Published on 6/27/2017 in the Prospect News Structured Products Daily.
New Issue: HSBC prices $9.69 million contingent income callable notes on three indexes
By Wendy Van Sickle
Columbus, Ohio, June 27 – HSBC USA Inc. priced $$9.69 million of contingent income callable securities due March 26, 2020 linked to the worst performing of the Euro Stoxx 50 index, the Russell 2000 index and the S&P 500 index, according to a 424B2 filing with the Securities and Exchange Commission.
Each quarter, the notes pay a contingent coupon at an annual rate of 9.15% if each index closes at or above its coupon barrier level, 75% of its initial index level, on each day during that quarter.
The notes are callable at par on any quarterly determination date.
If each index finishes at or above its 65% downside threshold level, the payout at maturity will be par plus the final contingent coupon, if any. If the final level of any index is less than its downside threshold level, investors will be fully exposed to the decline of the least-performing index.
HSBC Securities (USA) Inc. is the agent. Distribution is through Morgan Stanley Wealth Management.
| Issuer: | HSBC USA Inc.
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| Issue: | Contingent income callable securities
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| Underlying indexes: | Euro Stoxx 50, Russell 2000 and S&P 500
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| Amount: | $9.69 million
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| Maturity: | March 26, 2020
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| Coupon: | 9.15% per year, payable quarterly if each index closes at or above 75% coupon barrier on each day during that quarter
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| Price: | Par
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| Payout at maturity: | If each index finishes at or above downside threshold level, par plus final contingent coupon, if any; if final level of any index is less than 65% downside threshold level, full exposure to decline of lowest-performing index
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| Call option: | At par on any quarterly determination date
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| Initial levels: | 3,543.68 for Euro Stoxx, 2,438.30 for S&P, 1,414.778 for Russell
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| Coupon barriers: | 2,657.76 for Euro Stoxx, 1,828.725 for S&P, 1,061.835 for Russell; 75% of initial levels
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| Downside thresholds: | 2,303.392 for Euro Stoxx, 1,584.895 for S&P, 919.6057 for Russell; 65% of initial levels
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| Pricing date: | June 23
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| Settlement date: | June 28
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| Agent: | HSBC Securities (USA) Inc.
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| Distribution: | Morgan Stanley Wealth Management
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| Fees: | 2.25%
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| Cusip: | 40435FAK3
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