HSBC Bank (Vietnam) Ltd launches dual currency deposits

On 11 May 2010, HSBC Bank (Vietnam) Ltd (“HSBC Vietnam”) launched a new tranche of Dual Currency Deposits (DCDs) – foreign currency linked deposits that offer potentially higher interest rates in comparison to traditional foreign currency time deposits. HSBC is the first bank to offer this product in Vietnam

DCDs are the ideal deposit accounts for customers who seek to earn potentially higher interest by taking advantage of exchange rate movements. In exchange for enhanced returns, customers agree to give HSBC the right to pay the initial deposit in either the base currency or linked currency at maturity.

For this tranche, dual currencies are US dollar ($) and Australian dollar (AU$) respectively. If, on the fixing day, the AU$/US$ exchange rate is at or above the conversion rate on the start day, the principal and interest will be paid in US dollar. Otherwise, the principal will be paid in Australian dollar and the interest in US dollar.

“DCDs benefit customers who are happy to accept a medium level of investment risk to potentially earn higher returns on their deposits,” said Lyndsay Rajah, Head of Personal Financial Services for HSBC. “DCDs can also be used as an allocation tool for customers who want to diversify their currency portfolio; for instance, if they have children studying overseas in the linked currency country.”

DCDs require a minimum deposit of $5,000 for a three month tenor, with no premature withdrawal allowed. When applying for DCDs, customers first agree upon a deposit amount; base currency and linked currency (non-Vietnamese dong); tenor, including start, fixing and maturity date; conversion rate; minimum rate of return; and related terms and conditions with HSBC.

Press Release

Tags: HSBC Bank Vietnam, vietnam bank, Vietnam finance, Vietnam financial