Currency Linked Principal Guaranteed Deposit

Principal Guaranteed at Maturity Only – The principal guaranteed feature is only applicable if CLPGD is held to maturity.

Derivative Risk (Not applicable to CLPGD – Fixed Rate Series) – CLPGD is embedded with currency option(s). Option transactions involve risks. When you buy an option, the option value might become worthless if the market moves against your expectation.

Derivative Risk (Only applicable to CLPGD – Fixed Rate Series) – CLPGD – Fixed Rate Series is embedded with currency swap(s). Generally, swap transaction is subject to market risk, credit risk, liquidity risk, legal risk and settlement risk.

Not a Protected Deposit – CLPGD is not equivalent to time deposit and should not be regarded as a substitute for time deposit. CLPGD is not a protected deposit and is not protected by the Deposit Protection Scheme in Hong Kong.

Foreign Exchange Risk (Not applicable to CLPGD – Fixed Rate Series) – The return of CLPGD is linked to the performance of the reference exchange rate(s). Movements in exchange rates can be sudden and drastic, and affected by complex political and economic factors. You will be exposed to a risk of loss arising from exchange rate fluctuations. If the deposit currency is not 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.

Foreign Exchange Risk (Only applicable to CLPGD – Fixed Rate Series) – The return of CLPGD – Fixed Rate Series is linked to the difference between the spot rate and forward rate of the deposit currency and linked currency. Movements in exchange rates can be sudden and drastic, and affected by complex political and economic factors. If the deposit currency is not 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.

Exchange Control - For currencies subject to exchange controls imposed by the relevant governments, such as renminbi (RMB), the exchange rates may be easily affected by change in government policies. Such currencies may have different exchange rates quoted in different markets. For example, exchange rates of RMB are quoted in onshore and offshore markets; the onshore rate of RMB is being referred as "CNY" and the offshore rate (i.e. when traded in Hong Kong) is being referred as "CNH". Although CNY and CNH represent the same currency, they do not necessarily have the same exchange rate and may not move in the same direction.

Limited Potential Return – Investing in CLPGD is not the same as investing in the reference currency pair directly. Even if your view of the market movement of the reference exchange rate(s) is correct, the maximum potential return is limited to the pre-determined interest amount for the CLPGD.

Credit Risk – CLPGD is not supported by any collateral or guarantee. CLPGD is subject to the creditworthiness of the Bank. If the Bank becomes insolvent or goes into liquidation or defaults on its obligations under the CLPGD while it is still outstanding, you will rank as an unsecured creditor of the Bank and could, in the worst case, lose your entire principal irrespective of the terms of the CLPGD.

Liquidity Risk – CLPGD is designed to be held until maturity. CLPGD is not listed on any exchange, has no secondary market and is not transferable. Any termination, cancellation or withdrawal prior to maturity is subject to the sole discretion and consent of the Bank. You may incur significant costs or losses as a result of early termination, cancellation or withdrawal.

Adjustment and Early Termination – The Bank has the right (but not the obligation) to adjust the terms of or to early terminate the CLPGD upon occurrence of certain events. If the terms of CLPGD are adjusted or the CLPGD is terminated by the Bank early, you may suffer a substantial loss under this product.

Conflicts of Interest – Potential conflicts of interest may arise from the different roles played by the Bank, its subsidiaries and / or its affiliates in connection with the CLPGD. The Bank and / or its subsidiaries and / or its affiliates may enter into, adjust or unwind transactions relating to the relevant currencies, whether for its or its subsidiaries' or its affiliates' proprietary accounts or for account under management or to facilitate transactions on behalf of you or otherwise. In carrying out these roles, the Bank's economic interests and those of its subsidiaries and / or its affiliates are potentially adverse to your interest in the CLPGD.

Not Covered by the Investor Compensation Fund – The CLPGD is not listed on any stock exchange and is not covered by the Investor Compensation Fund in Hong Kong.

Settlement Risk – Upon entering into the CLPGD, you shall assume all settlement risks relating to the Bank failing to settle the CLPGD on, before or after the maturity date.

For Settlement Fund of the Order Sourced from To-be-received Funds – The Bank has the right to cancel an order if it fails to receive the funds to be received by you from another investment transaction on time and there is no sufficient fund placed by you for settlement. Any cost, charges and losses incurred as a result thereof shall be borne by you.

This is a structured investment product which is NOT protected by the Deposit Protection Scheme in Hong Kong.

Important Notes

Currency Linked Principal Guaranteed Deposit is a structured investment product and is not equivalent to time deposit. It is not a protected deposit and is not protected by the Deposit Protection Scheme in Hong Kong. This product is only principal protected if customer holds it till maturity. You should read and understand all of the relevant offering documents before deciding whether to invest in CLPGD. In addition, you must also read and understand the governing terms under the Bank's Master Terms and Conditions / Master Terms and Conditions for VIP Banking (as applicable) including its General Terms and all its applicable Specific Terms (each as amended from time to time) in respect of your account and relevant application documents.

Currency Linked Principal Guaranteed Deposit is a structured investment product involving derivatives. This investment decision is yours but you should not invest in this product unless the Bank has explained to you that this product is suitable for you having regard to your financial situation, investment experience and investment objectives.

Unless the context requires otherwise, this document does not constitute an offer, an invitation or recommendation to any person to enter into any investment transaction nor does it constitute any prediction of likely future movements in prices of any investment products.

The above information has not been reviewed by the Securities and Futures Commission or any regulatory authority in Hong Kong.

This service / product is not targeted at customers in the European Union.

For details of Currency Linked Principal Guaranteed Deposit, please contact our staff at branches.