FX Linked Deposit - High Yield Deposit

Seize the potential for higher interest return
than ordinary time deposit

Important Notes:
-FX Linked Deposit - High Yield Deposit is a structured product involving derivatives. The investment decision is yours but you should not invest in FX Linked Deposit - High Yield Deposit unless the intermediary who sells it to you has explained to you that the product is suitable for you having regard to your financial situation, investment experience and investment objectives.
-FX Linked Deposit - High Yield Deposit is not equivalent to or an alternative of time deposits. It is not a protected deposit, and is not protected by the Deposit Protection Scheme in Hong Kong.

Accrue higher potential interest rates than you would from conventional time deposits when the movement in foreign exchange market matches your view.

  • Capture Higher Potential Return

  • Higher Potential Interest Income

  • Enjoy higher potential return than conventional time deposits.

  • Opportunity to Exchange Foreign Currencies at More Favorable Rates

  • Get a chance to exchange foreign currencies at deposit maturity at more favorable rates than the current spot rates to meet your foreign currency needs.

  • A Wide Variety of Currencies for Selection

  • Choose from 10 currencies - AUD, CAD, CHF, EUR, GBP, HKD, JPY, NZD, USD and CNH to form almost 40 combinations of currency pairs.

  • Initial Exchange Rate at Your Discretion

  • Customize the "Initial Exchange Rate" according to your investment need. It can be above, equal to or below the current spot rate.

  • Tenor at Your Choice

  • Set the investment tenor according to your view and need. It can be as short as 1 week or as long as 1 year.

  • No Fees or Charges

  • Invest without any fees or charges to maximize your return.

  • Multiple Trading Channels

  • To place a deposit, visit any of our branches or logon to Online Banking. You may also contact your relationship manager.

  • Open an Account and Trade Online Anytime

  • Open an FX Linked Deposit Account and trade anytime via Online Banking Set up an eAlert and you will be notified of your FX Linked Deposit fixing exchange rate via SMS and/or email on maturity date.

  • Product Structure

  • If the Linked Currency appreciates against the Deposit Currency or if the Fixing Exchange Rate is equal to the Initial Exchange Rate, you will get back the principal amount plus the interest amount in the original Deposit Currency on the maturity date.

  • Conversely, if the Linked Currency deprecates against Deposit Currency, you will get back the principal amount plus the interest amount in the Linked Currency (using the Initial Exchange Rate).

Product Structure

The picture above is not drawn to scale.

The above product is bound by the related terms and conditions. Please contact our staff for details.

Risk Disclosure
Investment involves risks. The prices of investment products fluctuate, sometimes dramatically, and may become valueless. Investors should not invest based on this web page alone. Before making any investment decisions, customers must consult their own independent financial advisors and read the relevant offering documents for further details including the risk factors in order to ensure that they fully understand the risks associated with the investment products.

FX Linked Deposit ("FXLD")
The FXLD is an unlisted investment product and subject to the credit and insolvency risks of the Bank. Its return is limited to the interest payable, which will be dependent on movements in some linked exchange rate. Whilst the possible return may be higher than conventional time deposits, it is normally associated with higher risks. Exchange rates are affected by a wide range of factors, including international finance, economics, politics, central banks and other bodies' intervention and natural events, and may rise or fall rapidly. The FXLD is not principal-protected and is not the same as directly buying the currencies of the currency pair. It is not protected by the Investor Compensation Fund. If the FXLD is approved by the Bank to be withdrawn before its maturity, the customer may also need to bear the costs involved which may reduce the return and the principal amount of the FXLD he may get back. There is no secondary market for the FXLD and it is not collateralized. The Bank can early terminate the FXLD.

Disclaimer
This web page does not constitute advice to buy or sell, or an offer with respect to any investment products. This web page and the FX Linked Deposit abovementioned are issued by China Construction Bank (Asia) Corporation Limited which is a licensed bank regulated by the Hong Kong Monetary Authority. This web page has not been reviewed by any regulatory authorities in Hong Kong.

Disclaimer of Online Investment Trading Services

  • High Yield Deposit

  • High Yield Deposit is an FX Linked Deposit in which you will get back the principal and receive interest:

  • in the Deposit Currency if the Linked Currency is stay put or even appreciate against the Deposit Currency with respect to the Initial Exchange Rate at a pre-determined time ("Fixing Time") on a pre-determined date ("Fixing Date"); or

  • in the Linked Currency if the Linked Currency depreciate against Deposit Currency with respect to the Initial Exchange Rate at the Fixing Time on the Fixing Date where the principal and the interest are converted to the linked currency at the pre-determined Initial Exchange Rate.

