Dual Currency Investment

Transcription

1 Dual Currency Investment Combined Financial Services Guide and Product Disclosure Statement Effective 12 March 2014 Issued by HSBC Bank Australia Limited ABN AFSL No Effective 12 March 2014.

2 CONTENTS Page No. Important Information 1 The HSBC Group 2 Purpose of a Product Disclosure Statement 2 How to contact HSBC Bank Australia Limited 2 The Investment at a Glance 3 About the Investment 6 Investing in a Dual Currency Investment 6 Early Withdrawal and Early Termination 10 Risks to Consider 11 Costs, Fees and Charges 13 Cooling-off Period 13 Taxation 13 Other Information 21 Terms and Conditions 21 How to fill in the Application Form 28 Application Form 32 Financial Service Guide 31

3 Important Information This Product Disclosure Statement (PDS) has been prepared by HSBC Bank Australia Limited, in accordance with the financial product disclosure requirements under the Corporations Act 2001 Cth ( Corporations Act ). The PDS for the Dual Currency Investment referred to in this document is issued by HSBC Bank Australia Limited (referred to as HSBC, we, our or us ). This PDS is dated 12 March 2014 and sets out the terms and conditions that apply to the Dual Currency Investment. Capitalised terms used in this PDS are defined in clause 1 of the Terms and Conditions section of this PDS. The Investments have been structured to be derivatives within the meaning of section 761D of the Corporations Act. The offer to which this PDS relates is available only to persons receiving the PDS (electronically or otherwise) in Australia. The distribution of this PDS (including it being made accessible on any computer network) in jurisdictions outside Australia may be subject to legal restrictions. Any person who resides outside Australia and who receives or gains access to this PDS should comply with any such restrictions as failure to do so may constitute a violation of securities laws. The Investment is not available to US Investors. The Investment is not a deposit with, or loan to, HSBC or any of its related bodies corporate. The Investment is a contractual obligation of HSBC but not any related body corporate of HSBC and is subject to investment risk, including possible delays in payment and loss of income or principal invested. Neither HSBC nor any of its related bodies corporate guarantees the performance of the Investment, or any particular rate of return. None of HSBC s related bodies corporate will repay the principal invested. None of HSBC, the Commonwealth of Australia, any governmental agency or any other person or entity guarantees or otherwise provides assurance in respect of the Investment. Nothing in this PDS is, or may be relied upon as, a representation as to the future performance of the Investment or the Available Currencies. This PDS should be read in full before you make a decision to acquire the Dual Currency Investment. All information provided in this PDS is general and does not take into account your individual objectives, financial situation or specific needs. We recommend that after reading this PDS, you establish whether, given your circumstances, a Dual Currency Investment is suitable for you. If you do decide to open a Dual Currency Investment referred to in this PDS, then we strongly recommend you retain this PDS for future reference. If you received this document electronically, or if you received any updated information other than in writing, we will provide a paper copy free on request. ASIC takes no responsibility for the contents of this PDS. The information in this PDS is subject to change from time to time and is up to date at the date stated on the cover. Where new information is materially adverse HSBC will either issue a new PDS or a Supplementary PDS (SPDS) setting out the updated information. Where the new information is not materially adverse, this information may be updated and made available at A paper copy of any updated information is available free on request. 1

4 The HSBC Group Headquartered in London, HSBC is one of the largest banking and financial services organisations in the world. HSBC s international network comprises some 6,600 offices in 80 countries and territories in Europe, Asia-Pacific, the Middle East, North America and Latin America. With listings on the London, Hong Kong, New York, Paris and Bermuda stock exchanges, shares in HSBC Holdings plc are held by over 220,000 shareholders in 129 countries and territories. The shares are traded on the New York Stock Exchange in the form of American Depositary Receipts. HSBC provides a comprehensive range of financial services to around 95 million customers through four customer groups and global businesses: Retail Banking and Wealth Management (including consumer finance); Commercial Banking; Global Banking and Markets; and Private Banking. HSBC started operations in Australia in 1965 and was awarded a banking licence in The Group s global brand HSBC was adopted by all Australian subsidiaries in In Australia, the HSBC Group offers an extensive range of financial services through a network of 36 branches and offices. This includes: personal banking, financial planning and consumer finance, as well as business, commercial, corporate and institutional banking, payments and cash management, trade and export finance, treasury and financial markets, project finance, corporate finance and securities custody. Purpose of a Product Disclosure Statement This PDS is an important legal document setting out information about the HSBC Dual Currency Investment. The information in this PDS should assist you to: decide if this Investment meets your needs; and compare this Investment with similar products. If you intend to apply to acquire this Investment, please read this PDS thoroughly, then keep it, together with all other documentation which you receive from HSBC in connection with this Investment, for future reference. If you have any questions or need more information, please contact HSBC. How to contact HSBC Bank Australia Limited L32, 580 George Street, Sydney NSW 2000 Telephone: (Toll free within Australia) (From overseas) Fax: Web: [email protected] Principal HSBC Group members in Australia are HSBC Bank Australia Limited and The Hongkong and Shanghai Banking Corporation Limited. Issuer HSBC Bank Australia Limited is the issuer of this Investment and this PDS. HSBC Bank Australia Limited is an authorised deposittaking institution in Australia and holds an Australian financial services licence. For more information on HSBC Bank Australia Limited see 2

5 The Investment at a Glance This section highlights some of the key information you will find in this PDS regarding the Investment. It is not a complete summary. You should read the whole PDS and seek any advice you need before deciding to invest. What is the Investment? Who is issuing the Investment? What Investment Terms are available? A Dual Currency Investment is a fixed rate investment with a return that is generally higher than returns for an HSBC term deposit in the Base Currency with a term equivalent to the Investment Term. Refer to Determining the Investment Rate for more details. However, unlike many fixed rate investments, there is a risk that, because of exchange rate movements, the value of your Investment at maturity will be less than the amount you invested. You select a pair of currencies (a Base Currency and an Alternate Currency) and other Investment Parameters including the Investment Term. Based on your selected Investment Parameters, HSBC will offer you a fixed rate (the Investment Rate). If you accept the Investment Rate, the Investment will proceed and the Investment Amount will be deducted from your Base Currency account with HSBC. On the Maturity Date the Proceeds of your Investment will be paid to you in either the Base Currency or the Alternate Currency as described in Determining the currency of the Proceeds. If the Proceeds are paid to you in your Alternate Currency, this might cause you to make a loss on your Investment. The Investment is not a bank deposit or a loan to HSBC. It should be considered a risky investment and by investing, you are speculating on the future movement of the exchange rate of your selected Currency Pair. HSBC Bank Australia Limited. One week Two weeks Three weeks One month Two months Three months Other terms may be available on request. Up to a maximum of three months. What are the available Currency Pairs? 1. AUD / USD 2. AUD / EUR 3. AUD / GBP 4. AUD / HKD 5. AUD / JPY 6. AUD / NZD 7. EUR / GBP 8. EUR / USD 9. GBP / USD 10. NZD / USD 11. USD / JPY 12. AUD / CAD 13. AUD / SGD The above three character currency codes are based on the International Organisation for Standardisation 4217 standard. The above list is not an exhaustive list, other Currency Pairs may be offered by HSBC from time to time, ask our staff for details. What is the applicable exchange rate for the Currency Pair? The exchange rate for each Currency Pair will be quoted using the quoting method consistent with the Australian convention used for quoting exchange rates in the foreign exchange market, regardless of which currency in your Currency Pair is selected as the Base Currency. 3

6 What is the Return on my Investment? What are the objectives of the Investment? What are the key advantages of the Investment? The Investment Rate offered for an Investment will depend on the Investment Parameters which you select, the prevailing interest rates in both of the currencies you select and the volatility of the exchange rate of your Currency Pair at the time you enter into your Investment. Generally speaking, the more conservative the Investment Parameters you select, the lower the Investment Rate HSBC will offer. Ordinarily, HSBC will not accept Investment Parameters that are so conservative that the Investment Rate would not exceed the interest rate for an HSBC term deposit in the Base Currency with a term equivalent to the Investment Term. Refer to Determining the Investment Rate for more details. The Investment Rate offered by HSBC may vary during the course of each day and will be set at the time you enter into an Investment with HSBC (by agreeing to the terms with the Dual Currency Investment team). The factors impacting on the Investment Rate HSBC will offer are summarised in Determining the applicable Investment Rate. To provide an investment with an Investment Rate that is generally higher than interest rates available on HSBC term deposits in the Base Currency for a term equivalent to the Investment Term. Refer to Determining the Investment Rate for more details. The key advantages of the Investment are: Flexibility With nine Available Currencies there are fifteen different currency pairs that can be selected. You may choose the Investment Term and the Strike Rate in accordance with your risk preference. Diversification By investing in a number of these Investments, you may achieve diversification in a portfolio of foreign currencies by choosing different combinations of currencies, Strike Rates and Investment Terms. What are the key risks of the Investment? What are the fees for the Investment? The key risks of the Investment are: Foreign exchange rate risk General market risk Early withdrawal risk Operational risk There are other risks. It is important you read Risks to Consider section of this PDS before investing in the Dual Currency Investment. There is no application fee, establishment fee or any ongoing management fee charged to you in respect of your Investment. The cost of putting each investment in place and the profit HSBC expects to make in offering the Investment are incorporated as a margin into the Investment Rate quoted to you. There is no additional fee or charge payable by you. f you convert your proceeds to another currency after termination of the Investment, you may incur costs and charges in connection with that conversion as set out in Personal financial services charges your guide. If HSBC allows you to terminate your Investment before the Decision Time, the Early Withdrawal proceeds you will receive will be calculated taking into account any loss or costs that may be incurred by HSBC terminating the Investment prematurely. This is described in more detail in Early Withdrawal and Early Termination. 4

