Gold Account Principal Brochure

Transcription

1 Gold Account Principal Brochure The Gold Account allows you to trade paper gold in taels through BEA, a licenced bank regulated by the Hong Kong Monetary Authority. This is not a time deposit and is not a principal protected investment.

2 Important Risk Warnings Gold Account Gold Account is a paper gold scheme offered by The Bank of East Asia, Limited ("BEA"), whereby the amount payable by BEA to you or the amount receivable by BEA from you is based on the prices of paper gold quoted by BEA from time to time that you may agree to buy or sell, subject to the Terms and Conditions of the Gold Account Agreement and the Rules and Regulations Governing Gold Account set by BEA. The Bank is subject to prudential regulation of the Hong Kong Monetary Authority. Insolvency risk Any transaction involving a Gold Account is subject to the credit and insolvency risks of BEA. If BEA becomes insolvent or goes into liquidation, you may lose your entire investment irrespective of the paper gold price. Not a time deposit A Gold Account is not the same as nor should it be regarded as a substitute for traditional time deposits. Not a protected deposit Investments made under a Gold Account are not principal protected. Gold Account investments are NOT protected by the Deposit Protection Scheme in Hong Kong. Fluctuation of price in paper gold Paper gold prices are volatile. When investing in paper gold, customers should be aware that the value of the investment is calculated with reference to gold prices which may go down as well as up. As gold prices fluctuate, the value of your investment may become substantially less than the original investment amount. No obligation to back up purchases with physical gold BEA is not obligated to fully hedge or back up BEA's position in respect of a Gold Account with physical gold. No physical gold delivery involved The transactions of sale and purchase of paper gold in a Gold Account do not involve delivery of physical gold. You do not have any ownership, right and possession of any physical gold in the Gold Account. Gold allocation in Gold Account is notional only and is solely for valuation of your investment. Account closure risk BEA reserves the right to close the Gold Account at any time in the circumstances as described under item 11 Gold Account Features on page 3 hereof and the Terms and Conditions of the Gold Account Agreement and the Rules and Regulations Governing Gold Account set by BEA. Set-off right by BEA BEA has the right to combine and consolidate any balances standing to the credit of your accounts maintained with BEA to set-off against all or any indebtedness owed by you to BEA. An investment product This is an investment product. The investment decision is yours but you should not open a Gold Account and invest in paper gold unless the intermediary who sells it to you has explained to you that the product is suitable for you having considered your financial situation, investment experience, and investment objectives. Important Notes The Securities and Futures Commission ("SFC") has authorised the issue of this Principal Brochure under Section 105(1) of the Securities and Futures Ordinance, Chapter 571, Laws of Hong Kong. The SFC shall not be responsible as to the contents of this Principal Brochure. SFC authorisation does not imply SFC's endorsement or recommendation of the Gold Account. Before opening a Gold Account, you should read this Principal Brochure carefully and understand the contents of it. You should also read and understand the Terms and Conditions of the Gold Account Agreement, and the Rules and Regulations Governing the Gold Account set by BEA, which can be obtained through any of the branches of BEA. Please also be aware of the Important Risk Warnings stated above and the Risk Factors stated at the end of this Principal Brochure. In case you are in doubt in respect of any contents mentioned in these documents, you should seek independent professional advice. PP203 (05/2014) 1

