Currency Plus Term Deposit

HSBC Currency Plus Term Deposit is an effective investment tool to Premier customers who have with high FX currency needs as well as seek more diverse investment opportunity to establish sound wealth management portfolio.

• Customer Eligibility : All individuals
• Minimum Deposit Amount : Min. Deposit Amount: KRW 10,000,000 Equivalent
• Deposit Period : KRW - Min 1 month ~ Max 3 months / Foreign Currency - Min 7 days ~ Max 3 months
• Deposit Currency (Select Currency) : KRW, USD, EUR, JPY, HKD, NZD, AUD, GBP, CAD
• Counter Currency (Select Currency) : KRW, USD, EUR, JPY, HKD, NZD, AUD, GBP, CAD
• Select Currency Pair : Choice by customer when an account is opened
• Conversion FX Rate : Conversion FX rate will be fixed based on real-time market value at the time of account opening.
• Maturity FX Rate : Currency value between deposit and counter currency of maturity fixing date
  (usually 2 working days before maturity date).
• Interest Payment : Maturity Payments

• If customer early withdraws deposit before maturity, customer will be charged with premature withdrawal penalty caused by early redemption of option deal. This will cause loss to customer’s original deposit principal.
• Early withdrawal will be made in deposit currency.

• Currency conversion risk : In case of currency conversion at maturity, customers may receive their principal and interest in counter currency.
• Foreign exchange risk : In case of currency conversion, customers may be exposed to foreign exchange loss due to appreciation of deposit currency when customer decides to re-convert maturity payment back to deposit currency.
• This product is not protected by KDIC.
• In case of cash transaction related to foreign currency deposits (travelers’ cheque included); bank may charge cash commission or travelers’ cheque sales fee to customer based on internal FX guideline.

Step 1. Opening

• Customer chooses deposit currency, counter currency and deposit tenor.
• Decide on investment return and conversion FX rate according to the choice made by customer.
• Open an account.

Step 2. Working days before Maturity (Maturity Fixing Date)

Settle the maturity fixing FX rate following indicated rate between currency pairs in Reuter page. Customer’s maturity payment currency will be decided upon this rate as shown in below example:

• Case 1 :
  Deposit Currency Depreciation
  Interest calculation=Principal + (Principal ⅹ Investment return x No. of deposit days / No. of annual days)
  Currency Paid = Deposit Currency
• Case 2 :
  Deposit Currency Appreciation
  Interest Calculation=Principal + (Principal ⅹ Investment return x No. of deposit days / No. of annual days)
  Currency paid = Counter Currency

Step 3. Maturity day

• Principal and Interest paid.

Condition

• Deposit Currency : USD
• Counter Currency : KRW
• Deposit Tenor : 1 month
• Principal : USD100,000.00
• Spot FX Rate : 957
• Conversion FX Rate : 967
• Investment Return : 5.90%p.a (Before Tax)

Result Case #1- Deposit Currency Depreciation [In this example, if maturity fixing rate is less than Conversion Rate, i.e. USD/KRW = 966, 960 or less]

• Interest Calculation
  - Principal : USD 100,000
  - Interest : 100,000ⅹ5.90%ⅹ30/360 = 491.66
  - Principal and Interest : 100,000 + 491.66 = USD 100,491.66
• Deposit currency is depreciated therefore final amount is paid in deposit currency : USD 100,491.66

Result Case #2- Deposit Currency Appreciation [In this example, if maturity fixing rate is equal to or greater than Conversion Rate, i.e. USD/KRW = 967 or 970 or more]

• Interest Calculation
  - Principal : USD 100,000
  - Interest : 100,000ⅹ5.90%ⅹ30/360 = 491.66
  - Principal and Interest : 100,000 + 491.66 = USD100,491.66
• Deposit currency is appreciated therefore final amount is paid in counter currency :USD 100,491.66ⅹconversion FX rate (967) = KRW97,175,435

If you have any enquiries about the service provided by HSBC bank, please send us e-mail or if you want consultation about products, please call us on ☎ 1588-1770.