Customer's View: Expect AUD/USD to trade at or above 0.7805 after 1 month (bullish on AUD)
Deposit Currency: USD
Linked Currency: AUD
Currency Pair: AUD/USD
Principal Amount: USD100,000
Deposit Period: 1 month
Initial Exchange Rate: 0.7805
Interest Rate: 6% per annum

The investment return depends on the AUD/USD spot exchange rate at the Fixing Time on the Fixing Date ("Fixing Exchange Rate"):

Fixing Exchange Rate Payoff at Maturity Deposit Currency Equivalent Payoff* Profit and Loss against
The Principal
BEST The exchange rate moves along with Customer’s View.
0.8805 Principal + Interest
=USD100,000 + USD500
=USD100,500
USD100,500 USD500
MIDDLE The exchange rate moves along with Customer’s View.
0.7785 (Principal + Interest) /initial Exchange Rate
=(USD100,000 + USD500)/0.7805
=AUD128,764
AUD128,764 x 0.7785
=USD100,243
USD243
LOSS The exchange rate moves against with Customer’s View.
0.7605 (Principal + Interest) /initial Exchange Rate
=(USD100,000 + USD500)/0.7805
=AUD128,764
AUD128,764 x 0.7605
=USD97,925
USD2,075
WORST The exchange rate moves against with Customer’s View.
0 (Principal + Interest) /initial Exchange Rate
=(USD100,000 + USD500)/0.7805
=AUD128,764
AUD128,764 x 0
=USD0
USD100,000

* The Deposit Currency equivalent payoff is calculated by converting the principal and interest in the linked currency to the deposit currency at the Fixing Exchange Rate. It is effectively the payoff received by the customer if the amount is converted to the Deposit Currency from the Linked Currency at the Fixing Exchange Rate, if applicable.

Payoff Diagram

payoff diagram

If the bank becomes insolvent or defaults on its obligations, the customer may get nothing back and suffer a total loss of the Principal Amount.

In addition to the movement of the Linked Currency, if the customer's home currency is not the Deposit Currency, the customer's total realized gain or loss (in terms of the home currency) will also depend on the fluctuation of the exchange rate between the Deposit Currency and the customer's home currency. If the Deposit Currency depreciates against the customer's home currency, the potential loss arising from such exchange rate movement may offset (or even exceed) the potential return received from the product. To the extreme, if the Deposit Currency becomes valueless on the Maturity Date, then the customer will still suffer total loss (i.e. 100% loss) when the customer converts the maturity proceeds back to the customer's home currency on the Maturity Date. Conversely, if the Deposit Currency appreciates against the customer's home currency, the potential profit arising from such exchange rate movement may enhance the customer's total realized return.

Taking the Best Case Scenario above where the total payoff customer receives at maturity is USD100,500, assuming that HKD is customer's home currency and he/she chooses to convert the payoff back to HKD at maturity, the customer total realized gain/loss of this investment is shown below:
Scenario Exchange rate of USD/HKD on Trade Date Exchange rate of USD/HKD on maturity date Total payoff on the maturity date (USD) Total payoff on the maturity date (HKD equivalent) Gain or Loss against the Principal Amount calculated in HKD (Actual %)
1.1 7.75 7.80 USD100,500 HK$783,900 1.15%
1.2 7.75 7.69 USD100,500 HK$772,845 -0.28%
1.3 7.75 0.00 USD100,500 HK$0.00 -100%

View the Important Facts^ to learn more about the product.

The hypothetical cases above are for illustration only and are not indicative of the actual performance of the relevant products.

The above product is bound by the related terms and conditions. Please contact our staff for details.

^ You need to have the latest version of Adobe Reader to view the file. The software can be downloaded from http://www.adobe.com If you wish to obtain a printed copy, please visit our branches or contact your Relationship Managers.

Risk Disclosure
Investment involves risks. The prices of investment products fluctuate, sometimes dramatically, and may become valueless. Investors should not invest based on this web page alone. Before making any investment decisions, customers must consult their own independent financial advisors and read the relevant offering documents for further details including the risk factors in order to ensure that they fully understand the risks associated with the investment products.

FX Linked Deposit ("FXLD")
The FXLD is an unlisted investment product and subject to the credit and insolvency risks of the Bank. Its return is limited to the interest payable, which will be dependent on movements in some linked exchange rate. Whilst the possible return may be higher than conventional time deposits, it is normally associated with higher risks. Exchange rates are affected by a wide range of factors, including international finance, economics, politics, central banks and other bodies' intervention and natural events, and may rise or fall rapidly. The FXLD is not principal-protected and is not the same as directly buying the currencies of the currency pair. It is not protected by the Investor Compensation Fund. If the FXLD is approved by the Bank to be withdrawn before its maturity, the customer may also need to bear the costs involved which may reduce the return and the principal amount of the FXLD he may get back. There is no secondary market for the FXLD and it is not collateralized. The Bank can early terminate the FXLD.

