EFTA01140705.pdf

Page 1 of 11 424B2 I v338382_424b2.htm PRICING SUPPLEMENT CALCULATION OF REGISTRATION FEE Title of Each Class of Maximum Aggregate Amount of Securities Offered Offering Price Registration Fedi) Debt Securities 55.950.(X)0.00 $811.58 (II Calculated in accordance with Rule 457 (r) of the Securities Act of 1933. as amended. Filed Pursuant to Rule 42400(2) Registration No. 333-180289 PRICING SUPPLEMENT Dated March 13. 2013 HSBC (To Prospectus dated March 22.2012 and Prospectus Supplement dated March 22. 2012) Structured HSBC USA Inc. Investments $5.950.0(8) Barrier Notes with Step Up Digital Return Linked to the Performance of the Brazilian Real Relative to the U.S. Dollar due March 27.2014 General • Terms used in this pricing supplement are described or defined herein, in the prospectus supplement and in the prospectus. The Notes will have the terms described herein and in the prospectus supplement and prospectus. The Notes do not guarantee any return of principal, and you may lose up to 100% of your initial investment. The Notes will not bear interest. • This pricing supplement relates to a single note offering. The purchaser of a Note will acquire a security linked to a single Reference Currency described below. • Although the offering relates to a Reference Currency. you should not construe that fact as a recommendation as to the merits of acquiring an investment linked to the Reference Currency or as to the suitability of an investment in the Notes. • Senior unsecured debt obligations of HSBC USA Inc. maturing March 27. 2014. • Minimum denominations of $10.(X)1and integral multiples of 51.000 in excess thereof. • If the terms of the Notes set forth below are inconsistent with those described in the prospectus supplement and prospectus. the terms set forth below will supersede. • Any payment on the Notes is subject to the Issuer's credit risk. Key Terms Issuer: HSBC USA Inc. Reference Currency: Brazilian Real per one U.S. Dollar ("USDBRL") Principal Amount: 51.000 per Note. Barrier Level: -15% Trade Date: March 13. 2013 Pricing Date: March 13. 2013 Original Issue Date: March 20. 2013 Final Valuation Date: March 20. 2014. subject to adjustment as described herein. Maturity Date: March 27. 2014. The Maturity Date is subject to further adjustment as described under "Market Disruption Events" herein. Payment at Maturity•: If the Reference Currency Return is greater than 3%. you will receive a cash payment per 51.000 Principal Amount of Notes equal to 51.285A)0. If the Reference Currency Return is greater than zero but less than or equal to 3%. you will receive a cash payment per 51.0(al Principal Amount of Notes equal to $1,050.00. If the Reference Currency Return is less than or equal to zero but greater than or equal to the Barrier Level. meaning that the Reference Currency depreciates against the U.S. Dollar by no more than 15% on the Final Valuation Date. you will receive $1.000. the Principal Amount (a zero return). If the Reference Currency Return is less than the Barrier Level. meaning that the Reference Currency depreciates against the U.S. Dollar by more than 15% on the Final Valuation Date, you will lose 1% of the Principal Amount for each percentage point that the Reference Currency Return is below zero. calculated as follows: $1,000 + (51.0(XD x Reference Currency Return). This means that if the Reference Currency Return is -100%. you will lose your entire investment. Reference Currency The quotient. expressed as a percentage. calculated as follows: Return: Initial Soot Rate —Final Soot Rate Initial Spot Rate Spot Rate: The Spot Rate for the Brazilian real relative to the U.S. dollar (the "USDBRL'•) on each date of calculation will be the U.S. dollar/Brazilian real exchange rate. expressed as the amount of Brazilian reels per one U.S. dollar, for settlement on the same day. as reported by Banco Central do Brasil on SISBACEN Data System under transaction code PTAX-800 ("Consulta de Cambio" or Exchange Rate Inquiry). Option 5 ("Cotacoes pare Cotabilidade" or Rates for Accounting Purposes) at approximately 1:15 p.m.. Sao Paulo time. which appears on Reuters page "BRIlt" to the right of the caption "Dollar MAX". or any successor page. The USDBRL shall be calculated to the fourth decimal place. Initial Spot Rate: 1.9619 Final Spot Rate: The Spot Rate as determined by the Calculation Agent in its sole discretion on the Final Valuation Date. Calculation Agent: HSBC or one of its affiliates CUSIPASIN: 40432XD32JUS40432XD326 Form of Notes: Book-Entry Listing: The Notes will not be listed on any U.S. securities exchange or quotation system. http://www.sec.gov/Arehives/edgar/data/83246/000114420413015558/v338382_424b2.htm 10/29/2013 EFTA01140705  Page 2 of 11 Investment in the Notes involves certain risks. You should refer