HSBC Special Foreign Investment Deposit Account (SIFDA)

The HSBC Special Foreign Investment Deposit Account option offers you the potential to earn significantly higher returns on your savings and deposits using a wide array of currencies.

We help partner over 50 million people worldwide in managing all their needs related to their investment portfolios. When it comes to making the right choice for your investment, our global strength and stability, together with better returns is hard to match.

Features

• Non-Residents and Non-Nationals now have the ability to invest in Sri Lankan Rupees or any other designated foreign currency deposits and get the benefit of high interest rates.
• Upon maturity, the investment can be converted back to the currency of origin at the prevailing exchange rate and be repatriated.
• Credits to account - Proceeds of inward remittances received from abroad through a recognised banking system or Foreign Currency in the form of travelers' cheques, bank drafts or currency notes brought into the country after declaration to Sri Lanka Customs.
• Withdrawals - Outward remittances and transfers to self named SFIDAs are allowed. Funds in SFIDAs could be remitted out of Sri Lanka under established guidelines with no prior approval from Central Bank of Sri Lanka.
• Transfer of funds between SFIDA of a non resident & account maintained in offshore units in Sri Lanka by such non residents.

Benefits

• Enhanced investment returns with attractive Sri Lankan Rupee / Foreign currency deposit rates (Indicative rates mentioned below).
• Transfers between SFIDAs are permitted under same customer name.
• At maturity, your investment can be converted to any of the designated currencies of your choice (mentioned below), at the prevailing exchange rate.
• Keep track of your accounts by using Personal Internet Banking from HSBC.

Treasury bonds/ Treasury bills

Treasury Bonds / Bills offer you potentially higher returns with stable income.

Treasury bonds

Treasury bonds are long-term negotiable instruments issued by the Central Bank of Sri Lanka (CBSL) on behalf of the government ranging from 2 to 20 years. A Treasury bond's features are different to that of a Treasury bill. Treasury bonds carry a coupon (expressed as a percentage of the face value at the time of issuing), which is paid semi-annually. The interest rate the investor would receive depends on the current market rates. The market rate might be higher or lower in comparison to the coupon rate. If the market rate is higher than the coupon interest rate, the price (investment value) the investor will be paying will be lower than the face value.

Treasury bill

Treasury bills are short-term negotiable instruments issued by the Central Bank of Sri Lanka (CBSL) on behalf of the government with a term of one year or less. Treasury bills are sold at a discount from face value and don't pay interest before/at maturity. The interest is the difference between the purchase price of the bill and the amount that is paid to you at maturity (this amount is the face value). At present CBSL issues 3, 6, and 12 month tenors at the auction.

The mandatory requirements to invest in Treasury Bills / Bonds through HSBC are;

- Opening an account with the Central Depository System (CDS)
- Provide standard settlement instruction form
- Master repurchase agreement (for renewals in repos) through us

Note: The price of bonds can and does fluctuate, and any individual bond may experience upward or downward movements. There is an inherent risk that losses may be incurred rather than profits made as a result of buying and selling bonds.

The holder of bonds bears the credit risk of the issuer and has no resource to HSBC unless the latter itself is the issuer.

Re-purchase agreement (REPOs)

A Repo has a dual security feature, where the investor assumes the credit risk of HSBC and the underlying security. The duration between 1 day to the maturity of the Treasury bill/bond. For the investor it offers flexibility, particularly if the investment period is very short-term.

You can invest up to a maximum duration of 12 months with HSBC in Repurchase Agreements.

*Subject to availability

Local Insight. Global Expertise

Receive up-to-the-minute information and monthly updates on global and local markets.

Disclaimer

The information provided is intended as a general guide for reference. Benefits and features may be subject to local country regulatory restrictions. Please refer to the Premier Service guide.

Need more information?

For further information, please talk to your Relationship Manager, call our Customer Service Centre on 4 4722 72 or stop by at your nearest Branch. You could also contact us via e-mail wealthmanagementdeskcbh@hsbc.com.lk