It only applied on new fund bring in to the banks aka transfer money from others to theirs. Existing money in the banks won't be able to enjoy higher rate.

Mostly and generally when banks offer higher rate than normal, they want fresh fund and new customers.

For UOB higher offer, you need to park 2,000 in saving account or open one (if don't have), before can enjoy the higher rate which is part of its T&C. Details can get from the brochure. My above statement is not absolute, check with their RM.

Cheers.

This post has been edited by cherroy: Jun 16 2008, 09:05 PM

Is blar blar blar lah, not bra bra bra, <--- otherwise people think 'senget' already. Haha, just joking.

To add a point,

For those want to invest in DCI, mostly people already opt for to keep foreign currency FD one in the first place, so any converted currency is kept in foreign currency account/FD to take advantage of the higher yield compared to RM. That's why AUD and NZD are two most popular at the moment.

It is plain not wise to convert back as your case mentioned. If one doesn't intend to keep the foreign currency (if converted), then DCI is not a very good place to play with.

Nowadays, foreign currency FD is quite popular as people see it a way to diversify their asset particularly hedge against RM risk.

This post has been edited by cherroy: Jun 17 2008, 03:48 PM

Yes, no doubt about it.
But I still see it is one of the good option for investment mainly because I did suffer because RM depreciation in 1997 crisis. A lot of people experienced the pain of 1997 will be more towards to hedge against RM risk which prior 1997, people have no awareness of it.

I don't see RM is or will be a strong currency for near future unless gov improve their budget deficit situation and sort out economy problems. Don't get me wrong, I don't said or see Rm will collapse either, just for diverisification purpose and spread the risk.

But I do agree, it is not wise to chase blindly for the high yield offered by the DCI. If want to invest in DCI, the first mind is to keep the targetted currency. If one doesn't want to keep one and will convert back (if converted), then DCI is not a right place to be.

This post has been edited by cherroy: Jun 17 2008, 04:06 PM

Yes, those converted currency can be put in Foreign currency FD account, for sure. You can also get or buy a remittance from the currency (for those want to send it to overseas), or if you wish to put in other banks forex account.
Nobody or less people want to take as cash, because normally for DCI minimum amount is 250K (for most banks), so you want to take 250k in cash?

For sure, it is UT + FD. You need to put 1: 1 ratio before it can give you that rate. Citi also has it, last time around.

Actually, if one calculated carefully, there is nothing to shout about as it is 33% pa for 1 month only and one off. 33% pa for 1 month translate into 2.75% only. On UT side, they are charging you 5% already. They still have 2.25% gain on their side.

For UT, one can get discount on commission normally if sum is relatively large (so far I encounter all major fund houses can give up to 2.xx% to 3% except PB and PM funds).

As it is possibe to reduce the commission charge from normally 5% to 2.xx% if one put relatively large sum in it. So this promotion is like, instead giving out discount on UT, they bundle it with FD, so no discount on commission on UT, but give you in the FD interest, which is good on their headlines advertising. In fact, it might be as same as getting discount on UT purchased.

This post has been edited by cherroy: Jun 20 2008, 11:18 AM

I think you are confuse already.
For forex FD, it work like that.

30K RM -> 10K AUD

10K AUD get 7% interest (if interest is 7%), and auto renew until you want to cancel it, just like normal FD.

You 10K AUD will continue to grow (+ interest).

If you disregard the exchange rate then your 10K will grow as same as your RM FD.

So capital + interest rate in AUD is guaranteed.

But if you want change back to RM then different story, it depends of AUD rate with RM already, might lose some or gain more depend on the exchange rate between you entry rate and exist rate

No, only is the spread of exhange rate.

Forex FD is meant for long term and asset diversification. You don't go in and out frequently as you might lose the exhange rate spread, although it might gain also if the particular currency appreciate.

Yes, so basically one gain arond 30 -40 cents from the AUD FD, translate ito around 15% while getting higher interest rate around 7%. So total gain compared to RM FD would be 15% + (7 - 3.7%, RM FD) + (interest rate x 15% gain on forex).

But if AUD is going down, then might be no gain and can be resulting in losses especially if one put in USD 2 years ago.

This post has been edited by cherroy: Jun 23 2008, 12:29 PM

One can ask for commission reduction aka the discount from the counter rate qouted if amount is substantial, like 30-50K and above.
Or
one can opt for DCI in order to convert at spot rate or more attractive rate.

