Published on 7/28/2023 in the Prospect News Structured Products Daily.
New Issue: HSBC sells $679,000 contingent income barrier autocalls with memory on S&P, Russell
By William Gullotti
Buffalo, N.Y., July 28 – HSBC USA Inc. priced $679,000 of autocallable contingent income barrier notes with memory coupon due July 27, 2026 linked to the performance of the Russell 2000 index and the S&P 500 index, according to a 424B2 filing with the Securities and Exchange Commission.
The notes will pay a contingent semiannual coupon at an annualized rate of 7.65% if each index closes at or above its coupon trigger level, 70% of its initial level, on the observation date for that period. Previously unpaid coupons, if any, will be automatically included whenever coupon payments are made.
The notes will be called at par plus the coupon, and any previously unpaid coupons, if each index closes at or above its initial level on any semiannual call observation date.
If the notes are not called and each index finishes at or above its 70% barrier value, the payout at maturity will be par plus the final coupon plus any previously unpaid coupons. Otherwise, investors will be fully exposed to the decline of the least-performing index from its initial level.
HSBC Securities (USA) Inc. is the agent.
| Issuer: | HSBC USA Inc.
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| Issue: | Autocallable contingent income barrier notes with memory coupon
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| Underlying indexes: | Russell 2000 index, S&P 500 index
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| Amount: | $679,000
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| Maturity: | July 27, 2026
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| Coupon: | 7.65% per year, payable semiannually if each index closes at or above coupon trigger on observation date for that period; coupon payment events will automatically include any previously unpaid coupons
|
| Price: | Par
|
| Payout at maturity: | If each index finishes at or above barrier level, par plus the final coupon and any previously unpaid coupons; otherwise, full exposure to decline of least-performing index from its initial level
|
| Call: | At par plus coupon if each index closes at or above initial level on any semiannual call observation date
|
| Initial levels: | 1,960.255 for Russell, 4,536.34 for S&P
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| Coupon triggers: | 1,372.1785 for Russell, 3,175.438 for S&P; 70% of initial levels
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| Barrier levels: | 1,372.1785 for Russell, 3,175.438 for S&P; 70% of initial levels
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| Pricing date: | July 21
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| Settlement date: | July 26
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| Agent: | HSBC Securities (USA) Inc.
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| Fees: | 1.5%
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| Cusip: | 40447AFB5
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