7 How to apply for the Investment? What happens if I want to terminate my Investment prior to the Maturity Date? How much can I invest? To complete a Dual Currency Investment Application Form, you must have an HSBC account in one or more of the Available Currencies. To enter into an Investment, you must have an HSBC account in both the Base Currency and the Alternate Currency you select for the Investment. If you do not have an account in one of the Available Currencies, you may open an account by visiting your nearest HSBC branch or calling the DCI Team on You must complete, sign and return to HSBC the Dual Currency Investment Application Form available at the back of this PDS. You may return the Application Form by either posting it to the DCI Team at PO Box 3096, Parramatta NSW 2124 or delivering it to your nearest HSBC branch. The Investment is designed to be held to the Maturity Date but HSBC may allow you to terminate your Investment early in exceptional circumstances. If you choose to terminate your Investment early, the proceeds you will receive will be HSBC s determination of the fair economic value of your Investment taking into account any loss or costs that may be incurred by HSBC in terminating your Investment prematurely, which will depend upon a number of factors. These factors are described in Early Withdrawal and Early Termination. The minimum Investment Amount for a single Investment is USD 50,000 (or otherwise agreed to by HSBC) or its equivalent in one of the Available Currencies up to a maximum investment of USD 1,000,000 or its equivalent in one of the Available Currencies. Is there a cooling-off period? What can I expect to be paid on the Maturity Date? Statements No, there is no cooling-off period for investing in the Dual Currency Investment. You will be paid the Proceeds, which will equal your Investment Amount plus your Return less tax (as applicable). The Proceeds will be paid in either the Base Currency or the Alternate Currency (converted at the Strike Rate). As you will also have accounts with HSBC, you will be issued a consolidated statement which will include your accounts with HSBC and your Dual Currency Investment. You will be issued a Confirmation Advice and a Maturity Advice for each Dual Currency Investment. 5

8 About the Investment The Dual Currency Investment is a fixed rate investment the value of which can be affected by a foreign exchange rate. The Investment Rate is fixed for the term of your Investment and will depend on the Investment Parameters selected by you, the prevailing interest rates in both of the currencies you select and the volatility of the exchange rate of your Currency Pair at the time you enter into your Investment. A key aspect of a Dual Currency Investment is that the Proceeds of your Investment will be paid to you in one of the two currencies in the Currency Pair nominated by you at the time you enter your Investment. The applicable currency will depend on where the exchange rate for your Currency Pair is compared to your Strike Rate at the Decision Time. This means that the Investment will be exposed to risks of adverse movements in the relevant exchange rate. The Investment offers you the potential to tailor an investment (within limited parameters) to achieve a higher Investment Rate than is generally available from HSBC term deposits with terms comparable to the Investment Term. Generally, the closer you set the Strike Rate to the prevailing Spot Rate, the higher the Investment Rate HSBC will offer. Conversely, the further you set the Strike Rate from the prevailing Spot Rate (i.e. the more conservative your Investment Parameters), the lower the Investment Rate HSBC will offer. HSBC will ordinarily not accept Investment Parameters that are so conservative that the Investment Rate would not exceed the interest rate for an HSBC term deposit in the Base Currency with a term equivalent to the Investment Term. This is explained in more detail in Determining the Investment Rate. However, the Investment is subject to exchange rate risk unlike most fixed rate investments. If the Base Currency has appreciated against the Alternate Currency so that it is equal to, or has moved beyond the Strike Rate at the Decision Time, HSBC will ordinarily convert your Proceeds to the Alternate Currency at the Strike Rate. There may be circumstances where HSBC offers term deposit interest rates that may be greater than the Investment Rate derived from your selected Investment Parameters. This is explained in more detail in Determining the currency of the Proceeds. The Investment is not a bank deposit with or a loan to HSBC. It should be considered a risky investment and by investing, you are speculating on the future movement of the exchange rate of the Currency Pair. Investing in a Dual Currency Investment Prerequisites In order to invest in a DCI, you must: 1. Complete, sign and send us your Application Form; 2. Have accounts with us in both the Base Currency and the Alternate Currency; 3. Have sufficient funds in your Base Currency account to pay the Investment Amount at the time the investment is entered into (unless otherwise agreed to by HSBC); and 4. Call HSBC s DCI Team on or your Premier Investment Relationship Manager to select your Investment Parameters and agree the Investment Rate and confirm your Investment. Selecting your Investment Parameters Once you have completed the prerequisites, you must select the following Investment Parameters: Base Currency the currency in which the Investment is denominated. Alternate Currency the currency in which you are prepared to receive the Proceeds of your Investment on the Maturity Date, converted at the Strike Rate (being the other currency in your selected Currency Pair). Investment Amount the amount you choose to invest in the Investment. Investment Term the period you choose for your Investment, beginning on the Start Date and ending on (but excluding) the Maturity Date. Strike Rate an exchange rate selected by you for the Base Currency and Alternate Currency. If your Base Currency appreciates against your Alternate Currency beyond the Strike Rate at the Decision Time, HSBC will ordinarily convert your Proceeds to the Alternate Currency at the Strike Rate. You will ordinarily receive the Proceeds in the weaker currency when comparing the Decision Rate to the Strike Rate. The Strike Rate may also be the exchange rate at which you are prepared to convert your Proceeds to the Alternate Currency. Please note: If your Base Currency is the first currency in your Currency Pair, you will not be able to select a Strike Rate that is below the Spot Rate at the time you enter into your Investment. If your Base Currency is the second currency in your Currency Pair, you will not be able to select a Strike Rate that is above the Spot Rate at the time you enter into your Investment. 6

9 Determining the applicable Investment Rate The Investment Rate on an Investment will be determined by HSBC by reference to the Investment Parameters you set, the prevailing interest rates in both the currencies selected and the volatility of the exchange rate of your Currency Pair at the time you enter into your Investment. As a general rule: the closer the Strike Rate is to the Spot Rate, the higher the Investment Rate; the higher the prevailing interest rates in both the currencies selected, the higher the Investment Rate. Generally speaking, prevailing interest rates in the Base Currency will be more determinative of the Investment Rate than prevailing interest rates in the Alternate Currency; and the more volatile the exchange rate of your Currency Pair, the higher the Investment Rate. Investment Rates offered by HSBC will vary from day to day and also during the course of a day. You will be advised of the applicable Investment Rate before you confirm your Investment. The date on which you confirm your Investment will be the Trade Date. HSBC will only allow you to confirm an investment with a Start Date that is a Business Day in respect of the Base Currency and USD. To set your Investment Parameters and to find out and agree the Investment Rate that will apply to your Investment, contact the DCI Team on or your Premier Investment Relationship Manager. Once a quote has been provided to you, you will need to make your decision whether to proceed with the Investment quickly otherwise the quote may need to be refreshed. For the purpose of identifying you, we may request that you provide our DCI Team with the Personal Banking Number (PBN) and Personal Identification Number (PIN) provided to you by HSBC. As the foreign exchange market is dynamic, the Spot Rate for your Currency Pair will change continuously. If you wish to lock-in a specific Investment Rate, it may take several attempts to achieve this. HSBC will ordinarily not accept Investment Parameters that are so conservative that the Investment Rate would not exceed the interest rate for an HSBC term deposit in the Base Currency with a term equivalent to the Investment Term. There may be circumstances where HSBC offers term deposit interest rates that may be greater than the Investment Rate derived from your selected Investment Parameters. An example may be where HSBC is offering special term deposit interest rates for a particular investment term and the interest rate is above the minimum interest rate benchmark used by HSBC to determine your Investment Rate. Entering into an Investment Before accepting your Investment, HSBC will confirm your selected Investment Parameters and the offered applicable Investment Rate. The Investment will be issued to you immediately following this verification and your agreement to proceed. Unless HSBC agrees otherwise, your Investment Amount must be made available as cleared funds in your nominated Base Currency account to be debited by HSBC on the Start Date. A hold will be placed on your funds when you enter your investment on the Trade Date. If for any reason you do not have sufficient funds to settle your Investment, you are deemed to have requested an Early Withdrawal. The issue of your Investment will be confirmed in writing to you within five Australian Business Days of the Trade Date. Determining the currency of the Proceeds A comparison of the Strike Rate against the Decision Rate (the Spot Rate at the Decision Time) will determine whether you will be paid the Proceeds in either the Base Currency or the Alternate Currency (converted at the Strike Rate). If the Base Currency has strengthened against the Alternate Currency so that it is equal to, or has moved beyond the Strike Rate at the Decision Time, HSBC will ordinarily convert your Proceeds to the Alternate Currency at the Strike Rate. While HSBC has the discretion not to convert your Proceeds to the Alternate Currency in these circumstances, HSBC expects that it would always convert Proceeds to the Alternate Currency unless it considers that it is impossible or impractical to convert the Proceeds to the Alternate Currency. In any other case, your Proceeds will be paid to you in the Base Currency on the Maturity Date. The following table explains how this determination is made: Base Currency selected First currency in the Currency Pair Second currency in the Currency Pair Decision Rate Greater than or equal to the Strike Rate Less than the Strike Rate Greater than the Strike Rate Less than or equal to the Strike Rate Proceeds paid in: Alternate Currency Base Currency Base Currency Alternate Currency This means you will ordinarily receive the Proceeds in the weaker currency when comparing the Decision Rate to the Strike Rate. 7

10 HSBC will always quote the exchange rate between the Base Currency and the Alternate Currency in the same order as the currencies that appear in each Currency Pair as set out in the The Investment at a Glance section of this PDS regardless of which currency you choose as your Base Currency or Alternate Currency. Hypothetical Examples Where the Base Currency is the first currency in the Currency Pair You invest in a Dual Currency Investment with the following Investment Parameters: Trade Date: 29 September Start Date: 1 October Base Currency: AUD Alternate Currency: USD Investment Amount: AUD 100,000 Investment Term: 31 calendar days Strike Rate: Investment Rate: 13.37% per annum Decision Time: Tuesday, 30 October at 3:00pm (Tokyo time) Maturity Date: 1 November The Spot Rate at the time the Investment was entered into was The Investment Parameters shown above are used in Scenario 1 and Scenario 2. The Currency Pair is AUD/USD and AUD is the first currency in the Currency Pair. Return calculation: The Investment will pay a Return of AUD 1, on the Maturity Date, as per the following calculation: AUD 100,000 x 13.37% x 31 days = AUD 1, days Scenario 1 The following example is used to explain which currency your Proceeds will be paid in. It is not intended to be indicative of the past or future performance of any exchange rate or the Investment or any Investment Rate HSBC will offer. The rates used are not indicative or current or expected exchange rates or Investment Rates. Larger Version of Scenario 1 Base Currency: AUD Investment Amount: AUD 100,000 Stronger AUD Strike Rate: AUD/USD Weaker AUD The diagram above shows a situation where the Decision Rate for the AUD/USD is above the Strike Rate as at the Decision Time. The Decision Rate is AUD/USD As at the Decision Time the AUD/USD exchange rate is above the Strike Rate, the Proceeds are converted to U.S. Dollars at the Strike Rate and credited to your nominated Alternate Currency account. Proceeds = AUD 100,000 + AUD 1, = AUD 101, x Strike Rate = USD 80, NOTE: Spot Rate: Sep 1 Oct Trade Date Start Date Two business days Investment term Decision Rate: Oct 1 Nov Decision Time MaturityDate Two business days In this example, the Proceeds have been converted into the Alternate Currency at the Strike Rate (i.e ) if the market exchange rate is AUD/USD at the time of reconversion to the Base Currency, the Proceeds converted back to the Base Currency (AUD) will be: USD 80, / = AUD 99, (AUD Loss) This example highlights that you might receive less than your Investment Amount when the exchange rate for this Currency Pair remains above the Strike Rate at the time of re-conversion back to AUD 8