to "Selected Risk Considerations" beginning on page 5 of this document and "Risk Factors" beginning on page S-3 of the prospectus supplement. Neither the U.S. Securities and Exchange Commission. or SEC. nor any state securities commission has approved or disapproved of the Notes or determined that this pricing supplement. or the accompanying prospectus supplement and prospectus, is truthful or complete. Any representation to the contrary is a criminal offense. HSBC Securities (USA) Inc. or another of our affiliates or agents may use this pricing supplement in market-making transactions in any Notes after their initial sale. Unless we or our agent informs you otherwise in the confirmation of sale, this pricing supplement will be used in a market-making transaction. HSBC Securities (USA) Inc.. an affiliate of nun. will purchase the Notes from us for distribution to the placement agent. See "Supplemental Plan of Distribution (Conflicts of Interest)" on the last page of this pricing supplement. J.P. Morgan Securities LLC and certain of its registered broker-dealer affiliates are purchasing the Notes for resale. Price to Public Fees and Commissions Proceeds to Issuer Per Note 51.000 510 5990 Total 55.950.000 559.500 55.890.500 The Notes: Are Not FDIC Insured Are Not Bank Guaranteed I May Lose Value JPMorgan Placement Agent March 13. 2013 http://www.sec.gov/Arehives/edgar/data/83246/000114420413015558/v338382_424b2.htm 10/29/2013 EFTA01140706  Page 3 of 11 Additional Terms Specific to the Notes This pricing supplement relates to a single note offering linked to the Reference Currency identified on the cover page. The purchaser of a Note will acquire a senior unsecured debt security linked to the Reference Currency. Although the Note offering relates only to the Reference Currency identified on the cover page. you should not construe that fact as a recommendation as to the merits of acquiring an investment linked to the Reference Currency or as to the suitability of an investment in the Notes. You should read this document together with the prospectus dated March 22. 2012 and the prospectus supplement dated March 22. 2012.1f the terms of the Notes offered hereby are inconsistent with those described in the accompanying prospectus supplement or prospectus. the terms described in this pricing supplement shall control. You should carefully consider, among other things. the matters set forth in "Selected Risk Considerations" beginning on page 5 of this pricing supplement and "Risk Factors" beginning on page S-3 of the prospectus supplement. as the Notes involve risks not associated with conventional debt securities. We urge you to consult your investment, legal. tax. accounting and other advisors before you invest in the Notes. As used herein. references to the "Issuer". "HSBC". "we". "us" and "our" are to HSBC USA Inc. HSBC has filed a registration statement (including a prospectus and a prospectus supplement) with the SEC for the offering to which this pricing supplement relates. Before you invest. you should read the prospectus and prospectus supplement in that registration statement and other documents HSBC has filed with the SEC for more complete information about HSBC and this offering. You may get these documents for free by visiting EDGAR on the SEC's web site at www.sec.gov. Alternatively. HSBC Securities (USA) Inc. or any dealer participating in this offering will arrange to send you the prospectus and prospectus supplement if you request them by calling toll-free I-866-811-8049. You may also obtain: • The prospectus supplement at: hitp://www.sec.gov/Archivestedear/data/83246/0001047469 1200315 l/a2208335z424b2.htm • The prospectus at: http://www.sec.gov/Archiveskdgar/data/83246/0001047469 I 2003 14S/a2208395z424b2.htm http://www.sec.gov/Arehives/edgar/data/83246/000114420413015558/v338382_424b2.htm 10/29/2013 EFTA01140707  Page 4 of 1I Summary The four charts below provide a summary of the Notes. including Note characteristics and risk considerations, as well as an illustrative diagram and table reflecting hypothetical returns at maturity. These charts should be reviewed together with the disclosure regarding the Notes contained in this pricing supplement as well as in the accompanying prospectus and prospectus supplement. The following charts illustrate the hypothetical total return at maturity on the Notes. The "total return" as used in this pricing supplement is the number. expressed as a percentage. that results from comparing the Payment at Maturity per S1.000 Principal Amount of Notes to S1.0410. The hypothetical total returns set forth below reflect the Initial Spot Rate of 1.9619 and the other terms set forth below. The hypothetical total returns set forth below are for illustrative purposes only and may not be the actual total