Citibank China Branches into Personal Forex Investment Business

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Last updated at: (Beijing Time) Friday, June 06, 2003

Citibank China Branches into Personal Forex Investment Business

Citibank has become the first foreign bank in China to branch into personal foreign exchange (forex) investment by launching a new service named Premium Deposit.

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Citibank has become the first foreign bank in China to branch into personal foreign exchange (forex) investment by launching a new service named Premium Deposit.

The service is a product mix combining foreign currency fixed-term deposits with foreign currency option transactions, which showed a rosy prospect after being put to the Asia-Pacific market.

Compared with traditional forex deposit, this new service requires customers to sign the combination contract to hedge against unfavorable exchange rate fluctuations. While the deposit matures, customers will not only get the principle and interest but also returns from the option transaction.

According to Wang Jiefeng, a senior manager of Citibank China, Premium Deposit has four different terms, namely one month, two months, three months and six months, and there are 36 types of investment available for customers to choose from.

Given such a deposit is subject to the volatile forex market, the bank also promises to provide customers an appraisal report on the possible risks in personal investment.

Although China allowed foreign banks in China to start foreign currency business on March 21 last year, financial analysts said most of them were confined to fixed-term deposits only.

As China opens its banking industry, the personal finance market will become a decisive battlefield between domestic bankingcorporations and their foreign rivals, analysts said.

Richard Stanley, country corporate officer with Citibank China,said that in a market developing as fast as in China, many people wish to have diversified and efficient investment tools to better manage their personal assets.

This innovative service could be just what is needed to meet the burgeoning market demand and help steer China's personal investment market onto a much healthier track, Stanley said.

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