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 Risk Factors |
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Investors should note that all investments including placing Hang Seng MaxiInterest Investment Deposit (Mainland China) (“Deposit”) involve risk.
Investors should be aware that this Deposit is a high risk investment product. It is different from normal time deposit and thus should be not considered as normal time deposit or its alternative. Earnings on this Deposit are limited to the nominal interest payable and option premium payable. As this Deposit and its earnings thereon will be paid in the Deposit Currency or the Linked Currency, whichever has depreciated against the other, the investor will have to bear the potential losses due to depreciation and which may be substantial. Such losses may offset the earnings of this Deposit and may even result in loss of principal.
If the Deposit is withdrawn before maturity, the investor will also have to bear the costs involved. Such losses and costs may reduce the earnings and the Principal Amount of this Deposit. Investors should seek professional advice where necessary. Investors should consider and fully understand the following risks and read the other information contained in the relevant Terms and Conditions before making any investment decision.
As the Deposit has its pre-determined investment period, investors should consider their need to maintain sufficient liquid assets during the relevant investment period (especially when the investment period is long) and satisfy themselves that the Deposit is suitable for them in view of their own circumstances and financial position before making any investment decision.
Investors should avoid excessive investment (in terms of its proportion of the overall portfolio) in any single type of investment, so as to avoid the investment portfolio being over-exposed to any particular investment risk.
| Risks associated with Returns |
| Risk in loss of principal |
This Deposit is not a capital protected product, thus investors will not obtain any guarantee that he can receive the principal that he initially places for the Deposit upon maturity. If the movement of the exchange rate is different from the view taken by the investors, investors may suffer a loss in the principal.
| Receiving Nominal Interest and Option Premium at Maturity |
Investors should understand that earnings on the Deposit are limited to the nominal interest and option premium payable. The nominal interest and option premium are only payable upon maturity. No periodic income will be payable to investors prior to the maturity.
| Market Risks associated with Redemption Amount |
When this Deposit matures, investors will receive the principal, nominal interest and option premium of the Deposit (together, “Redemption Amount”). Upon maturity, the Bank will compare the prevailing exchange rate with the Initial Exchange Rate as initially agreed to determine the currency in which the Redemption Amount will be paid to investors. If the Linked Currency has depreciated against the Deposit Currency upon maturity, the Redemption Amount will be converted into the Linked Currency at the Initial Exchange Rate and paid to investors in the Linked Currency. Therefore, investors should bear the potential loss due to depreciation. Such loss may offset the interest and option premium earned on the Deposit and may even result in losses in the principal amount of the Deposit. Investors should be fully aware of the risks relating to fluctuations in the exchange rates. Factors affecting the performance of foreign exchange markets are numerous, including but are not limited to changes in global and local investment sentiments, interest rate policies, fund flows, political environment, economic environment, business and social conditions in the local marketplace. If the trend of the market is different from the view taken by the investor, the total returns payable to the investor at maturity will be less than that would have been payable on a time deposit for the same tenor, and the investor may even incur a loss.
If the Deposit Currency used for placing the Deposit is not the local currency customarily used by investors and thus conversion is required, investors should note that they may make a gain or suffer a loss due to exchange rate fluctuations.
Early withdrawal of the Deposit by investors is not allowed and the capital of the investors will be invested in the Deposit for the entire investment period. The Bank may at its absolute discretion accept or refuse any early withdrawal request. If the Bank allows the Deposit to be withdrawn prior to the Maturity Date, the Bank shall be entitled to deduct any costs, losses and damages which are incurred by the Bank and its affiliates, using its reasonable efforts, in discharging any such related hedge or other arrangement from the Principal Amount or other amounts (if any) in relation to the Deposit which are otherwise payable to investors. Therefore, the amount received by the investor upon early withdrawal may be less than the amount invested. In the event that such Principal Amount or other amounts (if any) are insufficient to indemnify or reimburse the Bank in respect of such costs, losses and damages, the Bank shall be entitled to claim from the investor the amount of the remaining costs, losses and damages and to exercise its rights of set-off under the terms and conditions of the Deposit or otherwise in respect of any other sums due from the Bank or its affiliates to the investor in respect of the Deposit or otherwise.
This Deposit is offered by Hang Seng Bank Limited, and subject to Hang Seng MaxiInterest Investment Deposit (Mainland China) Terms and Conditions (available upon request).
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