returns applicable to a purchaser of the Notes. The numbers appearing in the following table and examples have been rounded (or ease of analysis. Note charaCteriStiCS Hypothetical Total Return on the None., Reference Ctrrency: Branton Real per one U.S. Dollar Currency: USD Barrier Level: -15% Final Valuation Date: March 20, 2014 (expected) •IS Maximum potential Gain: 2850% Maximun potential loss: 100.00% ••• Maturity: 53 men Settlement: Cash • Appreciation Potential: 1 - The Notes provide the oppodunity to receive a 5% return at maturity It trie Reference Currency Rehm is greater than 0%. Yid a 28.50% return at niatirCy if the Reference Currency Rehm is greater than 3%. - ...NO.. • No Guaranteed Return of Principal: ••• - Fun poncipa n sk if the Reference Currency Return is less than the Bamer Level Summary Selected Risk Considerations (see paw 5) ilypoilvtool nos l+nothrial 8•feonoe rhymer/on Total Re-non Semi Ray Currency Rotten on the Nate. WO wg. you :o read 'Seined Risk Considerations' reran and Factors Ovonnine on page 5-3 of tre prospectus supplement Imansog m the Notes ts not 0 0000 too.oft 33.50% eceavalert n nveetng care* in tie Reference amen. You should understand the 0 3924 slam Z3.50% roks of infesting in the Notes and should reach an intesnent decision only otter careful cormdean wth your advisors. or he unable, of the Notes h Ight of your 0 7848 ao.cogi 28 50% particular fraccal orcumstances and the .nformason set forth in this priOrg 06810 nom 3360% %0therimra and the exonthenr0 prospectus supplement and prospectus. 1.1771 40.00% 33.50% &abbacy of the Non be irmesenent I 3733 93.00% 28.50% You investment in the Notes nay result in a loss. 1 6606 2010% 21360% TM madman returnon the Notes 15 tended The Notes are sutseet to te audit risk of HSBC USA Inc I 0376 15.00% 33.50% Investno an the Non is rot equvalent to invest no cthecty .n the Reference I 7857 1000% 28.50% CurrenCy Omen marlin may be volt,. 3.60% IBMS Legal and regintoy reeks 0370 3.00% 5.00% V the Imathey of the Reference Caen is inn. the vaue the Nobs could 16227 :13% 5 OD% fitly be rand We WO CCobei over re °Change rte behre.e the Rea nOPC rosy and 1.9010 0.00% 0.00% the t) S Dear. 20011 2 DO% 0.00% Tie Panne fawn for the Nabs will rot take mm axourt all develop-nn en the Reference Curren. 2.0600 .5 X.ei 0.0D% The Notes are Satin to emerging marlin polecat arid economic Mks. The Non are sin& to annoy exchange Mk 2 1581 .le X% 0.00% Nonterest rernenek •15.00% 0.00% Ntentialy to:OnaMert refOrCh. opirronS a recommend:eons b ./ IISI3C and 2 3543 CV 00% -7C 03% JP1.10Mark Conan Within open as Wooly to ochry:0y Meet ale value of Mei Notes prior to 2 4524 -25 CO% -25 OD% 2.6505 The Notes tete Sauckhr. Potent.' 0:00.05. 2 7167 -40.00% -I0.00% Tho Naas are ret mewed oe guaramin by any governmental agency of the 2 9420 10 00% -50 00% Unteci States of any other junsamon Historical Performance of the Reference Currency should not be taken as an 3 1303 .6000% -00.00% wocation of the Mute performance of the Reference Currency Minna the bun of 36314 420.00% -80.00% the NOM Mackie nrupoorm may adversely affect you' nun 3 9238 -10000% -100.00% Many moron and market facto. wit intact the value of to nobs. The amount [dyable on the Notes is rot braes toe* Soot Rate of the Reference Canny at any orb on man on the Final Val aeon Dale http://www.sec.gov/Arehives/edgar/data/83246/000114420413015558/v338382_424b2.htm 10/29/2013 EFTA01140708  Page 5 of 11 Selected Purchase Considerations • APPRECIATION POTENTIAL —The Notes provide the opportunity to receive a 5% return at maturity if the Reference Currency Return is greater than 0%. and a 28.50% return at maturity if the Reference Currency Return is greater than 3%. Because the Notes are our senior unsecured debt obligations, payment of any amount at maturity is subject to our ability to pay our obligations as they become due. • LOSS OF PRINCIPAL IF THE REFERENCE CURRENCY RETURN IS LESS THAN THE BARRIER LEVEL - if the Reference Currency Return is greater than or equal to the Barrier Level of -15%, you will receive at least the Principal Amount at maturity. even if the Reference Currency has depreciated against the U.S. Dollar as compared to the Initial Spot Rate. If the Reference Currency Return is less than the Barrier Level, you will lose 1% of your Principal Amount for every 1% that the Reference Currency has depreciated against the U.S. Dollar as compared to the Initial Spot Rate. If the Reference Currency Return is -100%. you will lose your entire investment. • EXPOSURE TO THE BRAZILIAN REAL VERSUS THE US. DOLLAR — The return on the Notes is linked to the performance of the Brazilian Real. which we refer to as the Reference Currency. relative to the U.S. Dollar, and will enable you to participate in any appreciation of the Reference