11 Scenario 2 The following example is used to explain which currency your Proceeds will be paid in. It is not intended to be indicative of the past or future performance of any exchange rate or the Investment or any Investment Rate HSBC will offer. The rates used are not indicative or current or expected exchange rates or Investment Rates. Larger Version of Scenario 2 Base Currency: AUD Investment Amount: AUD 100,000 Stronger AUD Strike Rate: AUD/USD Weaker AUD Spot Rate: Sep 1 Oct Trade Date Start Date Two business days Investment term Decision Rate: Oct 1 Nov Decision Time MaturityDate Two business days The diagram above shows a situation where the Spot rate for the AUD/USD is below the Strike Rate as at the Decision Time. The Spot Rate at the time the Investment was entered into was The Investment Parameters shown above are used in Scenario 3 and Scenario 4. The Currency Pair is GBP/USD and USD is the second currency in the Currency Pair. Return calculation: The Investment will pay a Return of USD on the Maturity Date, as per the following calculation: USD 100,000 x 9.19% x 31 days = USD days* * 360 days is used as this is the day count convention used for the USD. Scenario 3 The following example is used to explain which currency your Proceeds will be paid in. It is not intended to be indicative of the past or future performance of any exchange rate or the Investment or any Investment Rate HSBC will offer. The rates used are not indicative or current or expected exchange rates or Investment Rates Larger Version of Scenario 3 Base Currency: USD Investment Amount: USD 100,000 The Decision Rate is AUD/USD As the Australian Dollar has weakened against the U.S. Dollar and the Decision Rate is below the Strike Rate at the Decision Time, the Proceeds are credited to your nominated Base Currency account in Australian Dollars. Proceeds = AUD 100,000 + AUD 1, = AUD 101, Where the Base Currency is the second currency in your Currency Pair You invest in a Dual Currency Investment with the following Investment Parameters: Weaker USD GBP/USD Strike Rate: Stronger USD Spot Rate: Sep 1 Oct Trade Date Start Date Two business days Investment term Decision Rate: Oct 1 Nov Decision Time MaturityDate Two business days Trade Date: 29 September Start Date: 1 October Base Currency: USD Alternate Currency: GBP Investment Amount: USD 100,000 Investment Term: 31 calendar days Strike Rate: Investment Rate: 9.19% per annum The diagram above shows a situation where the Decision Rate for the GBP/USD is above the Strike Rate as at the Decision Time. The Decision Rate is GBP/USD As the U.S. Dollar has weakened against the Pound Sterling and the Decision Rate is above the Strike Rate at the Decision Time, the Proceeds are credited to your nominated Base Currency Account in U.S. Dollars. Proceeds = USD 100,000 + USD = USD 100, Decision Time: Tuesday, 30 October at 3:00pm (Tokyo time) Maturity Date: 1 November 9

12 Scenario 4 The following example is used to explain which currency your Proceeds will be paid in. It is not intended to be indicative of the past or future performance of any exchange rate or the Investment or any Investment Rate HSBC will offer. The rates used are not indicative or Larger current Version of or Scenario expected 4 exchange rates or Investment Rates. Base Currency: USD Investment Amount: USD 100,000 Weaker USD GBP/USD Strike Rate: Stronger USD The diagram above shows a situation where the Decision Rate for the GBP/USD exchange rate is below the Strike Rate as at the Decision Time. The Decision Rate is GBP/USD As at the Decision Time the GBP/USD exchange rate is below the Strike Rate, the Proceeds are converted to Pound Sterling at the Strike Rate and credited to your nominated Alternate Currency account. Proceeds = USD 100,000 + USD = USD 100, Strike Rate = GBP 60, NOTE: In this example the Proceeds have been converted into the Alternate Currency at the Strike Rate (i.e ). If you choose to reconvert the Proceeds back to the Base Currency and the market exchange rate is GBP/ USD at the time of reconversion, the Proceeds converted back to Base Currency (USD) will be: GBP 60, x = USD 99, (USD Loss) This example highlights the possibility that you might receive less than your Investment Amount when the exchange rate for this Currency Pair remains below the Strike Rate at the time of re-conversion back to USD. Early Withdrawal and Early Termination Early Withdrawal Investment term Spot Rate: Sep 1 Oct Trade Date Start Date Two business days Decision Rate: Oct 1 Nov Decision Time MaturityDate Two business days The Dual Currency Investment is designed to be held for the full Investment Term selected by you. However, you may request in writing to terminate your Investment before the Decision Time. If you choose to do so and HSBC accepts your request, HSBC will pay you an amount equal to HSBC s determination (in a commercially reasonable manner) of the fair economic value of your Investment at the time your Early Withdrawal request is accepted. This calculation will take into account any loss or costs that may be incurred by HSBC in unwinding its position prematurely, which will depend upon a number of factors. The main factors which impact on the fair economic value of your Investment include: a comparison between the Spot Rate and the Strike Rate: a comparison between the exchange rate for your Currency Pair at the time HSBC accepts your Early Withdrawal request, and the Strike Rate, will affect HSBC s calculation of the fair economic value of your Investment. For example if the Base Currency has appreciated against the Alternate Currency and is beyond the Strike Rate at the time HSBC accepts your Early Withdrawal Request, this may result in a lower valuation of your Investment; volatility of the exchange rate: the volatility of the exchange rate for your Currency Pair might affect HSBC s calculation of the fair economic value of your Investment. Generally speaking, the higher the volatility of the exchange rate, the lower the valuation of your Investment; time to Maturity Date: generally speaking, the longer the time to the Maturity Date, the lower the valuation of your Investment; There will be no other fees and charges imposed by HSBC on your Early Withdrawal. The proceeds of an Early Withdrawal cannot be less than zero. HSBC reserves the right to accept or refuse an Early Withdrawal request at its sole discretion or to impose conditions on accepting an Early Withdrawal request. HSBC will pay you the proceeds of your Early Withdrawal in the Base Currency, unless for any reason HSBC considers that it is impossible or impractical to pay the proceeds of your Early Withdrawal in the Base Currency, in which case the proceeds will be paid in another major currency selected by HSBC. Early Termination There may be certain foreign exchange related events that occur outside the control of HSBC. HSBC may declare an Early Termination Event in respect to your Investment if any of the following Early Termination Events occur: a. restrictions on convertibility and transferability are applied to any of the currencies in your Currency Pair; b. any currency (except Euro) in your Currency Pair ceases to be the official currency of its issuing nation or jurisdiction (as applicable); c. if one of the currencies in your Currency Pair is the Euro, and the Euro ceases to be the official 10

13 currency of all member states in the European Economic and Monetary Union; d. if HSBC determines in good faith that the performance of its obligations under the Terms and Conditions has or will become in circumstances beyond the reasonable control of HSBC, impossible, unlawful, illegal or otherwise prohibited as a result of compliance with any applicable present or future law, rule, regulation, judgement, order or directive of any government, administrative, legislative or judicial authority or power; or e. any actual or proposed event that may reasonably (in HSBC s opinion) be expected to lead to any of the events referred to in paragraphs a. to d. above occurring. If an Early Termination Event occurs, HSBC may terminate your Investment. The proceeds of an Early Termination will be your Investment Amount and accrued Return (pro rated reflecting the portion of the Investment Term that has expired as at the date of termination). Proceeds of Early Termination will be paid to you in the Base Currency unless, for any reason HSBC considers that it is impossible or impractical to pay your Early Termination proceeds in the Base Currency, in which case the proceeds will be paid in another currency (ordinarily a major currency) selected by HSBC. Risks to Consider There are a number of factors which may affect the future performance of the Investment. This section describes the risks associated with the Investment. You should carefully consider the range of risk factors outlined in this section, as well as the other information contained in this PDS, before deciding if the Investment is suitable for you. You should consider your financial targets, investment time frame and degree of risk you will accept in order to achieve your investment objectives. We recommend that you seek independent financial advice and other expert advice before investing. This Investment should be considered a risky investment and by investing, you are speculating on the future movement of the exchange rate of your Currency Pair. Although the Investment Rate is fixed for the life of the Investment, you should be aware that: The Proceeds of your Investment may be paid in the Alternate Currency and not the Base Currency of your Investment. If you are paid in the Alternate Currency on the Maturity Date and the Base Currency continues to strengthen against the Alternate Currency so that the exchange rate continues to trade beyond the Strike Rate, you will incur a loss if you convert the Proceeds back into the Base Currency. This loss may be greater than the Return earned on the Investment. The risk of adverse movements in the exchange rate for your Currency Pair is significant. The Investment might not be suited to an investor who wishes to convert Base Currency to Alternate Currency. This investor might receive a better exchange rate by a direct currency conversion. Also, a direct currency conversion is more flexible and more certain than a currency conversion under the Investment. If your view is that the Base Currency will weaken against the Alternate Currency over the Investment Term, you may have been able to achieve a more favourable outcome by converting to the Alternate Currency at the prevailing exchange rate. This is because the Return on the Investment does not reflect the favourable movement in the exchange rate. General Market Risk There are a number of factors and events which could affect the foreign exchange rates and the value of your Investment. These include, but are not limited to, changes in: Economic conditions (e.g. foreign debt levels); Government and political factors; Domestic and international stock and capital markets; Investor sentiment; Interest rates. Foreign Exchange Risk If at the Decision Time your Base Currency appreciates against your Alternate Currency beyond the Strike Rate, you will make a loss on the currency conversion at the Maturity Date and this loss might exceed the Return on your Investment. Before you enter into an Investment, it is important you understand the forces that drive exchange rates. The future outcome of your Investment is directly linked to the performance of the exchange rate for your Currency Pair. At the Decision Time, if the Base Currency has strengthened against the Alternate Currency so that the Decision Rate is equal to or stronger than the Strike Rate, you will be paid the Proceeds in the Alternate Currency. A conversion of the Proceeds back into the Base Currency will need to be done at the prevailing exchange rate and may reduce the net return or result in a loss on your Investment. The amount may be substantial depending on the size of the movement in the exchange rate for your Currency Pair. This is explained in more detail in Determining the currency of the Proceeds. 11

