By Wendy Van Sickle
Columbus, Ohio, Feb. 14 – HSBC USA Inc. priced $3.08 million of autocallable contingent income barrier notes due Dec. 27, 2019 linked to the iShares U.S. Home Construction exchange-traded fund and the SPDR Oil & Gas Exploration & Production exchange-traded fund, according to a 424B2 filing with the Securities and Exchange Commission.
If each asset closes at or above its coupon trigger, 70% of its initial price, on a quarterly observation date, the notes will pay a contingent coupon that quarter at an annual rate of 10.1%.
The notes will be called at par plus the contingent coupon if each asset closes at or above its initial price on any quarterly observation date after one year.
The payout at maturity will be par plus the contingent coupon unless any asset finishes below the 70% barrier level, in which case investors will lose 1% for each 1% decline of the worst performing asset from its initial price.
HSBC Securities (USA) Inc. is the agent.
| Issuer: | HSBC USA Inc.
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| Issue: | Autocallable contingent income barrier notes
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| Underlying ETFs: iShares U.S. Home Construction ETF and SPDR Oil & Gas Exploration & Production ETF
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| Amount: | $3,083,000
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| Maturity: | Dec. 27, 2019
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| Coupon: | 10.1% annualized, payable each quarter that each asset 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 contingent coupon unless any asset finishes below barrier price, in which case 1% loss for each 1% decline of least performing asset from initial level
|
| Call: | At par if each asset closes at or above initial level on any quarterly observation date after one year
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| Initial prices: | $39.33 for iShares U.S. Home Construction ETF, $32.38 for SPDR Oil & Gas Exploration & Production ETF
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| Coupon triggers: | $27.53 for iShares U.S. Home Construction ETF, $22.67 for SPDR Oil & Gas Exploration & Production ETF; 70% of initial prices
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| Barriers: | $27.53 for iShares U.S. Home Construction ETF, $22.67 for SPDR Oil & Gas Exploration & Production ETF; 70% of initial prices
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| Pricing date: | Feb. 8
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| Settlement date: | Feb. 14
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| Agent: | HSBC Securities (USA) Inc.
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| Fees: | 2%
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| Cusip: | 40435FTK3
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