Currency relative to the U.S. Dollar from the Pricing Date to the Final Valuation Date. • TAX TREATMENT — There is no direct legal authority as to the proper tax treatment of the Notes. and therefore significant aspects of the tax treatment of the Notes are uncertain as to both the timing and character of any inclusion in income in respect of the Notes. Under one approach. a Note should be treated as a pre-paid executor• contract with respect to the Reference Currency. We intend to treat the Notes consistent with this approach. Pursuant to the terms of the Notes. you agree to treat the Notes under this approach for all US. federal income tax purposes. Subject to the limitations described therein. and based on certain factual representations received from us. in the opinion of our special U.S. tax counsel. Morrison & Foerster LLP, it is reasonable to treat a Note as a pre-paid executory contract with respect to the Reference Currency. Assuming this characterization is respected. upon a sale or exchange of a Note. you should recognize gain or loss equal to the difference between the amount realized on the sale or exchange and your tax basis in the Note. which should equal the amount you paid to acquire the Note. Your gain or loss should generally be exchange gain or loss that is taxable as ordinary income or loss for U.S. federal income tax purposes. unless an election under Section 988 of the Internal Revenue Code of 1986. as amended (the "Code") is available and made to treat such gain or loss as capital gain or loss ("Section 988 election"). The Section 988 election is generally available for a forward contract. a futures contract. or option on foreign currencies as described in Section 988 of the Code. Although not clear. a U.S. Holder (as defined in the accompanying prospectus supplement) may be entitled to make a Section 988 election with respect to the Notes. If a Section 988 election is available in respect of the Notes, in order for the election to be valid, a U.S. Holder must: (A) make the Section 988 election by clearly identifying the investment in the Notes on its books and records on the date the holder acquires the Notes as being subject to the Section 988 election (although no specific language or account is necessary for identifying a transaction on the holder's books and records. the method of identification must be consistently applied and must clearly identify the pertinent transaction as subject to the Section 988 election): and (B) verify the election by attaching a statement to the holder's income tax return, which must include (i) a description and the date of the Section 988 election. (ii) a statement that the Section 988 election was made before the close of the date that the Notes were acquired, (iii) a description of the Notes and the maturity date of the Notes or. alternatively, the date on which the Notes were sold or exchanged. (iv) a statement that the Notes were never pan of a "straddle" as defined in Section 1092 of the Code, and (v) a statement that all transactions subject to the Section 988 election are included on the statement attached to the holder's income tax return. If a Section 988 election is available and validly made in respect of the Notes. gain or loss recognized upon the sale or exchange of the Notes should be treated as capital gain or loss. Capital gain recognized by an individual U.S. Holder is generally taxed at preferential rates where the property is held for more than one year and is generally taxed at ordinary income rates where the property is held for one year or less. The deductibility of capital losses is subject to limitations. Prospective investors should consult their tax advisors regarding the availability. applicable procedures and requirements. and consequences of making a Section 988 election in respect of the Notes. Due to the absence of authorities that directly address the proper characterization of the Notes. no assurance can be given that the Internal Revenue Service (the "IRS") will accept. or that a court will uphold. this characterization and tax treatment of the Notes. in which case the timing and character of any income or loss on the Notes could be significantly and adversely affected. For example. the Notes could be treated either as "foreign currency contracts" within the meaning of Section 1256 of the Code or as "contingent payment debt instruments•-. as discussed in the section entitled "US. Federal Income Tax Considerations•• in the accompanying prospectus supplement. In 2007. the IRS released a revenue ruling holding that a financial instrument with some arguable similarity to the Notes is properly treated as a debt instrument denominated in a foreign currency. The Notes are distinguishable in meaningful respects from the instruments described in the revenue ruling. If. however. the reach of the revenue ruling were to be extended. it could materially and adversely affect the tax consequences of an investment in the Notes for U.S. Holders. possibly with retroactive effect. Withholding and reporting requirements under the legislation enacted on March 18. 