Certificates of Deposit

How it works

Coupon and Annualised Yield

The coupon is the rate of interest payable by the bank on the relevant CD, based on its issued value and is usually expressed as an annual percentage. However as CDs can fluctuate in value before maturity, the annualised yield best describes the total amount that will be earned in one year from investing in any given CD.

Currency Choices

Apart from the Hong Kong dollar, there are CDs available in a wide range of currencies, including the Australian dollar, Canadian dollar, Euro, Pound sterling and US dollar.

Redemption Guarentee

CDs offer a comparatively safer way of fixing the return and the term of your investment. The principal capital is returned in full at redemption on maturity or if the CD is "called" ** earlier by HSBC.

Liquidity

HSBC endeavours, but has no obligation, to maintain a secondary market in which you may sell your HSBC CD prior to its maturity date. However during the term of the CD its value will fluctuate, as interest rates move in the market. Your principal is not guaranteed if you redeem it before maturity.

Covenient and Flexible

HSBC does, but has no obligation to, maintain a secondary market in the CDs it issues, allowing you more choice when it comes to investing in a CD***. In addition, depending on market conditions, new issues are made available, which may be subscribed to during the offer period. Our designated branches offer you both of these options, Premier customers can also perform transactions via the telephone and all HSBC customers can apply for new issues via our online IPO Centre.

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Charges

We'll waive all charges for purchasing or selling CDs, interest collection, and redemption at maturity.

**Certain CDs are made available by HSBC with additional provisions, which allow the bank to force you to redeem the CDs earlier than the original maturity date, at which point interest is no longer paid on the issue. If you are unsure of how these provisions may affect you please consider discussing them with your Investment Advisor.
***The buying price may differ from the original selling price due to changes in market conditions. However, please note that we do not offer receipt and delivery service.
****For HSBC Premier, PowerVantage and SmartVantage customers, the fee is payable in June and December every year. For general securities account customers, the fee is payable on a half-yearly basis from the opening date of their securities account. The fee is calculated on an accumulative basis based on the average.

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