HSBC to price contingent coupon buffered autocallables on MSCI EAFE

By Marisa Wong

Morgantown, W.Va., Jan. 3 – HSBC USA Inc. plans to price autocallable contingent coupon buffered securities due Jan. 7, 2022 linked to the MSCI EAFE index, according to a 424B2 filing with the Securities and Exchange Commission.

A knock-out event will occur if the index closes below its coupon trigger, 85% of its initial level, on any trading day on or prior to Jan. 4, 2019.

Each month, the notes will pay a contingent coupon at a rate of 3.75% to 3.85% per year if a knock-out event does not occur that month. If a knock-out event does occur, no contingent coupon will be paid for that month or any subsequent month.

If a knock-out event has not occurred, the notes will be automatically called and investors will receive par plus the final contingent coupon on Jan. 4, 2019.

If a knock-out event has occurred, the notes will not be called, and the payout at maturity will be par plus the sum of the index return and 15%. This payout will be greater than par if the index return is greater than negative 15%.

HSBC Securities (USA) Inc. is the agent.

The notes will price on Jan. 4.

The Cusip number is 40435FQK6.

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