2010 (as discussed beginning on page S-48 of the prospectus supplement) will generally apply to payments made after December 31. 2013. However. this withholding tax will not be imposed on payments pursuant to obligations outstanding on January 1. 2014. Holders arc -4- http://www.sec.gov/Archives/edgar/data/83246/000114420413015558/v338382_424b2.htm 10/29/2013 EFTA01140709  Page 6 of 11 urged to consult with their own tax advisors regarding the possible implications of this recently enacted legislation on their investment in the Notes. For a discussion of the U.S. federal income tax consequences of your investment in a Note. please see the discussion under - U.S. Federal Income Tax Considerations" in the accompanying prospectus supplement. Selected Risk Considerations An investment in the Notes involves significant risks. Investing in the Notes is not equivalent to investing directly in the Reference Currency. These risks are explained in more detail in the "Risk Factors" section of the accompanying prospectus supplement. • SUITABILITY OF THE NOTES FOR INVESThIENT - You should only reach a decision to invest in the Notes after carefully considering. with your advisors. the suitability of the Notes in light of your investment objectives and the information set out in this pricing supplement. Neither HSBC nor any dealer participating in the offering makes any recommendation as to the suitability of the Notes for investment. • THE AMOUNT PAYABLE ON THE NOTES IS NOT LINKED TO THE SPOT RATE OF THE REFERENCE CURRENCT AT ANY TIME OTHER THAN ON THE FINAL VALUATION DATE - The Final Spot Rate will be based on the Spot Rate of the Reference Currency on the Final Valuation Date. subject to postponement and certain market disruption events. Even if the Spot Rate of the Reference Currcncy appreciates prior to the Final Valuation Date but then drops on the Final Valuation Date to a level that is below the Barrier Level. the Payment at Maturity will be less. and may be significantly less. than it would have been had the Payment at Maturity• been linked to the Spot Rate of the Reference Currency prior to such drop. Although the actual Spot Rate of the Reference Currency on the Maturity Date or at other times during the term of the Notes may be higher than the Final Spot Rate. the Payment at Maturity will be based solely on the Final Spot Rate on the Final Valuation Date. • YOUR INVESTMENT IN THE NOTES MAY RESULT IN A LOSS - The Notes do not guarantee any return of principal. The return on the Notes at maturity is linked to the performance of the Reference Currency and will depend on the extent to which the Reference Currency appreciates or depreciates. If the Reference Currency has depreciated against the U.S. Dollar. compared to the Initial Spot Rate. by more than 15%. then the benefit provided by the Barrier Level will terminate. IN THAT SITUATION, YOU MAY LOSE UP TO 100% OF YOUR INVESTMENT. • THE MAXIMUM RETURN ON THE NOTES IS LIMITED — The payment on your Notes is limited to 51.285.00 for each 51.01)0 Principal Amount of Notes. This will be the case even if the Reference Currency has appreciated against the U.S. Dollar by more than 28.50%. • THE NOTES ARE SUBJECT TO THE CREDIT RISK OF HSBC USA INC. - The Notes arc senior unsecured debt obligations of the Issuer. HSBC. and are not, either directly or indirectly. an obligation of any third party. As further described in the accompanying prospectus supplement and prospectus. the Notes will rank on par with all of the other unsecured and unsubordinated debt obligations of HSBC. except such obligations as may be preferred by operation of law. Any payment to be made on the Notes. including any return of principal at maturity. depends on the ability of HSBC to satisfy its obligations as they come due. As a result, the actual and perceived creditworthiness of HSBC may affect the market value of the Notes and. in the event HSBC were to default on its obligations, you may not receive the amounts owed to you under the terms of the Notes. • INVESTING IN THE NOTES IS NOT EQUIVALENT TO INVESTING DIRECTLY IN THE REFERENCE CURRENCY — You may receive a lower return than you would have received if you had invested directly in the Reference Currency. The Reference Currency Return is dependent solely on the formula set forth above and not on any other formula that could be used for calculating currency performances. As such. the Reference Currency Return may be materially different from the return on a direct investment in