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Product Name
Foreign Exchange Swap
Product Description
Foreign Exchange Swap - a pair of currency transactions, one currency is exchanged for another for an agreed time period. One purchase, one sale, for 2 different value dates, one of which is spot or forward, the other is forward. The cash flow for swap transaction occurs at the beginning of the trade and at the maturity of far leg. FX swap is a useful instrument to hedge both exchange rate and interest rate risks. A swap deal can be seen as FX transactions composed with a spot and a forward.
Product Features
Foreign exchange swap transaction allows clients to hedge against exchange rate and interest rate risk while the same time minimising the cost of foreign currency exchange. It allows customers to effectively control market risk as well as matching the future cash flows of foreign currency assets or liabilities to meet business needs.
Eligible Applicants
1. Suitable for corporate customers or individual clients need to effectively lock in exchange rates and interest rates.
2. Corporate customers usually need to open a bank account with us before they can trade with our FX trader through their relationship managers.
3. Individual customers usually need to open a bank account and apply at the counter.
Application Requirements
Dependent on currency and the current regime
We can trade with corporate customers or interbank clients by credit line limits. Clients who can fulfil the credit assessment requirement of the bank will be given a respective swap limit to allow trade execution without the margin being paid in advance.
Application Procedures
1. Open accounts: Clients wish to trade FX swap should open a current account with us, in addition a margin account should also be opened.
2. Sign agreements: Customers must sign necessary agreements before they can trade FX swap.
3. Quotation: Customers submit a written authorisation to establish the details of FX swap deals.
4. Deal confirmation: Once the transaction is successful the bank will inform our customers the confirmed transaction in writing.
5. Settlement: Funds will be settled on the delivery dates for both near leg and far leg.
Gentle Reminder
1. The major currencies that we can provide for FX swap are: Australian Dollar (AUD), Canadian Dollar (CAD), Swiss Franc (CHF), Chinese Renminbi (CNY), Danish Krone (DKK), Euro (EUR), British Pound (GBP), Hong Kong Dollar (HKD), Hungarian Forint (HUF), Japanese Yen (JPY), Norwegian Krone (NOK), New Zealand Dollar (NZD), Polish Zloty (PLN), Swedish Krona (SEK), U.S. Dollar (USD), Singapore Dollar (SGD), Silver (XAG), Gold (XAU), South African Rand (ZAR), etc.
2. For corporate customers, please contact a relationship manager. For individual customers, please contact the branch.
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