3 BEA offers you convenient access to one of the world's most exciting alternative asset classes gold. Historically, gold has exhibited a low correlation to other asset classes, and served as an effective hedge against inflation. Besides, gold is more internationally recognised as a currency than any other paper currency since gold is a reliable store of value. Seize this opportunity to diversify your investment portfolio open a Gold Account with BEA today! Gold Account Features With a Gold Account, you can trade paper gold in a quantity of taels and enjoy a wide range of value-added features: Simple account operation All paper gold transactions are recorded in a Gold Account passbook, including details on quantities, unit prices, the HKD equivalent of paper gold transactions, and the current account balance in taels of gold for easy reference. Purchase of paper gold by customer will be recorded as a credit balance. Sale of paper gold by customer will be recorded as a debit balance. No physical gold delivery involved Any sale and purchase transactions do not involve the delivery of physical gold, and thus, greater security and convenience can be enjoyed as no security, insurance, or storage problems will arise. Pricing and fees Transactions are effected solely through BEA at the sale/purchase price quoted by BEA at the time of transaction. Unit sale/purchase prices quoted by BEA take into account the prevailing local and world market price for gold, the exchange rate between the United States dollar and Hong Kong dollar, and gold fineness of the troy ounce and tael. At present, the reference gold is gold bars or unallocated gold of 99 tael gold of Hong Kong market and/or Loco London gold in relation to good delivery and fineness from time to time in effect. The selling price of paper gold as quoted by BEA will not exceed 103% of the buying price of paper gold as quoted by BEA, depending on market conditions (i.e. a spread of 3%). There are no handling charges imposed by BEA other than the actual buying or selling price at the time of transaction. Except for fees and charges specifically mentioned in the table below, any other fees and charges incurred by BEA for operational or administrative purposes and BEA's profit margin are already inherently contained in and subsumed in the bid/offer spread. BEA may vary or impose further handling charges by giving at least 30 days' prior notice. Gold Account fees and charges: Category Report loss of passbook or chop Passbook damaged Account closed by customer within 3 months from the date of opening Charge per item HK$100 HK$100 HK$200 per account BEA reserves the right to amend or alter any of the above-mentioned fees and charges and/or to introduce new fees and/or charges at any time with prior notice of at least 30 days. 4 5 Multiple dealing channels Transactions can be made via Cyberbanking (Phone: , Internet: or Mobile Banking Service) or by presenting a signed Purchase/Sale Order Form with your Gold Account passbook at any BEA branch. Customers can obtain paper gold price information at any BEA branch or after logging in to their Cyberbanking accounts. Trading hours Trading is available through all channels Monday to Friday (excluding public holidays) from 9:00 a.m. to 5:00 p.m. Hong Kong time. 2

4 Currency denomination The sale and purchase prices quoted for paper gold are denominated in HKD. Minimum initial investment The minimum investment required for opening a Gold Account is 1 tael. Interest The Gold Account is a non-interest bearing account. Suitability The Gold Account is suitable for customers who have a positive view on gold price prospects and possess sufficient net worth to assume the risks and bear the potential losses of investment in a Gold Account. Eligibility The Gold Account may be opened by an adult who is at least 18 years old or a company with proper identity documents. Customers are required to designate a HKD savings account, a HKD current account, or SupremeGold/Supreme Account/ i-account - HKD Current Account, for payment or receipt of funds resulting from their Gold Account transactions. Account closure BEA reserves the right to close the account at any time in case of any of the following: In the event that there is any change of law, which prohibits or renders illegal the maintenance or operation of the Gold Account and/or the Gold Account Agreement signed upon account opening or any part thereof; or 11 If a customer is suspected not to act in accordance with the laws, rules, regulations, guidelines, requests, and/or recommendations of public and regulatory organisations or authorities operating in various jurisdictions, which relate to, amongst other things, the prevention of money laundering, terrorist financing, and the provision of financial and/or other services to any persons or entities that may be subject to sanctions; or If a customer fails or refuses to execute or re-execute (as the case may be) within such time as requested by BEA such further document(s), which may be required by BEA at its sole and absolute discretion deem necessary whether for BEA's administrative purposes or as a result of the revision of documentation relating to the Gold Account or otherwise and a final notice requiring customer's execution or re-execution of such document(s) has been served on the customer and expired; or If a customer commits any breach of or fails to observe or perform any obligations under the Terms and Conditions of the Gold Account Agreement and/or the Rules and Regulations Governing Gold Account set by BEA which, in the opinion of BEA, amounts to a material default on the part of the customer; or If there appears in a Gold Account bank book a zero balance for a period of 6 continuous months. Gold Account closing can be done at any BEA branch. Any outstanding balance of the Gold Account will be sold to BEA at the time the Gold Account is closed. No charges or fees will be charged by BEA for closure of a Gold Account which has opened for more than 3 months. For other fee schedules, please refer to item 3 Pricing and fees. 12 BEA's right of set-off and lien BEA is authorised and empowered at any time and without notice to combine and consolidate all or any of the account(s) (including but not limited to any overdraft, loan, current, savings, time deposit, and Gold Account) held with BEA in a customer's name and set off any monies, rights, interests and/or liabilities owing to the customer by BEA in or under any one or more of such accounts in or towards satisfaction of any liabilities owing by the customer or in any other respect whether such liabilities be actual or contingent primary or collateral and several or joint and BEA may for the purpose of set-off or combination of accounts at the time of the passing of the entry therefor at BEA's sole and absolute discretion sell or convert into money all or any of the gold for the time being at the time of the set-off or combination of accounts recorded in the customer's Gold Account to be owing and due by BEA to the customer. BEA is at liberty and is authorised to withhold and/or earmark or exercise a lien without a customer's prior knowledge or consent so much of the paper gold for the time being recorded in the customer's Gold Account to be owing and due by BEA to the customer as the customer may at BEA's sole and absolute discretion deem fit as security for the payment of any or all monies and/or liabilities owing or payable by the customer to BEA on any other account or accounts howsoever (whether actual or contingent, joint or several) and if the customer fails to pay to BEA any amount due but unpaid by the customer as demanded, BEA shall be entitled to sell at such time or times as BEA may at its sole and absolute discretion deem fit all or so much of the paper gold in the customer's Gold Account and apply the proceeds of sale to discharge the whole or any part of such of customer's liability to BEA as aforesaid after first discharging all expenses incurred by BEA in effecting any such sale. 3