the Reference Currency. • CURRENCY MARKETS MAY BE VOLATILE - Currency markets may be highly volatile. Significant changes. including changes in liquidity and prices. can occur in such markets within very short periods of time. Foreign currency rate risks include. but are not limited to, convertibility• risk and market volatility and potential interference by foreign governments through regulation of local markets, foreign investment or particular transactions in foreign currency. These factors may affect the value of the Reference Currency on the Final Valuation Date. and therefore. the value of your Notes. • LEGAL AND REGULATORY RISKS - Legal and regulatory changes could adversely affect exchange rates. In addition. many governmental agencies and regulatory organizations arc authorized to take extraordinary actions in the event of market emergencies. It is not possible to predict the effect of any future legal or regulatory action relating to exchange rates. but any such action could cause unexpected volatility and instability in currency markets with a substantial and adverse effect on the performance of the Reference Currency and, consequently. the value of the Notes. • IF THE LIQUIDITY OF THE REFERENCE CURRENCY IS LIMITED, THE VALUE OF THE NOTES WOULD LIKELY BE IMPAIRED - Currencies and derivatives contracts on currencies may be difficult to buy or sell, particularly during adverse market conditions. Reduced liquidity on the Final Valuation Date would likely have an adverse effect on the Final Spot Rate for the Reference Currency. and therefore. on the return of your Notes. Limited liquidity• relating to the http://www.sec.gov/Arehives/edgar/data/83246/000114420413015558/v338382_424b2.htm 10/29/2013 EFTA01140710  Page 7 of 11 Reference Currency may also result in HSBC USA Inc. or one of its affiliates. as Calculation Agent. being unable to determine the Reference Currency Return using its normal means. The resulting discretion by the Calculation Agent in determining the Reference Currency Return could. in turn. result in potential conflicts of interest • WE HAVE NO CONTROL OVER THE EXCHANGE RATE BETWEEN THE REFERENCE CURRENCY AND THE US. DOLLAR — Foreign exchange rates can either float or be fixed by sovereign governments. Exchange rates of the currencies used by most economically developed nations are permitted to fluctuate in value relative to the U.S. Dollar and to each other. However. fmm time to time. governments may use a variety of techniques. such as intervention by a central bank. the imposition of regulatory controls or taxes or changes in interest rates to influence the exchange rates of their currencies. Governments may also issue a new currency to replace an existing currency or alter the exchange rate or relative exchange characteristics by a devaluation or revaluation of a currency. These governmental actions could change or interfere with currency valuations and currency fluctuations that would otherwise occur in response to economic forces. as well as in response to the movement of currencies across borders. As a consequence. these government actions could adversely affect an investment in the Notes which are affected by the exchange rate between the Reference Currency and the U.S. Dollar. • THE PAYMENT FORMULA FOR THE NOTES WILL NOT TAKE INTO ACCOUNT ALL DEVELOPMENTS IN THE REFERENCE CURRENCY — Changes in the Reference Currency during the term of the Notes other than on the Final Valuation Date may not be reflected in the calculation of the Payment at Maturity. The Reference Currency Return will be calculated only as of the Final Valuation Date. As a result. the Reference Currency Return may be less than zero even if the Reference Currency had moved favorably at certain times during the term of the Notes before moving to an unfavorable level on the Final Valuation Date. • THE NOTES ARE SUBJECT TO EMERGING MARKETS' POLITICAL AND ECONOMIC RISKS — The Reference Currency is the currency of an emerging market country. Emerging market countries are more exposed to the risk of swift political change and economic downturns than their industrialized counterparts. In recent years. emerging markets have undergone significant political. economic and social change. Such far- reaching political changes have resulted in constitutional and social tensions, and. in some cases- instability and reaction against market reforms have occurred. With respect to any emerging or developing nation there is the possibility of naiionalization expmpriation or confiscation. political changes. government regulation and social instability. There can be no assurance that future political changes will not adversely affect the economic conditions of an emerging or developing-market nation. Political or economic instability is likely to have an adverse