Derivatives

HSBC can provide the following Cross Currency Swap services (including VND):

• Normal tenor is up to 5 years.
• Exchange of principal at maturity.
• The spot exchange rate at the time of doing the deal determines the principal amounts.
• Interest payments are determined at inception.
• Client is fully hedged against foreign exchange risks in terms of both principal and coupons.

Benefits

• Cheaper than the cash markets (i.e. issuing foreign currency bonds directly).
• Can elect to exchange principal at the start if desired.
• Simple documentation compared to cash markets (i.e. issuing a bond, arranging a loan).
• Customised and reversed at any time.
• Off Balance Sheet.