Published on 2/12/2018 in the Prospect News Structured Products Daily.
New Issue: HSBC prices $962,000 autocallable barrier notes with contingent return on indexes
By Tali Rackner
Minneapolis, Feb. 12 – HSBC USA Inc. priced $962,000 of autocallable barrier notes with contingent return due July 31, 2019 linked to the lesser performing of the S&P 500 index and the Russell 2000 index, according to a 424B2 filing with the Securities and Exchange Commission.
If each index closes at or above its coupon trigger, 75% of its initial level, on a quarterly observation date, the notes will pay a contingent coupon that quarter at an annual rate of 5%.
The notes will be called at par plus the contingent coupon if each index closes at or above its initial level on any quarterly observation date beginning July 26.
The payout will be par plus the final coupon unless each index return is negative or if either index has finished below its 75% barrier level on any day during the life of the notes, in which case investors will lose 1% for each 1% decline of the lesser-performing index from its initial level.
HSBC Securities (USA) Inc. is the agent.
Issuer: | HSBC USA Inc.
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Issue: | Autocallable barrier notes with contingent return
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Underlying indexes: | S&P 500 and Russell 2000
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Amount: | $962,000
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Maturity: | July 31, 2019
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Coupon: | 5% annualized, payable each quarter that each index closes at or above its coupon trigger on the observation date for that quarter
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Price: | Par
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Payout at maturity: | Par plus final coupon unless each index return is negative or if either index has finished below barrier level on any day during the life of the notes, in which case investors will lose 1% for each 1% decline of lesser-performing index from its initial level
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Call: | At par if each index closes at or above initial level on any quarterly observation date beginning July 26
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Initial index levels: | 2,872.87 for S&P, 1,608.058 for Russell
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Coupon trigger/barriers: | 2,154.65 for S&P, 1,206.044 for Russell; 75% of initial levels
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Pricing date: | Jan. 26
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Settlement date: | Jan. 31
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Agent: | HSBC Securities (USA) Inc.
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Fees: | 1.875%
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Cusip: | 40435FQU4
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