China CDs - Any catch?

For investors outside the US. Personal investments, personal finance, investing news and theory.
Sister forums: Canada, Spain (en español)
---------------
Post Reply
Topic Author
glorat
Posts: 340
Joined: Thu Apr 18, 2019 2:17 am

China CDs - Any catch?

Post by glorat » Tue Jan 14, 2020 9:16 am

HSBC in China - I see 3 options for emergency cash in China
- Bank account - 0.3%, instant access
- Term deposits - range of interest rates, presumably waive the interest on early withdrawal
Or...
https://www.hsbc.com.cn/en-cn/deposits/ ... rtificate/

which look like standard CDs. Their interest rates are at least 0.5% higher than term deposits and early withdrawal is supported where at least some of the accrued interest is kept. Aside from the minimum deposit requirement, it seems this is clearly better than term deposits. It is higher than comparable to US treasury rates, even though USD and CNY tend to track each other generally so one can do something useful with onshore CNY funds.

T&Cs at https://www.hsbc.com.cn/content/dam/hsb ... en-tnc.pdf

The overview highlights:
CDs refer to RMB-denominated book-entry large-denomination deposit vouchers issued electronically by HSBC China to individual customers.
CDs adopt standard terms and minimum deposit amounts, while the interest rate for the issue of CDs is determined by a market-oriented method.

Subject to regulations issued by the People's Bank of China (PBoC). CDs are a financial product in the category of general deposits, which falls within the area of deposit insurance. The minimum deposit amount for an individual subscription is RMB200,000.
Hopefully boglehead expertise can flag up if there is any catch compared to international markets or if I missed a detail.
Last edited by glorat on Tue Jan 14, 2020 9:56 am, edited 2 times in total.

pancake19
Posts: 105
Joined: Thu Jan 16, 2014 1:46 pm

Re: China CDs - Any catch?

Post by pancake19 » Tue Jan 14, 2020 9:31 am

If you're looking for longer term CD's this forum is your best bet, current rates on >3 years are ~3% right here in the good ol' USA... https://www.depositaccounts.com/community/promos/

Silk McCue
Posts: 3809
Joined: Thu Feb 25, 2016 7:11 pm

Re: China CDs - Any catch?

Post by Silk McCue » Tue Jan 14, 2020 9:40 am

pancake19 wrote:
Tue Jan 14, 2020 9:31 am
If you're looking for longer term CD's this forum is your best bet, current rates on >3 years are ~3% right here in the good ol' USA... https://www.depositaccounts.com/community/promos/
This post is in the Non-US Investing forum.

Cheers

Post Reply