Purely speculate on higher interest rate alone while not wish currency being converted or hold the particular currency, the foreign currency account/FD might not a good place to 'play with'. The main purposes of those foreign currency FD/account is meant for asset diversification and hedge against RM risk.

This post has been edited by cherroy: Jun 23 2008, 05:46 PM

Don't need to go through lah,

The 33% one month FD, surely (99%) is 1:1 ratio of UT + FD condition. Want to bet? , 1 cup of teh tarik?

In Malaysia, most online service suck big time, people or lot of company don't pay serious attention on online stuff, most of emails won't get replied even you ask them in email form and seldom update on times, except a few.

This post has been edited by cherroy: Jun 23 2008, 08:43 PM

I had posted once before, check it out. If you dump 50K, then 25K wil go to UT and other half 25K will go to 1 month FD of 33% pa that is not renewable, upon maturity of 1 month FD, the rate will back to normal rate, so you 'enjoy' 1 month only.

It is not as attractive as you think. See my below post.

This post has been edited by cherroy: Jun 23 2008, 08:50 PM

For sure, yes, the 1 month FD will be automatic renewed also generally, but only 3% (normal rate)


This post has been edited by cherroy: Jun 23 2008, 09:47 PM

For foreign currency FD, there are plenty of posts discuss about pros and cons about it, check it out.

If you think RM will depreciate against the targettd currency in the future then foreign FD is the place to be, yes, quite correct. You hedge against RM risk but also you exposure to the risk of the targeted currency depreciation. So it works both way so net gain or loss depends on the currency movement.


Yes, that's why it is meant for long term, one only will see the real and net effect over the long term. Short term wise, it is not advisable unless RM does depreciate significantly in short term. But currency market seldom move that big in short period of time, long term, yes, it depends on the particular currency country economy. Like Euro has risen from 3.6 to now 5.1 against RM since Euro started, or AUD has risen from 2.7 to now 3.1 in less than 2-3 years time.

One thing, commission or spread is not as high as that (3.58%), one can get discount on the counter published rate, just like counter rate today form UOB is 2.5150 2.4340, so spread is 3.3%, but if you are investing RM 50K, it is quite norm and possible to get a rate like 2.5050 or something lower eventually below 3%.

Also DCI is also a place that can do conversion to put in foreign currency FD which enable one to convert at much better rate.

Yup, it is plain not wise if one first/initial intention is only want to put 1 month FD in NZD to get the 8.3%, then convert back to RM after the maturity.

Any FC FD can be auto-renew until you wish.

Promotion rate is one off, (bank uses to lure new customers in only), those renew FD will be according at the previaling counter rate at that time. NZD current over night interest rate is 8.25%. So banks can offer more than that, as it will mean losses for them. (Banks won't stupid to make losing business one).

11.18% is one month and one off for new fund/new customer only, which translate into pa., just a little bit only. Instead spend money on advertisement/hiring people to get new customer and new money into their banks, they offer customers a bit, so still no loss for them. As the spread of counter rate 2.xx% is enough to cover those extra interest given.

Yes, interest on more than 100K per deposit is subjected to witholding tax.

It depended on the financial environmental at time being.

For the last few years, no. In fact those with more than 1 millions FD asset on certain bank, they classified at Tier 2 which getting slight lower than normal interest rate. Because banks are too 'full' with money for the last few years.

Now situation is better.

Because people don't understand what you mean by "which FD".

FD is FD, the different is only which bank do you put in, how long duration and interest rate only. Interest rate is similar across, merely 0.1-0.2% different between some banks.

---

Added on September 21, 2008, 7:15 pmPlease don't mislead others, this is FD thread, not related to insurance.

Insurance and FD is different.

This post has been edited by cherroy: Sep 21 2008, 07:15 PM

Not exactly correct. You can withdraw in the form of foreign currency as well in the form of remittance ie if you put in AUD then you can wihdraw in AUD in the form of remittance and send it to Australia for whatever purposes or TT to elsewhere.

Yes, it is safe, (not save).

BNM/PIDM has guaranteed all deposits in Malaysia banks until Dec 2010.

FYI, Citibank, Standard Chartered, UOB in Malaysia and other foreign banks here are considered Malaysia based banks. They are incoporated in Malaysia, although their mother company is at overseas. They are separated entity in term of company wise.