14 By investing you will be subject to the risk that the Base Currency will appreciate against the Alternate Currency beyond your selected Strike Rate. Exchange rates are very difficult, if not impossible, to predict. Economic differences between countries in such areas as national income, money growth, inflation and trade balances have long been considered critical determinants of currency values. However, there is no definitive evidence that any economic variable can forecast exchange rates for currencies of nations with similar inflation rates. You will need to keep this in mind when considering entering into an Investment. There is limited scope to take advantage of views on future exchange rate movements under this product. There may be a loss incurred as a result of foreign exchange controls imposed by the country which issued the foreign currency. Payment of amounts due to you may be delayed or prevented by the exchange controls or other actions imposed by governmental or regulatory bodies. Early Withdrawal Risk HSBC reserves the right to refuse an Early Withdrawal request in its sole discretion. This means that you may not be able to access your Investment until the Maturity Date. If you request an Early Withdrawal and your request is accepted by HSBC, there is a risk that you will receive less than you initially invested. The proceeds of an Early Withdrawal will be calculated taking into account any loss or costs that may be incurred by HSBC in terminating the Investment prematurely as described in Early Withdrawal and Early Termination. This might result in you making a loss on your Investment. You should also consider the tax consequences of an early withdrawal. Exercise of Discretion by HSBC The Terms and Conditions give HSBC discretions in relation to certain aspects of the Investment. For example, HSBC has discretions in relation to the occurrence of an Early Termination Event. The exercise of these discretions may adversely affect the value of your Investment. You do not have the ability to direct HSBC regarding the exercise of its discretions. Potential Conflicts of Interest HSBC Bank Australia Limited and other members of the HSBC Group may conduct transactions as principal and as agent in the foreign exchange market, including the buying and selling of Available Currencies. These trading activities may affect (positively or negatively) the exchange rates of Available Currencies. Information Risk HSBC s market views, if given (whether express or implied), are based on information believed to be reliable at that time. HSBC is not responsible, nor liable if actual market movements adversely affect your Investment. If you rely on a forecast from any person about the exchange rate for your Currency Pair you will be subject to the risk that the forecast is inaccurate. Early Termination Event Risk An occurrence of an Early Termination Event gives HSBC the right to declare an Early Termination of the Investment. If this occurs, the Investment will terminate before the Maturity Date and you will receive your Investment Amount and accrued Return (up to the date of Early Termination) in the Base Currency unless, for any reason HSBC considers that it is impossible or impractical to pay your Early Termination proceeds in the Base Currency, in which case they will be paid in another major currency selected by HSBC. This is explained in more detail in Early Withdrawal and Early Termination. The proceeds of an Early Termination might be less than if the Investment continued to the Maturity Date. Please read the Early Termination in the About the Investment and Terms and Conditions sections of this PDS for further details. Exposure to HSBC Bank Australia Limited When you invest in the Investment you are relying on the general creditworthiness of HSBC and its ability to meet its contractual obligations. In the unlikely event that HSBC becomes unable to meet its obligations, or suspends payment, your investment in the Investment will rank equally with other unsecured nondeposit obligations of HSBC (and behind deposit liabilities and other priority liabilities of HSBC). In this situation you might receive less than the amount to which you would be entitled otherwise. Obligations created by the Investment do not constitute deposit obligations of HSBC. None of HSBC, the Commonwealth of Australia, any governmental agency or any other person or entity guarantees or otherwise provides assurance in respect of the Investment. Operational Risk Operational risk is the risk of losses from inadequate or failed internal processes, people or systems. Your Investment relies on HSBC undertaking the processes described in this PDS in a timely and accurate manner. HSBC is responsible for managing the operational risk of the Investment. If HSBC s systems and processes are inadequate and you make a request to HSBC for an Early Withdrawal of your Investment, the potential delay including the delay to any currency conversion may adversely affect your Investment. Base Currency Account - Access to Investment Amount A hold will be placed on the Investment Amount in your Base Currency Account when you enter your investment on the Trade Date. You must ensure that you have sufficient 12

15 funds in the balance of your Base Currency Account, less the Investment Amount, to cover any other payments you make from the Base Currency Account, or you risk those other payments being dishonoured. Costs, Fees and Charges There is no application fee, establishment fee or any ongoing management fee charged to you in respect of your Investment. The cost of putting each Investment in place and the profit HSBC expects to make in offering the Investment are incorporated as a margin into the Investment Rate quoted to you, and are not an additional fee or charge payable by you. You will be subject to the ordinary fees and charges in relation to your Base Currency account and your Alternate Currency account. Other general service fees or charges may apply for related transactional services such as telegraphic transfers of funds. Additionally, if you wish to convert your Proceeds to another currency after the termination of the Investment, you may be subject to fees and costs. Information about these costs is contained in our separate document Personal financial services charges your guide. If you are not an Australian resident, HSBC must withhold tax at the non-resident withholding tax rate (10.00% at the date of this PDS) from the Return and remit the withheld amount to the Australian Taxation Office. Foreign Exchange Gains and Losses Transactions (in particular withdrawals) in relation to the Investment may give rise to taxable gains or deductible losses. The treatment of these transactions for taxation purposes will depend on your individual circumstances. The following tax opinion is a general guide to the key tax implications which apply to your Investment. This guide does not take into account your specific taxation situation and the taxation consequences may vary depending on your particular circumstances. We recommend that you seek independent tax advice before entering into an Investment. Early Withdrawal If you decide to terminate your Investment before the Maturity Date and HSBC agrees to your request, the proceeds you will receive will be calculated taking into account any loss or costs that may be incurred by HSBC in terminating your Investment prematurely. The factors affecting HSBC s calculation of the proceeds of your Early Withdrawal are described in the section headed Early Withdrawal and Early Termination. Cooling-off Period No cooling-off There is no cooling-off period that applies to the Investment offered in this PDS. Taxation Return paid on your Investment The Return credited to your account on the Maturity Date may be assessed for income tax purposes. In some circumstances (e.g. if you are tax exempt) this Return may not be included as part of your income tax assessment. Any Return earned from your Investment which is assessable must be declared at tax time. Withholding Tax If you are an Australian resident you may, but are not obliged to, provide HSBC with your Tax File Number (TFN) or Australian Business Number (ABN). If you do not provide your TFN or ABN, HSBC must withhold tax calculated at the top marginal tax rate applicable to Australian resident individuals plus 1.5% Medicare Levy from the Return and remit the withheld amount to the Australian Taxation Office. 13

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23 Other Information Consents Mallesons Stephen Jaques, Solicitors, has given its written consent to the inclusion in the PDS of the letter in Taxation in the form and context which it is included, and has not withdrawn that consent before the date of this PDS. They have not caused the issue of this PDS or made any statement that is included in this PDS or any statement on which a statement in this PDS is based, except as stated above. Other than where they are specifically referred to, they expressly disclaim and take no responsibility for any statements in, or omissions from, this PDS. This applies to the maximum extent permitted by law and does not apply to any matter and to the extent to which consent is given above. Complaints HSBC is committed to the delivery of excellence through the highest customer service standards. Whether you are providing feedback, paying a compliment or making a complaint your input is important. We aim to resolve most issues within five working days. If more complex, it can take longer but we ll keep you informed of progress. If you believe a transaction is wrong or unauthorised, or there is an error in any confirmation, or if you have any concerns about procedure, compliance issue(s), or have encountered a problem with our service, we want you to tell us about it. We have designed a simple customer complaint process. If you believe a currency transfer is wrong or unauthorised, please contact us on If you have another complaint or concern, the first place to make it known is your Relationship Manager, who should be able to resolve your problem. If your complaint has not been resolved to your satisfaction, please contact our Customer Relations Team: Telephone: Facsimile: Mail: (Toll free within Australia) (From overseas) Customer Relations Team HSBC Bank Australia Limited 580 George Street SYDNEY NSW 2000 Or you can log onto our website, and record your complaint or feedback via the Contact Us icon. If, despite our best efforts, you believe your complaint has not been satisfactorily dealt with, you may wish to contact an approved external dispute resolution scheme. You may contact the Financial Ombudsman Service by writing to: Financial Ombudsman Service Mail: GPO Box 3 MELBOURNE VIC 3001 Telephone: (03) Facsimile: (03) Website: [email protected] However, before an external dispute resolution scheme can investigate a matter, we would like you to give us the opportunity to review it first. Terms and Conditions The Terms and Conditions for the HSBC Dual Currency Investment consist of each of the following documents: 1. this PDS; 2. your Confirmation Advice; and 3. our separate booklet titled Personal financial services charges your guide. When you apply for or enter into an Investment you agree to be bound by each of these. HSBC warrants that it will comply with the requirements of the Code of Banking Practice where those requirements apply to your dealings with it. This section of the PDS sets out the rights, terms, conditions and obligations of the Dual Currency Investment. If HSBC accepts your application for the Investment, these conditions and the Application Form, form the agreement between you and HSBC that constitutes the Investment. 1. DEFINITIONS FOR EXPRESSIONS USED IN THIS PDS The following expressions have the following meaning where used anywhere in this PDS. Alternate Currency means in relation to each Investment, the Available Currency selected by the Customer as the alternate currency and specified as such in the relevant Confirmation Advice. AUD or Australian Dollar means the lawful currency of Australia. Authorised Signatory means any person who you have authorised us to accept instructions from in respect of your Investment. Available Currencies means Australian Dollars, Canadian Dollars, Euro, Hong Kong Dollars, Japanese Yen, New Zealand Dollars, Pound Sterling, Singapore Dollars and U.S. Dollars. Base Currency means in relation to each Investment, the Available Currency selected by the Customer as the currency in which the Investment is denominated, as set 21