effect on the performance of the Reference Currcncy. and. consequently, the return on the Notes. • THE NOTES ARE SUBJECT TO CURRENCY EXCHANGE RISK — Foreign currency exchange rates vary over time. and may vary considerably during the term of the Noes. The relative values of the U.S. Dollar and the Reference Currency are at any moment a result of the supply and demand for such currencies. Changes in foreign currency exchange rates result over time from the interaction of many factors directly or indirectly affecting economic and political developments in other relevant countries. Of particular importance to currency exchange risk arc: • existing and expected rates of inflation: • existing and expected interest rate levels: • the balance of payments in the United States and Mexico between each country and its major trading partners: and • the extent of governmental surplus or deficit in the United States and Mexico. Each of these factors. among others. are sensitive to the monetary, fiscal and trade policies pursued by the United States, Mexico. and those of other countries important to international trade and finance. • NO INTEREST PAYMENTS — As a holder of the Notes. you will not receive interest payments. • POTENTIALLY INCONSISTENT RESEARCH, OPINIONS OR RECOMMENDATIONS BY HSBC AND JPMORGAN — HSBC. lliMorgan, or their respective affiliates may publish research. express opinions or provide recommendations that are inconsistent with investing in or holding the Notes and which may be revised at any time. Any such research. opinions or recommendations could affect the exchange rate between the Reference Currency and the U.S. Dollar, and therefore. the market value of the Notes. • CERTAIN BUILT-IN COSTS ARE LIKELY TO ADVERSELY AFFECT THE VALUE OF THE NOTES PRIOR TO MATURITY — While the Payment at Maturity described in this pricing supplement is based on the full Principal Amount of your Notes. the original issue price of the Notes includes the placement agent's commission and the estimated cost of hedging our obligations under the Notes through one or more of our affiliates. As a result. the price- if any. at which HSBC Securities (USA) Inc. will be willing to purchase Notes from you in secondary market transactions. if at all. will likely be lower than the original issue price. and any sale of Notes by you prior to the Maturity Date could result in a substantial toss to you. The Notes are not designed to be short-term trading instruments. Accordingly. you should be able and willing to hold your Notes to maturity. • THE NOTES LACK LIQUIDITY — The Notes will not be listed on any securities exchange. HSBC Securities (USA) Inc. may offer to purchase the Notes in the secondary market However. it is not required to do so and may cease making http://www.sec.gov/Arehives/edgar/data/83246/000114420413015558/v338382_424b2.htm 10/29/2013 EFTA01140711  Page 8 of 11 such offers at any time if at all. Because other dealers are not likely to make a secondary market for the Notes. the price at which you may be able to trade your Notes is likely to depend on the price. if any. at which HSBC Securities (USA) Inc. is willing to buy the Notes. Even if there is a secondary market, it may not provide enough liquidity to allow you to trade or sell the Notes easily. • POTENTIAL CONFLICTS — HSBC and its affiliates play a variety of roles in connection with the issuance of the Notes. including acting as Calculation Agent and hedging its obligations under the Notes. In performing these duties. the economic interests of the Calculation Agent and other affiliates of HSBC are potentially adverse to your interests as an investor in the Notes. The Initial Spot Rate for the Reference Currency is an intra-day level on the Pricing Date that has been determined by the Calculation Agent. Although the Calculation Agent has made all determinations and taken all actions in relation to the establishment of the Initial Spot Rate in good faith. it should he noted that such discretion could have an impact (positive or negative) on the value of your Notes. HSBC and the Calculation Agent are under no obligation to consider your interests as a holder of the Notes in taking any corporate actions or other actions, including the determination of the Initial Spot Rate. that might affect the Reference Currency and the value of your Notes. • THE NOTES ARE NOT INSURED OR GUARANTEED BY ANY GOVERNMENTAL AGENCY OF THE UNITED STATES OR ANY OTHER JURISDICTION — The Notes are not deposit liabilities or other obligations of a bank and arc not insured or guaranteed by the Federal Deposit Insurance Corporation or any other governmental agency or program of the United States or any other jurisdiction. An investment in the Notes is subject to the credit risk of HSBC. and in the event that HSBC is unable to