By Angela McDaniels
Tacoma, Wash., June 27 – HSBC USA Inc. priced $1.35 million of callable notes with contingent return due June 28, 2022 linked to the lesser performing of the SPDR S&P Biotech exchange-traded fund and the Technology Select Sector SPDR fund, according to a 424B2 filing with the Securities and Exchange Commission.
Every six months, the notes will pay a contingent coupon at the rate of 8.8% per year if each ETF closes at or above its coupon trigger, 60% of its initial share price, on the observation date for that semiannual period.
The notes are callable at par semiannually.
If the notes are not called, the payout at maturity will be par unless the return of the lesser-performing ETF is less than negative 40%, in which case investors will lose 1% for every 1% that the lesser-performing ETF declines from its initial share price.
HSBC Securities (USA) Inc. is the underwriter.
| Issuer: | HSBC USA Inc.
|
| Issue: | Callable notes with contingent return
|
| Underlying ETFs: SPDR S&P Biotech ETF and Technology Select Sector SPDR fund
|
| Amount: | $1,345,000
|
| Maturity: | June 28, 2022
|
| Coupon: | 8.8% per year, payable semiannually if each ETF closes at or above coupon trigger on observation date for that semiannual period
|
| Price: | Par
|
| Payout at maturity: | Par unless return of lesser-performing ETF is less than negative 40%, in which case 1% loss for every 1% that lesser-performing ETF declines from initial share price
|
| Call option: | At par semiannually
|
| Initial share prices: | $87.26 for biotech ETF and $78.31 for tech fund
|
| Coupon triggers: | $52.356 for biotech ETF and $46.986 for tech fund, or 60% of initial share prices
|
| Pricing date: | June 21
|
| Settlement date: | June 28
|
| Underwriter: | HSBC Securities (USA) Inc.
|
| Fees: | 1.5%
|
| Cusip: | 40435UQG2
|
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