By Angela McDaniels
Tacoma, Wash., June 13 - HSBC USA Inc. priced $5 million of autocallable buffered range accrual notes due June 18, 2018 linked to a basket of common stocks, according to a 424B2 filing with the Securities and Exchange Commission.
The basket includes equal weights of BHP Billiton Ltd., Freeport-McMoRan Copper & Gold Inc. and Rio Tinto plc.
The interest rate is 6.5% per year multiplied by the proportion of days on which the basket level is greater than or equal to the accrual level, 80% of the initial basket level. Interest is payable quarterly.
Beginning June 11, 2014, the notes will be automatically called at par if the basket closes at or above its initial level on any annual call observation date.
If the notes are not called, the payout at maturity will be par if the basket finishes at or above the buffer level, which is 80% of the initial level. Investors will lose 1% for each 1% that the basket declines beyond 20%, if any.
HSBC Securities (USA) Inc. is the underwriter.
| Issuer: | HSBC USA Inc.
|
| Issue: | Autocallable buffered range accrual notes
|
| Underlying stocks: | BHP Billiton Ltd., Freeport-McMoRan Copper & Gold Inc. and Rio Tinto plc, equally weighted
|
| Amount: | $5 million
|
| Maturity: | June 18, 2018
|
| Coupon: | 6.5% per year multiplied by proportion of days on which basket level is greater than or equal to accrual level, 80% of initial basket level; payable quarterly
|
| Price: | Par
|
| Payout at maturity: | Par if final basket level is at least 80% of initial level; otherwise, 1% loss for each 1% that basket declines beyond 20%
|
| Call: | Beginning June 11, 2014, notes will be automatically called at par if basket closes at or above initial level on any annual call observation date
|
| Initial share prices: | $62.45 for BHIP Billiton; $29.32 for Freeport-McMoRan; $41.97 for Rio Tinto
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| Pricing date: | June 11
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| Settlement date: | June 18
|
| Underwriter: | HSBC Securities (USA) Inc.
|
| Fees: | 1.5%
|
| Cusip: | 40432XFJ5
|
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