Published on 11/6/2018 in the Prospect News Structured Products Daily.
New Issue: HSBC sells $2 million contingent coupon autocalls tied to index, ETF
By Sarah Lizee
Olympia, Wash., Nov. 6 – HSBC USA Inc. priced $2 million of market-linked securities due Nov. 5, 2021 – autocallable with contingent coupon and contingent downside linked to the lesser performing of the Russell 2000 index and the iShares MSCI Emerging Markets ETF, according to a 424B2 filing with the Securities and Exchange Commission.
The notes will pay a contingent semiannual coupon at an annual rate of 13.6% if each asset closes at or above its 85% coupon threshold on the observation date for that period.
The notes will be called at par if each asset closes at or above its initial level on any semiannual observation date beginning May 2, 2019.
The payout at maturity will be par unless either asset finishes below its 70% downside threshold, in which case the payout will be par plus the return of the worse performing index with full exposure to any losses.
HSBC Securities (USA) Inc. is the agent.
| Issuer: | HSBC USA Inc.
|
| Issue: | Market-linked securities – autocallable with contingent coupon and contingent downside
|
| Underlying assets: | Russell 2000, iShares MSCI Emerging Markets ETF
|
| Amount: | $2 million
|
| Maturity: | Nov. 5, 2021
|
| Coupon: | 13.6%, payable semiannually if each asset closes above coupon barrier
|
| Price: | Par
|
| Payout at maturity: | Par plus any contingent coupon unless any asset finishes below trigger level, in which case full exposure to any losses of the worst performing asset
|
| Call: | At par if each asset closes at or above its initial level on any semiannual observation date after one year
|
| Initial levels: | 1,547.981 for index, $40.82 for ETF
|
| Coupon barrier: | 1,315.78385 for index, $34.697 for ETF, 85% of initial values
|
| Downside threshold: | 1,083.5867 for index, $28.574 for ETF, 70% of initial values
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| Pricing date: | Nov. 2
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| Settlement date: | Nov. 7
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| Agent: | HSBC Securities (USA) Inc.
|
| Fees: | 0.5%
|
| Cusip: | 40435UAQ7
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