HONG Leong Bank Bhd (HLB) expects its new foreign currencies-fixed deposit account to generate positive response from consumers due to its attractive rates, said chief operating officer (personal financial services) Peter England. He said the product was launched after Bank Negara relaxed its ruling on overseas investment.
Beginning from April 1, Malaysian individuals and corporations who are debt-free can take any amount of their money abroad, and borrowers can convert only RM100,000 per annum. Credit card debt and housing and car loans are not considered as debt or credit facilities. Previously, individuals could only repatriate up to RM10,000 overseas without obtaining permission from the central bank.
"Prior to Bank Negara's announcement, Malaysians were rather limited to what they could do in terms of converting ringgit into foreign currencies, and they could only do so for very specific purposes, mainly for education and employment abroad," England told StarBiz. He said the central bank's new ruling could now allow Malaysians to invest in other currencies by easily opening an onshore or offshore foreign currency account. England said Hong Leong's foreign currencies-fixed deposit account offered easy application, with options to open the account in Hong Kong or Singapore as the bank also had presence in these markets.
"We have the most attractive rates in the shortest period for fixed deposit account in the market and it's a deliberate strategy from Hong Leong to serve our customers better," he said. Chief operating officer (treasury division) Kua Wei Jin said: "The ultimate beneficiaries will be Malaysians, especially parents who want to send their children abroad for studies. They can start locking in the money now in small amounts until their children leave for overseas." With a minimum amount of RM8,000, consumers can open the foreign currencies-fixed deposit account with a choice of nine foreign currencies to invest in. There are no account opening, service or transaction fees, according to Kua.
He said among the foreign currencies offered, the New Zealand dollar had garnered the most interest as it had the best rate at 6.9% per annum. Second in place is the Australian dollar, with 5.5% per annum. > The specific currencies to invest in depend on the needs of consumers. They could also expect better returns from a diversification of currencies, he added. He noted that Malaysians had one of the highest savings rates in the world, thus they had the excess liquidity to put into investments. He said investment in foreign currencies would be subject to foreign exchange rates.
The Star - 6/5/2005