Standard Chartered Bank (Hong Kong) Ltd., BOC Hong Kong Holdings Ltd. (02388.HK) and Dah Sing Banking Group Ltd. (02356.HK) are among the lenders redrawing interest rates and rolling out new investment products to draw in more renminbi funds.
The move comes as authorities prepare to launch Shanghai-Hong Kong Stock Connect, the cross-border securities trading program, on Monday, the Hong Kong Economic Journal noted Friday.
Standard Chartered has raised the time deposit rate to 3.4 percent for tenors of three months and six months, matching the level for one year.
Dah Sing is selling a 9-month principal-guaranteed product starting Monday, which would result in an 8.15-percent return if the renminbi appreciates 0.3 percent. A minimum of 0.5-percent interest rate per annum will apply even if the redback sees a dip in its exchange rate.
BOC Hong Kong, meanwhile, is launching a series of renminbi-denominated products, including personal pledged loan, renminbi-linked deposit and margin trading for A shares.
“We can see that there have been more renminbi deposit products over the past few weeks. Banks are offering very competitive deposit interest rates,” said Ann Kung, general manager for personal banking at BoC Hong Kong.
Banks will continue to strive for renminbi deposits with higher interest rates in the short term, she added.
BoC Hong Kong is also offering a three-month Renminbi Flexi Time Deposit in which depositors can enjoy a three-percent interest rate and early redemption prior to maturity, Kung said.
Chow Chak-chee, deputy general manager of product management at BOC Hong Kong, said the bank will over the weekend participate in a final drill on the mutual market access program.
It will simulate the entire process of the Stock Connect, from clients giving buying orders to clearing and settling the accounts, he said.
The Hongkong and Shanghai Banking Corporation Ltd. and Haitong International Securities Group Ltd., meanwhile, are trying to lure stock-trading clients with commission fee waivers.
As the daily limits on renminbi conversion will soon be removed for Hong Kong residents, banks will continue to compete for deposits by offering higher interest rates, industry watchers say.
Vey Wong contributed to this story
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