Published on 9/4/2020 in the Prospect News Structured Products Daily.
New Issue: HSBC sells $4.31 million autocallable securities with contingent coupon on indexes
By Sarah Lizee
Olympia, Wash., Sept. 4 – HSBC USA Inc. priced $4.31 million of autocallable securities with contingent coupon and contingent downside due Aug. 29, 2024 linked to the least performing of the S&P 500 index, the Russell 2000 index and the Dow Jones industrial average, according to a 424B2 filing with the Securities and Exchange Commission.
Each quarter, the notes pay a contingent coupon at the rate of 8.5% per year if each index closes at or above its coupon trigger, 75% of its initial level, on the observation date for that quarter.
Beginning Feb. 24, 2021, the notes will be called at par if each index closes at or above its initial level on any quarterly call observation date.
The payout at maturity will be par unless any index finishes below its 75% barrier level, in which case investors will lose 1% for every 1% that the least-performing index declines from its initial level.
HSBC Securities (USA) Inc. and Wells Fargo Securities, LLC are the agents.
| Issuer: | HSBC USA Inc.
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| Issue: | Autocallable securities with contingent coupon and contingent downside
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| Underlying indexes: | S&P 500, Russell 2000 and Dow Jones industrial average
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| Amount: | $4,309,000
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| Maturity: | Aug. 29, 2024
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| Coupon: | 8.5% per year, payable quarterly if each index closes at or above coupon trigger on observation date for that quarter
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| Price: | Par
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| Payout at maturity: | Par unless any index finishes below barrier level, in which case 1% loss for every 1% that least-performing index declines from initial level
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| Call: | Beginning Feb. 24, 2021, automatically at par if each index closes at or above initial level on any quarterly call observation date
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| Initial levels: | 3,500.31 for S&P, 1,561.876 for Russell and 28,430.05 for Dow
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| Coupon triggers: | 2,625.2325 for S&P, 1,171.407 for Russell and 21,322.5375 for Dow, or 75% of initial levels
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| Barrier levels: | 2,625.2325 for S&P, 1,171.407 for Russell and 21,322.5375 for Dow, or 75% of initial levels
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| Pricing date: | Aug. 31
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| Settlement date: | Sept. 3
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| Agents: | HSBC Securities (USA) Inc. and Wells Fargo Securities, LLC
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| Fees: | 2.23%
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| Cusip: | 40438CRZ6
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