5 Information of BEA BEA is listed on The Stock Exchange of Hong Kong Limited and is regulated by the Hong Kong Monetary Authority. You may access the BEA's latest annual report and any interim results by visiting Ongoing Disclosure BEA will also give notice to you of any information about BEA which may significantly affect its ability to perform its obligations under the Gold Account. Risk Factors Insolvency risk. Any transaction involving a Gold Account is subject to the credit and insolvency risks of BEA. If BEA becomes insolvent or goes into liquidation, you may lose your entire investment irrespective of the paper gold price. Not a time deposit. A Gold Account is not the same as nor should it be regarded as a substitute for traditional time deposit. Not a protected deposit. Investments made under a Gold Account are not principal protected. Gold Account investments are NOT protected by the Deposit Protection Scheme in Hong Kong. Fluctuation of price in paper gold. Paper gold prices are volatile. When investing in paper gold, customers should be aware that the value of the investment is calculated with reference to gold prices which may go down as well as up. As gold prices fluctuate, the value of your investment may become substantially less than the original investment amount. Account closure risk. BEA reserves the right to close the Gold Account at any time in the circumstances as described under item 11 Gold Account Features on page 3 hereof and the Terms and Conditions of the Gold Account Agreement and the Rules and Regulations Governing Gold Account set by BEA. Set-off right by BEA. BEA has the right to combine and consolidate any balances standing to the credit of your accounts maintained with BEA to set-off against all or any indebtedness owed by you to BEA. Force majeure events. BEA is not liable for any failure or delay to meet its obligations due to any causes beyond its control which shall include fires, storms, acts of God, riots, strikes, lock-outs, wars, governmental control, restriction or prohibition whether local or international, technical failures of any equipment, power failures, black-outs, or any other cause which results or is likely to result in the erratic behaviour of commodity prices, the closure of international gold markets and the local Gold and Silver Exchange or any other cause affecting the operation of Gold Account. BEA has taken reasonable care to ensure that all statements of fact and expressions of opinion contained herein are accurate and that no material facts have been omitted. The information in this Principal Brochure is accurate as at the date hereof. BEA accepts full responsibility for the accuracy of the information contained in this Principal Brochure and confirms, having made all reasonable enquiries, that to the best of its knowledge and belief, this Principal Brochure does not contain any untrue statements (including a statement which is misleading in the form and context in which it is included and including a material omission). Past performance is not indicative of future performance. Investors should not make investment decisions based solely on this Principal Brochure. If you have any questions, please seek independent professional advice. This Principal Brochure is intended only for distribution to selected customers or potential customers of BEA. You must read and understand this Principal Brochure before investing in the Gold Account. You must also complete the relevant application form and read the Terms and Conditions of the Gold Account Agreement and the Rules and Regulations Governing Gold Account set by BEA. Customer Service Hotline