock, according to a 424B2 filing with the Securities and Exchange Commission.
The notes will pay a contingent quarterly coupon at an annualized rate of 8.3% if Amgen shares close at or above the 80% downside threshold on a determination date for that quarter.
The notes will be called at par plus the contingent coupon if the stock closes at or above the call level on any of the first 11 determination dates. The call level will be 105% of the initial share price on the first four determination dates, stepping up to 110% of the initial share price for the fifth through eighth determination dates and to 115% of the initial share price for the ninth through 11th determination dates.
The payout at maturity will be par plus the final contingent coupon unless the stock finishes below its 80% downside threshold, in which case investors will lose 1% for each 1% decline.
HSBC Securities (USA) Inc. is the agent. Morgan Stanley Wealth Management is handling distribution.
| Issuer: | HSBC USA Inc.
|
| Issue: | Contingent income autocallable step-up securities
|
| Underlying stock: | Amgen Inc.
|
| Amount: | $3,316,570
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| Maturity: | Aug. 14, 2020
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| Coupon: | 8.3% per year, payable quarterly if stock closes at or above downside threshold on determination date for that quarter
|
| Price: | Par
|
| Payout at maturity: | If stock finishes at or above downside threshold, par; otherwise, full exposure to decline
|
| Call: | At par if stock closes at or above call level on first 11 determination dates
|
| Call levels: | 105% of the initial share price on the first four determination dates, stepping up to 110% of the initial share price for the fifth through eighth determination dates and to 115% of the initial share price for the ninth through 11th determination dates
|
| Initial share price: | $169.43
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| Downside threshold: | $135.544, 80% of initial share price
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| Pricing date: | Aug. 11
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| Settlement date: | Aug. 16
|
| Agent: | HSBC Securities (USA) Inc.
|
| Distribution: | Morgan Stanley Wealth Management
|
| Fees: | 2.5%
|
| Cusip: | 40435G683
|
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