pay its obligations as they become due. you may not receive the full Payment at Maturity of the Notes. • HISTORICAL PERFORMANCE OF THE REFERENCE CURRENCY SHOULD NOT BE TAKEN AS AN INDICATION OF THE FUTURE PERFORMANCE OF THE REFERENCE CURRENCY DURING THE TERM OF THE NOTES — It is impossible to predict whether the Spot Rate for the Reference Currency will rise or fall. The Reference Currency will be influenced by complex and interrelated political. economic, financial and other factors. • MARKET DISRUPTIONS MAY ADVERSELY AFFECT YOUR RETURN — The Calculation Agent may. in its sole discretion. determine that the markets have been affected in a manner that prevents it from determining the Reference Currency Return in the manner described herein. and calculating the amount that we arc required to pay you upon maturity. or from properly hedging its obligations under the Notes. These events may include disruptions or suspensions of trading in the markets as a whole or general inconvertibility or non-transferability of one or more currencies. II the Calculation Agent. in its sole discretion. determines that any of these events prevents us or any of our affiliates from properly hedging our obligations under the Notes or prevents the Calculation Agent fmm determining the Reference Currency Return or Payment at Maturity in the ordinary manner. the Calculation Agent will determine the Reference Currency Return or Payment at Maturity in good faith and in a commercially reasonable manner. and it is possible that the Final Valuation Date and the Maturity Date will be postponed. which may adversely affect the return on your Notes. For example. if the source for an exchange rate is not available on the Final Valuation Date. the Calculation Agent may determine the exchange rate for such date. and such determination may adversely affect the return on your Notes. • MANY ECONOMIC AND MARKET FACTORS WILL IMPACT THE VALUE OF THE NOTES — In addition to the Spot Rate of the Reference Currency on any day. the value of the Notes will be affected by a number of economic and market factors that may either offset or magnify each other. including: • the actual and expected exchange rates and volatility of the exchange rates between the Reference Currency and the U.S. Dollar: • the time to maturity of the Notes: • interest and yield rates in the market generally and in the markets of the Reference Currency and the U.S. Dollar: • a variety of economic. financial. political. regulatory or judicial events: and • our creditworthiness, including actual or anticipated downgrades in our credit ratings. http://www.sec.gov/Arehives/edgar/data/83246/000114420413015558/v338382_424b2.htm 10/29/2013 EFTA01140712  Page 9 of 11 What Is the Total Return on the Notes al Maturity Assuming a Range of Performances for the Reference Currency? The following table illustrates the hypothetical total return at maturity on the Notes. The "total return.' as used in this pricing supplement. is the number. expressed as a percentage. that results from comparing the Payment at Maturity per $1.000 Principal Amount of Notes to $1.000. The hypothetical total returns set forth below reflect the Bather Level of -15% and the Initial Spot Rate of 1.9619. The hypothetical total returns set forth below are for illustrative purposes only and may not be the actual total returns applicable to a purchaser of the Notes. The numbers appearing in the following table and examples have been rounded for case of analysis. Hypothetical Anal Spot Hypothetical Reference Hypothetical Total Return Rate Currency Return on the Notes 0.0000 100.00% 28.50% 0.3924 80.00% 28.50% 0.7848 60.00% 28.50% 0.9810 50.00% 28.50% 1.1771 40.00% 28.50% 1.3733 30.00% 28.50% 1.5695 20.00% 28.50% 1.6676 15.00% 28.50% 1.7657 10.00% 28.50% 3.50%a$096 1.9030 3.00% 5.00% 1.9227 2O0% 5.00% 0.009E 0.00% 2.0011 -2.00% 0.00% 2.0600 -5.00% 0.00% 2.1581 - I 0.00% 0.00% -15.00% 0.00% 2.3543 -20.00% -20.00% 2.4524 -25.00% -25.00% 2.5505 -30.00% -30.00% 2.7467 -40.00% -40.00% 2.9429 -50.00% -50.00% 3.1390 -60.00% -60.00% 3.5314 -80.00% -80.00% 3.9238 -100.00% -100.00% Hypothetical Examples of Amounts Payable at Maturity The following examples illustrate how the total returns set forth in the table above are calculated. Example 1: The Reference Currency depreciates from the Initial Spot Rate of 1.9619 to a hypothetical Final Spot Rate of 2.0600. Because the Reference Currency Return of -5.00% is greater than the Barrier Level of -15.00%. the investor receives a Payment at Maturity of $1.000 per $L0D0 Principal Amount of Notes. Example 2: The Reference Currency appreciates from the Initial Spot Rate of 1.9619 to a hypothetical Final Spot Rate of 1.9227. Because the Reference Currency Return of 2.00% is greater than 0.00% but less than 3.00%. the investor receiv