Countdown to quantos
China Everbright Bank launched a new dual-currency deposit linked to the renminbi/US dollar exchange rate a day after the revaluation on July 21. Is the market ripe for more renminbi structured products? Jill Wong reports
Structured deposits in foreign currencies have been hugely popular in China. Range accruals, trigger swaps, cancellable swaps and currency baskets have dominated sales in retail and wealth management. Their popularity is due to their attractive returns over bank deposits, with retail products combining capital protection and yield enhancement.
Typically, the products are simple US dollar deposits with enhanced deposit rates if a certain exchange rate, such as dollar/euro, stays within
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