24 out in the relevant Confirmation Advice. Business Day means, in respect of an Available Currency, a day (other than a public holiday or a Saturday or a Sunday) on which commercial banks are open for business in the city HSBC determines to be the principal banking centre in relation to the Available Currency. A reference to a business day in respect of more than one Available Currency is a reference to a day that is a business day in respect of each of the specified Available Currencies. CAD or Canadian Dollar means the lawful currency of Canada. Confirmation Advice means the written advice issued by HSBC as an acknowledgement of receipt to the Customer for each Investment accepted by HSBC. Currency Pair means the Base Currency and the Alternate Currency you select for an Investment. Customer and you means any person or corporation making an Investment and includes the Customer s successors and assigns. Where the Customer comprises two or more persons (persons to include individuals, associations, companies and partners of a named partnership): (i) (ii) (iii) (iv) (v) reference to the Customer shall be deemed to refer to all or any one or more of such persons, any act or omission of one shall be deemed the act or omission of them all, they shall be jointly and severally liable to HSBC for the obligations of the Customer under these Terms and Conditions, any communication required to be made to the Customer may be sent to the address last known to HSBC of any one or more of such persons, and any notice to be served on the Customer under these Terms and Conditions shall be validly served if served on any one of them. Where the Customer comprises a partnership, the expression shall include the person or persons from time to time carrying on the business of that partnership. Decision Rate means the Spot Rate at the Decision Time. The Decision Rate will be compared to the Strike Rate to determine whether HSBC must pay the Proceeds in the Base Currency or whether it may pay the Proceeds in the Alternate Currency. Delegate means you and any other person authorised by you and HSBC to use, to access and operate your Investment alone. Decision Time means 3:00pm (Tokyo time) two AUD Business Days before the Maturity Date. Dual Currency Investment, DCI or Investment means an investment described in this PDS and governed by the Terms and Conditions and the relevant Confirmation Advice. Early Termination means the termination of the Investment prior to the Maturity Date in accordance with clause 9 of the Terms and Conditions. Early Termination Event means any of the following events: (a) (b) (c) (d) (e) restrictions on convertibility and transferability are applied to any of the currencies in your Currency Pair; any currency (except Euro) in your Currency Pair ceases to be the official currency of its issuing nation or jurisdiction (as applicable); if one of the currencies in your Currency Pair is the Euro, and the Euro ceases to be the official currency of all member states in the European Economic and Monetary Union; if HSBC determines in good faith that the performance of its obligations under the Terms and Conditions has or will become in circumstances beyond the reasonable control of HSBC, impossible, unlawful, illegal or otherwise prohibited as a result of compliance with any applicable present or future law, rule, regulation, judgement, order or directive of any government, administrative, legislative or judicial authority or power; or any actual or proposed event that may reasonably (in HSBC s opinion) be expected to lead to any of the events referred to in paragraphs a. to d. above occurring. Early Withdrawal means the termination of the Investment prior to the Maturity Date at the request of a Customer in accordance with clause 8 of the Terms and Conditions. Electronic Communication means a message HSBC transmits to a Delegate and the Delegate receives from HSBC electronically, in a form that the Delegate can retain for later reference such as by printing or by storing for later display or listening. EUR or Euro means the lawful currency in the following 16 of the 27 member states of the European Economic and Monetary Union as of the date in this PDS: Austria, Belgium, Cyprus, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, Malta, Portugal, Slovakia, Slovenia, Spain and The Netherlands. Additional nations may adopt the Euro as its lawful currency after the date of this PDS and will it also be included under this definition. GBP or Pound Sterling means the lawful currency of the United Kingdom. HKD or Hong Kong Dollars means the lawful currency of Hong Kong. HSBC, we, us and our means HSBC Bank 22

25 Australia Limited ABN , AFSL HSBC Group means HSBC and all related bodies corporate. Investment Amount means the amount you select to invest in an Investment which will be debited by HSBC from your Base Currency account on the Start Date. Investment Parameters means the Base Currency; Alternate Currency; Investment Amount, Investment Term and Strike Rate selected by you for an Investment. Investment Rate means the rate, expressed as a percentage per annum offered by HSBC for each combination of Investment Parameters available for selection. The investment rate for a particular investment is set out in the Confirmation Advice. Investment Term means in relation to each Investment, the period from and including the Start Date to but excluding the Maturity Date. JPY or Japanese Yen means the lawful currency of Japan. Maturity Advice means the written advice issued by HSBC as an acknowledgement of the payment of the Proceeds for the relevant Investment. Maturity Date means the date on which the Proceeds of your Investment will be paid. The maturity date is set out in the Confirmation Advice and if such a date is not a Business Day in respect of each of the Base Currency, the Alternate Currency and USD, the maturity date will be the next Business Day in respect of each of the Base Currency, the Alternate Currency and USD. NZD or New Zealand Dollar means the lawful currency of New Zealand. Proceeds means your Investment Amount plus Return. Return for an Investment means the Investment Amount multiplied by the Investment Rate multiplied by the number of days in the Investment Term, divided by 365 or, where the Base Currency is USD, CAD, Euro or JPY, divided by 360. SGD or Singapore Dollar means the lawful currency of Singapore. Spot Rate at any time, means the prevailing exchange rate at that time between the Base Currency and Alternate Currency as quoted by HSBC. The Spot Rate is determined by market forces and may be constantly changing. Start Date means the first day of your Investment Term, which is normally two Business Days after the Trade Date. We will debit the Investment Amount from your nominated Base Currency account on the Start Date. Strike Rate means the exchange rate for your Currency Pair at which your Proceeds will be converted into the Alternate Currency by HSBC if your Base Currency has strengthened against the Alternate Currency to equal or beyond the Strike Rate at the Decision Time, HSBC may, at its discretion, convert your Proceeds to the Alternate Currency at the Strike Rate. The Strike Rate is selected by you and set out in your Confirmation Advice. Terms and Conditions means the Terms and Conditions of Investments set out in the section of this PDS headed Terms and Conditions as amended in accordance with a supplementary PDS. Trade Date means the day in which you confirm your Investment with HSBC. USD or U.S. Dollar means the lawful currency of the United States of America. 2. DUAL CURRENCY INVESTMENT You may offer to invest in an Investment by depositing cleared funds (unless HSBC agrees otherwise) in your nominated Base Currency account with HSBC and selecting your Investment Parameters. If your offer is accepted, HSBC will issue you with a Confirmation Advice as an acknowledgement of your Investment. Each Investment must not be less than the minimum amount of USD 50, (or otherwise agreed by HSBC or its equivalent in another Available Currency) or more than the maximum amount of USD 1,000, (or its equivalent in another Available Currency). Each Investment is an agreement between you and HSBC. The obligations of HSBC to you in respect of your Investment are separate and independent obligations governed by these conditions. The obligations are direct unsecured obligations of HSBC to you and do not constitute deposit liabilities of HSBC or a loan liability of HSBC to repay money loaned to it. You are not entitled to enforce Investments held by any other person or otherwise share in any of the benefits accruing to another person in connection with that other person s Investments. In consideration of HSBC agreeing to accept instructions from you by telephone, facsimile transmission or other electronic means, you agree to indemnify HSBC against any loss, claim, proceedings, damages, costs and expenses incurred or sustained by HSBC arising out of or in connection with the use of any telephonic, facsimile or other electronic communication. 3. JOINT ACCOUNTS Where an Investment is in the name of more than one person, the following applies: (a) (b) The Investment will be held jointly and all of you together have the right to the Proceeds; As the Proceeds may only be paid into your 23

26 (c) (d) 24 nominated Base Currency or Alternate Currency account with us, the nominated accounts must be in the same names as your Investment. Instructions in respect of the Investment may be given only in accordance with the election made by you when you opened your Base Currency and Alternate Currency accounts, except if we become aware of a dispute between you, we may decide not to accept instructions for the Investment until all of you have signed an authority for us to act; If one of you dies, we may treat the Investment as owned by the surviving Investment holder(s); and We can send notices, statements and other documents (including any notifying changes to the Terms and Conditions) by mailing them to any of you and they will be taken to have been given to all of you. 4. AUTHORISED SIGNATORIES You may give a person who is at least 18 years of age the authority to provide instructions for your Investment on your behalf as an Authorised Signatory. To do this you will need to sign the documentation we require and the Authorised Signatory must be present when entering into your Investment. Access to an Investment by an Authorised Signatory is subject to our requirements from time to time. All Authorised Signatories must be identified in accordance with the relevant legislation, regulations, guidelines, policies and procedures in force from time to time. You should ensure that any Authorised Signatory has read and understood the Terms and Conditions. If they do not comply with any of the Terms and Conditions, the result will be the same as if you had not complied. You must tell us in writing if you want to cancel the authority of an Authorised Signatory. You remain responsible for all transactions made by the Authorised Signatory until you have cancelled the authority in writing. 5. RETURN The Return on your Investment is calculated by multiplying the Investment Amount by the Investment Rate by the number of days in the Investment Term and dividing the product by 365 (or 360 if the Base Currency is USD, CAD, Euro or JPY). The Return will be paid or credited in full if you are an Australian resident for tax purposes and you have provided your tax file number or your ABN (if you have one) or you satisfy us that you have an exemption from doing so. Otherwise, we are required by law to deduct from any Return payment withholding tax calculated at the highest marginal tax rate plus the Medicare Levy. If you are not an Australian resident for tax purposes the withholding tax requirements will be different. We are required by law to deduct non-resident withholding tax from any Return payment. Please contact your tax adviser for details. We are required to report details of income earned, withholding tax deducted and tax file number quoted to the Australian Taxation Office. If the Australian Taxation Office instructs us to deduct an amount from your Return, we are obligated to do so. 6. INVESTMENT RATE The Investment Rate on your Investment will be the rate we advise you at the time you enter into your Investment and will be confirmed to you in your Confirmation Advice. The Investment Rate will be calculated by us by reference to your Investment Parameters, prevailing interest rates in both the currencies selected and the volatility of the exchange rate of your Currency Pair at the time you enter into your Investment. 7. PROCEEDS AT THE MATURITY DATE If your Investment is held until the Maturity Date, the Proceeds will be paid on the Maturity Date in either the Base Currency or the Alternate Currency. If the Base Currency has appreciated against the Alternate Currency, so that it is equal to or has moved beyond the Strike Rate at the Decision Time, HSBC will, either: (a) (b) convert your Proceeds to the Alternate Currency at the Strike Rate and credit the converted amount to your nominated Alternate Currency account with HSBC; or credit your Proceeds in the Base Currency to your nominated Base Currency account with HSBC. HSBC can choose which of (a) or (b) it will do in its own discretion. If the Base Currency has depreciated against the Alternate Currency, or the Base Currency has appreciated against the Alternate Currency but it is weaker than the Strike Rate at the Decision Time, your Proceeds will be paid to you in the Base Currency by crediting your nominated Base Currency account with HSBC. 8. ELECTRONIC COMMUNICATION 8.1 Where applicable to your Dual Currency Investment, HSBC may ask you to agree that HSBC may satisfy any requirements under the Terms and Conditions to provide you and any Delegate with information (including a written notice) by: (a) (b) Electronic Communication to an electronic address nominated by you or the Delegate; or making the information available at our website for retrieval by you or a Delegate (after notifying you or the Delegate by Electronic Communication to an electronic address nominated by you or the Delegate that the information is available for retrieval and the nature of the information and providing you or the Delegate with the ability to retrieve the information by Electronic

