HSBC intends to price contingent income autocallables on Marathon Oil

By Devika Patel

Knoxville, Tenn., May 18 – HSBC USA Inc. plans to price contingent income autocallable securities due Nov. 29, 2018 linked to the common stock of Marathon Oil Corp., according to an FWP filing with the Securities and Exchange.

If Marathon Oil shares close at or above the downside threshold level, 80% of the initial level, on any monthly determination date or the maturity date, the notes will pay a contingent payment that month at an annualized rate of at least 18%. The exact coupon will be set at pricing.

The notes will be called at par of $10 plus the contingent coupon if Marathon Oil shares close at or above the initial share price on any of the first five monthly determination dates beginning June 25, 2018.

If the final share price is greater than or equal to the downside threshold level, 80% of the initial level, the payout at maturity will be par plus the final contingent coupon. Otherwise, investors will lose 1% for each 1% decline of the stock.

HSBC Securities (USA) Inc. is the agent, with Morgan Stanley Wealth Management handling distribution.

The notes (Cusip: 40435M227) will price on May 25 and settle three business days after pricing.

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