Disclaimer
This web page does not constitute advice to buy or sell, or an offer with respect to any investment products. This web page and the High Yield Deposit abovementioned are issued by China Construction Bank (Asia) Corporation Limited which is a licensed bank regulated by the Hong Kong Monetary Authority. This web page has not been reviewed by any regulatory authorities in Hong Kong.

Disclaimer of Online Investment Trading Services

  • Key Risks

  • Not a time deposit

  • FX Linked Deposit - High Yield Deposit is NOT equivalent to, nor should it be treated as a substitute for, time deposits. It is NOT a protected deposit and is NOT protected by the Deposit Protection Scheme in Hong Kong.

  • Derivatives risk

  • FX Linked Deposit - High Yield Deposit is embedded with FX options. Option transactions involve risks, especially when selling an option. Although the premium received from selling an option is fixed, you may sustain a loss well in excess of such premium amount, and your loss could be substantial.

  • Limited potential gain

  • The maximum potential gain of this product is limited to the nominal interest calculated at the Interest Rate percentage

  • Maximum potential loss

  • FX Linked Deposit - High Yield Deposit is not principal protected: you could lose all of your principal amount.

  • Not the same as buying the linked currency

  • Investing in FX Linked Deposit - High Yield Deposit is not the same as buying the linked currency directly.

  • According to the fixing result made on the fixing date, the customer will get back the principal amount plus the interest in either the deposit currency or the linked currency on the maturity date.

  • Market risk

  • The return on FX Linked Deposit – High Yield Deposit is limited to the nominal interest payable, which will be dependent, to at least some extent, on movements in some specified currency exchange rate. Whilst the possible return may be higher than conventional time deposits, it is normally associated with higher risks. When the fluctuation of the currency exchange rates differs from what the customer expected, the customer may have to bear the consequential loss.

  • Currency exchange rates are affected by a wide range of factors, including national and international financial and economic conditions and political and natural events. The effect of normal market forces may at times be countered by intervention by central banks and other bodies. At times, exchange rates, and prices linked to such rates, may rise or fall rapidly.

  • Exchange controls or other monetary measures may be imposed by a government, sometimes with little or no warning. Such measures may have a significant effect on the convertibility or transferability of a currency and may have unexpected consequences for a FX Linked Deposit – High Yield Deposit.

  • Liquidity risk

  • FX Linked Deposit - High Yield Deposit is designed to be held till maturity. You do not have a right to request early termination of this product before maturity. This product is unlisted and there is no secondary market.

  • Credit and insolvency risk of the Bank

  • The Bank is acting as the principal of this investment product.

  • This product is not collateralized. When you invest in this product, you will be relying on the Bank's creditworthiness. If the Bank becomes insolvent or defaults on its obligations under this product, you can only claim as an unsecured creditor of the Bank. In the worst case, you could suffer a total loss of your principal amount.

  • Currency risk

  • In relation to a FX Linked Deposit – High Yield Deposit, the Principal Amount itself may be subject to variation by reference to the relevant currency exchange rate or may be repaid in a different currency. The total return on a FX Linked Deposit – High Yield Deposit may be negative (when measured in terms of the Deposit Currency), and, depending on the particular terms of a FX Linked Deposit – High Yield Deposit, the value of the principal repayable on Maturity Date may be significantly less than the value deposited, in the event of an adverse movement in the relevant exchange rate. If the deposit currency and/or the linked currency is not in your home currency, and you choose to convert it back to your home currency upon maturity, you may make a gain or loss due to exchange rate fluctuations even you receive the interest from this product.

  • Risk of early termination by the Bank

  • The Bank has the right (but not the obligation) to terminate this product early upon occurrence of certain events. If this product is terminated by the Bank early, your return of this product might be negatively affected.

  • Not covered by the Investor Compensation Fund

  • This product is not covered by the Investor Compensation Fund.

Disclaimer
This web page does not constitute advice to buy or sell, or an offer with respect to any investment products. This web page and the Principal Protected Deposit abovementioned are issued by China Construction Bank (Asia) Corporation Limited which is a licensed bank regulated by the Hong Kong Monetary Authority. This web page has not been reviewed by any regulatory authorities in Hong Kong.

Disclaimer of Online Investment Trading Services