27 Communication). 8.2 If you agree: (a) (b) (c) (d) you will not receive paper copies of the relevant information, however HSBC may decide to send you information in paper copy where we deem it appropriate; you or the Delegate will need to regularly check to see if he or she has received any Electronic Communications from us; you or the Delegate will need to maintain and check his or her electronic address regularly to ensure it is always capable of receiving an Electronic Communication; and you or the Delegate will be responsible for printing or saving important information and we strongly recommend that you or a Delegate do so. 8.3 You may at any time by notice to HSBC terminate your agreement to receive information by Electronic Communication. 8.4 If you or the Delegate do not provide HSBC with a nominated address, you or the Delegate will receive notices by non-electronic means. 9. EARLY WITHDRAWAL The Investment may not be withdrawn prior to the Maturity Date without the consent of HSBC. Any request for Early Withdrawal must be in writing and be received before the Decision Time. HSBC may at its absolute discretion refuse to give such consent, or impose such conditions as HSBC may determine for the withdrawal of the Investment. If HSBC accepts your request for an Early Withdrawal, HSBC will pay you an amount equal to HSBC s determination (in a commercially reasonable manner) of the fair economic value of your Investment at the time your Early Withdrawal request is accepted, calculated taking into account any loss or costs that may be incurred by HSBC in unwinding its position prematurely. HSBC will pay you in the Base Currency unless for any reason HSBC considers that it is impossible or impractical to pay the proceeds of your Early Withdrawal in the Base Currency, in which case the proceeds will be paid in any other major currency selected by HSBC. 10. EARLY TERMINATION BY HSBC If an Early Termination Event occurs HSBC may terminate your Investment and pay you the Early Termination proceeds (calculated as your Investment Amount plus your accrued Return pro rated to reflect the portion of the Investment Term that has expired at the time of termination) in the Base Currency unless for any reason HSBC considers that it is impossible or impractical to pay the Early Termination proceeds in the Base Currency, in which case they will be paid in another currency selected by HSBC. 11. REPRESENTATIONS AND WARRANTIES Any Customer which is a body corporate hereby represents and warrants that it has authority and power to invest in Dual Currency Investment subject to these Terms and Conditions, that it has taken all necessary corporate steps to authorise the execution hereof and the terms hereof are legally binding upon it and are fully enforceable against it. 12. WAIVER No act or omission by HSBC shall affect its rights, powers or remedies hereunder or any further or other exercise of such rights, powers or remedies. 13. FORCE MAJEURE If HSBC is prevented from, hindered or delayed by reason of force majeure or act of state or other circumstances beyond the control of HSBC, in the performance of any of its obligations under these Terms and Conditions or the relevant Confirmation Advice, HSBC will not be under any liability to the Customer for any loss, damage, cost or expense incurred by the Customer due to the inability or failure of HSBC to perform any such obligation. 14. INVALIDITY, ILLEGALITY OR UNENFORCEABILITY In the event that any one or more of the provisions contained in these Terms and Conditions or the relevant Confirmation Advice should be held invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions hereof or thereof shall not in any way be affected or impaired thereby. 15. CONFIRMATION ADVICE The Confirmation Advice will be issued within 5 Australian Business Days of your Trade Date. The Confirmation Advice confirms your Investment Parameters and other relevant details. 16. MATURITY ADVICE The Maturity Advice will be issued within 2 days after the Maturity Date. The Maturity Advice confirms the currency and account to which HSBC will pay the Proceeds. 17. INCONSISTENCY Your Investment is governed by each of the following documents: a. this PDS booklet; b. your Confirmation Advice; and c. our separate booklet titled Personal financial services charges your guide. To the extent of any inconsistency between these documents, precedence shall be given in the order set out above. 25

28 18. LAW AND JURISDICTION This Agreement shall be subject to, governed by and construed in accordance with the laws of New South Wales and the parties submit to the non-exclusive jurisdiction of the New South Wales courts. 19. ANTI MONEY LAUNDERING AND COUNTER TERRORIST FINANCING (a) You acknowledge and agree that: (i) HSBC and other members of the HSBC Group are required to act in accordance with laws, regulations and requests of public and regulatory authorities operating in various jurisdictions which relate to, amongst other things: (A) (B) the prevention of money laundering, terrorist financing, tax evasion and the provision of financial and other services to persons or entities which may be subject to sanctions; or the investigation or prosecution of, or the enforcement against, any person for an offence against any laws or regulations (the Relevant Laws ); (ii) HSBC may take, and may instruct (or be instructed by) any other member of the HSBC Group to take, any action which it or such other member, in its sole and absolute discretion, considers appropriate to take, to comply with the Relevant Laws, and group policies relating to the Relevant Laws; (iii) such action may include but is not limited to: (A) (B) (C) (D) interception and/or investigation of any payment messages and other information or communications sent to or by you or on your behalf via the network and systems of HSBC or any other member of the HSBC Group; investigation of any application for a product or service, or drawdown or utilisation of a financing facility, by you; making further enquiries as to whether a name which might refer to a sanctioned person or entity actually refers to that person or entity; delaying, blocking or refusing: a. any payment; b. provision of any product or service; or c. drawdown or utilisation of any financing facility; and (E) giving any information about any transaction or activity to any person authorised under a Relevant Law or group (b) (c) policy relating to the Relevant Laws to receive that information; and (iv) third parties (including the governments of the United States of America or Australia and other governmental authorities) may also take action under the Relevant Laws. This may result in delays, blocking, seizure or confiscation of payments. Neither HSBC nor any member of the HSBC Group will be liable for loss (whether direct or consequential and including without limitation loss of profit or interest) or damage suffered by any party, arising out of: (i) any delay or failure by HSBC, or any member of the HSBC Group, in: (A) processing any payment messages, information or communications; (B) (C) (D) performing any of its duties or other obligations in connection with any nominated account; providing any product or service to any person; or effecting a drawdown or utilisation of any financing facility, caused in whole or in part by any steps taken by HSBC or such other member of the HSBC Group, in its sole and absolute discretion, considers appropriate to take in accordance with the Relevant Laws and group policies in relation to the Relevant Laws; or (ii) the exercise of any of HSBC s rights under this clause; or (iii) any action taken by third parties in connection with the Relevant Laws. You further acknowledge and agree that: (i) you do not acquire services from HSBC, or any member of the HSBC Group under an assumed name; (ii) any services HSBC, or any member of the HSBC Group may provide will not be used in relation to any criminal activities; (iii) if HSBC, or any member of the HSBC Group asks, you will provide HSBC with additional information HSBC reasonably requires for the purposes of Relevant Laws; (iv) HSBC, or any member of the HSBC Group may obtain information about you from third parties if HSBC believes this is necessary to comply with Relevant Laws; (v) in certain circumstances, the action taken by HSBC, a member of the HSBC Group or a 26

29 third party may prevent or cause a delay in the processing of certain information; and (vi) neither HSBC nor any member of the HSBC Group warrants that any information on the systems of HSBC or any member of the HSBC Group relating to any payment message or other information or communications which are the subject of any action taken pursuant to this clause is accurate, current or up-to-date at the time it is accessed, whilst such action is being taken. 20. YOUR CONFIDENTIAL AND PERSONAL INFORMATION HSBC collects your information in order to comply with laws, regulations and policies applicable to HSBC and to consider whether to provide you with any product or service (Services). Your failure to supply your information to HSBC may result in HSBC being unable to provide any Services to you. Once collected: (a) (b) HSBC may use your information for any and all purposes in connection with: (i) the provision, and daily operation, of the Service; (ii) the processing of data; (iii) internal operational requirements of HSBC or the HSBC Group (such as risk management, staff training, system or product development, survey and research); (iv) compliance by HSBC, or a member of the HSBC Group, with anti-money laundering and counter terrorist financing laws in Australia or another country; (v) prevention and/or investigation of actual or suspected crime or fraud; (vi) compliance with disclosure requirements under any law binding on HSBC or any member of the HSBC Group; (vii) matching, for whatever purpose your information with other data in the possession of HSBC or the HSBC Group; (viii) collection of amounts outstanding from any party; (ix) requirements under any laws, regulations, codes and external systems relevant to the Service; and (x) marketing, promoting, improving and developing any Service by HSBC and any other member of the HSBC Group to you generally; HSBC may disclose your information to parties (within or outside Australia) including but not limited to the following: (c) (d) (e) (i) other members of the HSBC Group; (ii) external service providers to HSBC or the HSBC Group; (iii) such parties as may be necessary for the provision of the Service to you; (iv) any person acting on your behalf; (v) beneficiaries of payments; (vi) any transaction party; (vii) alliance partners of HSBC or any member of the HSBC Group; (viii) other financial institutions; (ix) any party involved in the acquiring of interest or assuming risk in the Service provided to you; and (x) regulatory bodies, government agencies, law enforcement bodies and courts; you may request that your information not be used for direct marketing purposes; you have a right to request access to your information. A fee may apply. HSBC will comply with such request unless it may or is required to refuse to do so under any applicable laws or regulations; and if at any time your details have changed or you would require access to your information, you may contact the: Privacy Officer HSBC Bank Australia Limited GPO Box 5302 Sydney NSW If you give HSBC personal information about another person or you direct another person to give their personal information to HSBC, you must tell that person that: (a) (b) (c) (d) (e) HSBC is holding personal information about them; personal information collected about them will be used for the purposes of HSBC and/or any member of the HSBC Group dealing with you and/or providing services to you; HSBC may also give their information to any HSBC Group member or other third parties for such purposes; if that person fails to provide their personal information to HSBC and does not agree to the use or disclosure of their information as set out above, HSBC may not be able to provide a Service to you; collection of some of the information about them may be a requirement under laws or regulations applicable to HSBC or any member of the HSBC Group; and 27

30 (f) they can access their information by contacting: The Privacy Officer HSBC Bank Australia Limited GPO Box 5302 Sydney NSW A fee may apply. HSBC will comply with such requests unless we may or we are required to refuse to do so under any applicable laws or regulations. Being a global organisation, the HSBC Group leverages its global synergies in providing products, or services to you. Whether it is used, stored or processed in Australia or elsewhere, the customer information will be protected by strict confidentiality and security, of which all HSBC Group members, their staff and any third party service providers, agents, or contractors are subject and will only be used in accordance with our instructions unless otherwise required or allowed by law or any governmental agency or regulatory agency or authority or for the purpose of preventing or detecting fraud or other violations or suspected violations of the law. As such, HSBC may disclose your customer information to members of the HSBC Group located overseas in countries where we operate. A list of these countries can be found on Our Website and may be updated from time to time. If you apply for, or we provide you with, a product or service, you consent to the disclosure of your customer information to our offshore HSBC Group entities. Such HSBC Group entities will manage your personal information in accordance with strict confidentiality and security requirements which are designed in compliance with the United Kingdom s Data Protection Act 1999 (UK), whose privacy standards are comparable with the Australian privacy legislation. For this reason, we will not have to take such steps as are reasonable in the circumstances to ensure that our group comply with the Australian Privacy Principles. To find out more about our handling of Personal Information please refer to our Privacy Policy which is available on Our Website, in branch or on request to the Privacy Officer, HSBC Bank Australia Limited, GPO Box 5302, Sydney, NSW, Our Privacy Policy contains information on how you may access and correct your customer information and how you can make a complaint in relation to your Personal Information. SCHEDULE A - COLLECTION AND USE OF CUSTOMER INFORMATION - TERMS AND CONDITIONS DEFINITIONS Capitalised terms used in this clause shall have the following meanings: Authorities includes any judicial, administrative, public or regulatory body, any government, any Tax Authority, securities or futures exchange, court, central bank or law enforcement body, or any of their agents with jurisdiction over any part of the HSBC Group. Compliance Obligations means obligations of the HSBC Group to comply with: (a) Laws or international guidance and internal policies or procedures, (b) any demand from Authorities or reporting, disclosure or other obligations under Laws, and (c) Laws requiring us to verify the identity of our customers. Connected Person means a person or entity (other than you) whose information (including Personal Data or Tax Information) you provide, or which is provided on your behalf, to any member of the HSBC Group or which is otherwise received by any member of the HSBC Group in connection with the provision of the Services. A Connected Person may include, but is not limited to, any guarantor, a director or officer of a company, partners or members of a partnership, any substantial owner, controlling person, or beneficial owner, trustee, settler or protector of a trust, account holder of a designated account, payee of a designated payment, your representative, agent or nominee, or any other persons or entities with whom you have a relationship that is relevant to your relationship with the HSBC Group. Controlling persons means individuals who exercise control over an entity. For a trust, these are the settler, the trustees, the protector, the beneficiaries or class of beneficiaries, and anybody else who exercises ultimate effective control over the trust, and for entities other than a trust, these are persons in equivalent or similar positions of control. Customer Information means your Personal Data, confidential information, and/or Tax Information or that of a Connected Person. Financial Crime means money laundering, terrorist financing, bribery, corruption, tax evasion, fraud, evasion of economic or trade sanctions, and/or any acts or attempts to circumvent or violate any Laws relating to these matters. We, our and us refer to HSBC Bank Australia Limited HSBC Group means HSBC Holdings plc, its affiliates, subsidiaries, associated entities and any of their branches and offices (together or individually), and member of the HSBC Group has the same meaning. Laws include any local or foreign law, regulation, judgment or court order, voluntary code, sanctions regime, agreement between any member of the HSBC Group and an Authority, or agreement or treaty between Authorities and applicable to HSBC or a member of the HSBC Group. Personal Data means any information relating to an individual (and corporate entities, in those countries where data privacy law applies to corporates), from which they can be identified. Services includes (a) the opening, maintaining and closing of your bank accounts, (b) providing you with credit facilities and other banking products and services, processing applications, credit and eligibility assessment, 28

31 and (c) maintaining our overall relationship with you, including marketing services or products to you, market research, insurance, audit and administrative purposes. Substantial owners means any individuals entitled to more than 10% of the profits of or with an interest of more than 10% in an entity either directly or indirectly. Tax Authorities means UK or foreign tax, revenue or monetary authorities (for example, Her Majesty s Revenue and Customs). Tax Certification Forms means any forms or other documentation as may be issued or required by a Tax Authority or by us from time to time to confirm your tax status or the tax status of a Connected Person. Tax Information means documentation or information about your tax status and the tax status of any owner, controlling person, substantial owner or beneficial owner. Reference to the singular includes the plural (and vice versa). 1. COLLECTION, PROCESSING AND SHARING OF CUSTOMER INFORMATION These clauses 1-5 explain how we will use your information and that of Connected Persons. By using the Services, you agree that we and members of the HSBC Group shall use Customer Information in accordance with such clauses. Customer Information will not be disclosed to anyone (including other members of the HSBC Group), other than where: We are legally required to disclose; We have a public duty to disclose; Our [or a third party s] legitimate business purposes require disclosure; The disclosure is made with your consent; or It is disclosed as set out in this clause. COLLECTION 1.1 We and other members of the HSBC Group may collect, use and share Customer Information (including relevant information about you, your transactions, your use of our products and services, and your relationships with the HSBC Group). Customer Information may be requested by us or on our behalf or that of the HSBC Group, and may be collected from you directly, from a person acting on your behalf, from other sources (including from publicly available information), and it may be generated or combined with other information available to us or any member of the HSBC Group. PROCESSING 1.2 Customer Information will be processed, transferred and disclosed by us and/or members of the HSBC Group in connection with the following Purposes: (a) the provision of Services and to approve, manage, administer or effect any transactions that you request or authorise, SHARING (b) meeting Compliance Obligations, (c) conducting Financial Crime Risk Management Activity, (d) collecting any amounts due and outstanding from you, (e) conducting credit checks and obtaining or providing credit references, (f) enforcing or defending our rights, or those of a member of the HSBC Group, (g) for our internal operational requirements or those of the HSBC Group (including credit and risk management, system or product development and planning, insurance, audit and administrative purposes), (h) maintaining our overall relationship with you (including marketing or promoting financial services or related products and market research), and/or (i) for those other purposes mentioned in HSBC s Privacy policy, Privacy Consent and declarations and elsewhere in these terms and conditions (the Purposes ). 1.3 By using the Services, you agree that we may, as necessary and appropriate for the Purposes, transfer and disclose any Customer Information to the following recipients globally (who may also process, transfer and disclose such Customer Information for the Purposes): (a) any member of the HSBC Group; (b) any sub-contractors, agents, service providers, or associates of the HSBC Group (including their employees, directors and officers); (c) any Authorities, in response to their requests; (d) persons acting on your behalf, payment recipients, beneficiaries, account nominees, intermediary, correspondent and agent banks, clearing houses, clearing or settlement systems, market counterparties, upstream withholding agents, swap or trade repositories, stock exchanges, companies in which you have an interest in securities (where such securities are held by us for you); (e) any party to a transaction acquiring interest in, or assuming risk in, or in connection with, the Services; (f) other financial institutions, credit reference agencies or credit bureaus, for the purposes of obtaining or providing credit references; (g) any third party fund manager who provides asset management services to you; (h) any introducing broker to whom we provide 29

32 introductions or referrals; (i) in connection with any HSBC business transfer, disposal, merger or acquisition; (j) for those other purposes mentioned in HSBC s Privacy policy, Privacy Consent and declarations. and elsewhere in these terms and conditions. Wherever located, including in jurisdictions which do not have data protection laws that provide the same level of protection as the jurisdiction in which the Services are supplied. YOUR OBLIGATIONS 1.4 You agree to inform us promptly, and in any event, within 30 days in writing if there are any changes to Customer Information supplied to us or a member of the HSBC Group from time to time, and to respond promptly to any request from us or a member of the HSBC Group. 1.5 You confirm that every Connected Person/person whose information (including Personal Data or Tax Information) you have provided to us or a member of the HSBC Group has (or will at the relevant time have) been notified of and agreed to the processing, disclosure and transfer of their information as set out in these Terms. You shall advise such individuals that they have rights of access to, and correction of, their Personal Data. 1.6 Where: you fail to provide promptly Customer Information that we reasonably requested, or you withhold or withdraw any consents that we may need to process, transfer or disclose Customer Information for the Purposes (except for purposes connected with marketing or promoting products and services to you), or we have, or a member of the HSBC Group has, suspicions regarding Financial Crime or an associated risk, We may: (a) be unable to provide new, or continue to provide all or part of the, Services to you [and reserve the right to terminate our relationship with you]; (b) take actions necessary for us or a member of the HSBC Group to meet the Compliance Obligations; and/or (c) block, transfer or close your account(s) where permitted under local Laws. In addition, if you fail to supply promptly your, or a Connected Person s, Tax Information and accompanying statements, waivers and consents, as may be requested, then we may make our own judgment with respect to your status, including whether you are reportable to a Tax Authority, and may require us or other persons to withhold amounts as may be legally required by any Tax Authority and paying such amounts to the appropriate Tax Authority. 2. DATA PROTECTION 2.1 Whether it is processed in a home jurisdiction or overseas, in accordance with data protection legislation, Customer Information will be protected by a strict code of secrecy and security which all members of the HSBC Group, their staff and third parties are subject to. 2.2 Under relevant data protection legislation, you have the right to request copies of certain categories of Personal Data which may be held and to request that any errors in such data are corrected. 3. FINANCIAL CRIME RISK MANAGEMENT ACTIVITY 3.1 We, and members of the HSBC Group, are required, and may take any action to meet Compliance Obligations relating to or in connection with the detection, investigation and prevention of Financial Crime ( Financial Crime Risk Management Activity ). Such action may include, but is not limited to: (a) screening, intercepting and investigating any instruction, communication, drawdown request, application for Services, or any payment sent to or by you, or on your behalf, (b) investigating the source of or intended recipient of funds (c) combining Customer Information with other related information in the possession of the HSBC Group, and/or (d) making further enquiries as to the status of a person or entity, whether they are subject to a sanctions regime, or confirming your identity and status. 3.2 Exceptionally, our Financial Crime Risk Management Activity may lead to us delaying, blocking or refusing the making or clearing of any payment, the processing of your instructions or application for Services or the provision of all or part of the Services. To the extent permissible by law, neither we nor any other member of HSBC Group shall be liable to you or any third party in respect of any loss (however it arose) that was suffered or incurred by you or a third party, caused in whole or in part in connection with the undertaking of Financial Crime Risk Management Activity. 4. TAX COMPLIANCE You acknowledge that you are solely responsible for understanding and complying with your tax obligations (including but not limited to, tax payment or filing of returns or other required documentation relating to the payment of all relevant taxes) in all jurisdictions in which those obligations arise and relating to the opening and use of account(s) and/or Services provided by us and/or members of the HSBC Group. Each Connected Person acting in their capacity as a Connected Person (and not in their personal capacity) also makes the same acknowledgement in their own regard. Certain countries may have tax legislation with extra-territorial effect regardless of your or Connected Person s place of domicile, residence, citizenship or incorporation. Neither we nor any member of the HSBC Group provide tax advice. You are advised to seek independent legal and/or tax advice. Neither we 30

33 nor any member of the HSBC Group have responsibility in respect of your tax obligations in any jurisdiction which they may arise including any that may relate specifically to the opening and use of account(s) and/or Services provided by us and/or members of the HSBC Group. 5. MISCELLANEOUS 5.1 In the event of any conflict or inconsistency between any of these Terms and those in any other service, product, business relationship, account or agreement between you and us, these Terms shall prevail. Any consents, authorisations, HSBC requested waivers and permissions that already exist from you in relation to Customer Information shall continue to apply in full force and effect, to the extent permissible by applicable local law. 5.2 If all or any part of the provisions of these Terms become illegal, invalid or unenforceable in any respect under the law of any jurisdiction, that shall not affect or impair the legality, validity or enforceability of such provision in any other jurisdictions or the remainder of these Terms in that jurisdiction. 6. SURVIVAL UPON TERMINATION These Terms shall continue to apply notwithstanding their termination, any termination by us or a member of the HSBC Group of the provision of any Services to you or the closure of any account. How to fill in the Application Form APPLICANT(S) DETAILS Under Type of Applicant, tick the box which applies to you. Enter your full name. Up to two individual names can be entered. As you are an existing customer of HSBC, please provide your HSBC Customer number. If you are applying as a company, please provide the full company name and ABN. Tick the Internet Banking box if you wish to view your Investment details on our Internet Banking Service. your application. However, tax may be deducted from any payment to you at the highest marginal rate plus Medicare levy if a TFN or an ABN is not provided or you do not fall within an applicable exemption. SUITABILITY CHECKLIST The Investment is linked to the performance of the foreign exchange market. There are risks and characteristics associated with the Investment that may not suit all investors. To satisfy our suitability requirements, please ensure that each item on the checklist applies to you. Initial each item to confirm its suitability, otherwise your application will not be accepted. INVESTOR DECLARATIONS Please ensure that you read, understand and accept the Investor Declarations before signing and dating the Application Form. Financial Services Guide ABOUT THIS FINANCIAL SERVICES GUIDE (FSG) This FSG is designed to help you to decide whether to use any of the financial services which HSBC offers in it. It contains information about: (a) how our employees are remunerated in relation. to those services; and (b) how complaints are dealt with. ABOUT US AND THE FINANCIAL SERVICES WE PROVIDE Our contact details are shown on the inside front cover. We are authorised to do the following in relation to Dual Currency Investments open (i.e. issue), vary and close (i.e. dispose of) Accounts. REMUNERATION Our employees receive a base salary and may be eligible for annual or other performance bonuses or rewards which may take into account the sales and referrals they make. CHANGED DETAILS If you have recently changed your name, address, telephone numbers, address, etc and have not advised HSBC of these changes, please update your details in this section. TAX FILE NUMBER OR EXEMPTION CATEGORY If you are an Individual, please enter your Tax File Number (TFN) or an exemption category. Where there is more than one of you, please enter the TFN for each applicant. Collection of TFN(s) is authorised by taxation laws. Quotation of TFN(s) is not compulsory and will not affect 31

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35 Dual Currency Investment Application Form Complete the form using a BLACK PEN and print in clear CAPITAL LETTERS This is an Application Form for the Dual Currency Investment under the offer set out in the PDS. To complete a Dual Currency Investment Application Form, you must have an HSBC account in one or more of the Available Currencies. To enter into an Investment, you must have an HSBC account in both the Base Currency and the Alternate Currency you select for the Investment. If you do not have an account in one of the Available Currencies, you may open an account by visiting your nearest HSBC branch or calling the DCI Team on If you are in doubt as to how to complete this Application Form, please contact your accountant, lawyer or other professional adviser. The PDS contains information relevant to your decision to invest in the Investment and you should read the entire PDS carefully before applying. Please refer to page 28 of the PDS for instructions on how to complete this Application Form. After you complete this Application Form, please return it to your nearest HSBC branch or mail it to: HSBC Bank Australia Limited DCI Team PO Box 3096 Parramatta NSW 2124 Issued by HSBC Bank Australia Limited AFSL No: Do you have multiple nationalities? No Yes Nationality 2 Nationality 3 Are you a resident of Australia for tax puroses? Yes No Specify country of residence for tax purposes OR Legal Name of Entity Trading Name As Trustee For Other Registered Number Country of Incorporation Applicant 2 Customer number (9 digits) APPLICATION(S) DETAILS Type of applicant Title Given name Individual Sole Trader Trustee Company address Joint Individuals Partnership Self Managed Superannuation Fund Middle name Surname Nationality I/We agree to HSBC sending Electronic Communication to my/ our electronic equipment, electronic address, and making information available on HSBC s website as outlined in the Dual Currency Investment PDS Terms and Conditions under the heading Electronic Communications. I/We have understood the implications of electing this method of communication. Do you want to view your Investment details on our Internet Banking Service? No Applicant 1 Yes Customer number (9 digits) Do you have multiple nationalities? No Yes Nationality 2 CHANGED DETAILS Nationality 3 If your contact details have recently changed and you have not advised HSBC, please give your new details below. Please ensure you provide the required certified identification documentation, please refer to your nearest HSBC branch or call the DCI Team on Permanent Residential Address/Registered Address (cannot be a PO Box) Title Given name Middle name Postcode Surname Nationality Country (if not Australia) At this address since / / Issued by HSBC Bank Australia Limited ABN AFSL HBAA015PDS (R7) 06/14 Page 1 of 3

36 Current Residential Address/Principle Place of Business (if different from Permanent Residential Address/Registered Address) Country (if not Australia) At this address since / / Postcode Previous address (no PO Box, if less than 3 years at your permanent residential address Country (if not Australia) Phone number Other Postcode Mobile number TAX FILE NUMBER OR EXEMPTION CATEGORY Collection of TFN(s) is authorised by taxation laws. Quotation is not compulsory and will not affect your application. However tax may be deducted from any payments to you at the highest marginal rate plus Medicare levy if a TFN or ABN is not provided or you do not fall within an applicable exemption. Applicant 1 Applicant 2 INVESTOR ACKNOWLEDGMENT The Investment is linked to the performance and risks of the foreign exchange market. It might be suitable for investors to whom the following statements apply: To indicate your understanding of this product all items must be initialled for HSBC to accept your application. I/We acknowledge the Investment has foreign exchange risk. I/We understand that the Proceeds may be converted into the Alternate Currency at the Strike Rate which I/we agree to at the time of entering into the Investment. I/We understand that if my/our Base Currency appreciates against my/our Alternate Currency beyond the Strike Rate, I/we might make a loss on my/our Investment. I/We understand that if my/our Base Currency depreciates against my/our Alternate Currency, it might be possible for me/us to generate a better return by investing directly in the Alternate Currency. I/We understand the impact of exchange rate fluctuations on the investment. I/We understand that the Proceeds will be paid in either the Base Currency or the Alternate Currency on the Maturity Date. I/We have an understanding of how foreign exchange markets work. I/We consider the Investment is suitable to my/our investment objectives having regard to my/our investment objectives, financial situation and needs. I/We understand the investment is designed to be held until maturity, and should I/we need to terminate my/our investment early there may be break costs applicable. INVESTOR DECLARATION By signing this Application Form: I/We confirm that: I/we have received the offer to subscribe for the Investment, and the PDS (electronically or otherwise). I/we have received, read and understood the PDS and the declarations in this Application Form before I/we complete this Application Form. by signing this Application Form and submitting it to HSBC, I/we agree to be bound by the Terms and Conditions contained in the PDS and make the declarations contained in this Application Form. I/we agree to indemnify HSBC and any of its related bodies corporate against any loss, liability, damages, claim, cost or expense incurred as a result, directly or indirectly, of any declarations proving to be incorrect or untrue. where I am/we are natural person(s), I am/we are at least 18 years of age and not under any legal disability preventing me/us from applying for the Investment. where I am/we are applying for the Investment as trustee of a trust, I/we have all the power, authority and discretion vested as trustee to apply for and hold the Investment. I/we have considered and determined that the Investment is suitable to my/our investment objectives, financial situation and needs based on, among other things, the items set out in the SUITABILITY CHECKLIST section. I/We acknowledge that: once submitted, I/we cannot withdraw my/our application unless HSBC agrees. the acceptance of my/our application will be at the discretion of HSBC, which has the right to refuse my/our application. the information contained in the PDS is not investment advice nor a recommendation that the Investment suits my individual/our collective investment objectives, financial situation or other specific needs and I believe the Investment is suitable for my needs based on the selected statements in the Suitability Checklist. neither HSBC nor any of its related bodies corporate have provided any tax advice or otherwise made any representations regarding the tax consequences of my/ our application to purchase the Investment and to the extent that I/we require, I/we have or will obtain my/our own financial and taxation advice from an independent professional adviser. I/we waive the right and agree not to make any claim against HSBC or any of its related bodies corporate with respect to tax aspects of the Investment. the Investment is not a deposit. The Investment may be subject to foreign exchange risk, including possible loss of the Investment Amount. I/we have read and understood the section Your Confidential and Personal Information in the PDS and agree that information about me/us in this Application Form will not be collected, used or disclosed for any purpose other than for the purposes stated in the PDS. Where I/we provided information about any other individual, I/we will make that individual aware of the Your Confidential and Personal Information provisions. I/we have consented to members of the HSBC Group contacting me/us from time to time with various product Issued by HSBC Bank Australia Limited ABN AFSL HBAA015PDS (R7) 06/14 Page 2 of 3

37 offers and special promotions via mail, or telephone. This consent is effective until I/we withdraw it by contacting HSBC by telephoning or writing to HSBC Bank Australia Limited, Marketing Department, GPO Box 5302 Sydney NSW neither HSBC, nor any of its related bodies corporate, guarantee the performance of the Investment, or whether the Proceeds will be paid in the Base Currency. None of HSBC s related bodies corporate will repay your Investment Amount. AUTHORISATION Where this Application Form is executed by an attorney, then by signing this Application Form, the attorney represents and warrants that they have not received any notice of revocation of the relevant Power of Attorney under which this Application Form is signed (whether by death of the grantor or otherwise). If you are signing on behalf of a company then you do so pursuant to s127(1) of the Corporations Act 2001 (Cth). Applicant 1 / Authorised Signatory 1 Full name / Name of authorised signatory in full (please print) Signature Date / / Applicant 2 / Authorised Signatory 2 Full name / Name of authorised signatory in full (please print) Office / Title Signature Date / / CHECKLIST I/We have completed and signed the Application Form I/We have completed the SUITABILITY CHECKLIST section of this Application Form BANK USE ONLY Additional comments USP checked C11 checked C35 checked FTRA checked PEP checked SCC/FCCRM Yes No Note: Approval required if Yes Applicant number 1 Applicant number 2 Branch name Staff name Officer code Branch ext. Authorised Signature Issued by HSBC Bank Australia Limited ABN AFSL HBAA015PDS (R7) 06/14 Page 3 of 3

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40 Issued by HSBC Bank Australia Limited ABN AFSL/ACL No Effective 12 March 2014 HBAA015PDS (R7) 0614