How Does CLI Work?
Assuming AUD/SGD spot rate is trading at 1.2800 and you invest SGD 100,000.
Based on your chosen currency pair, strike rate and tenor, the Bank determines that the enhanced yield (in base currency) is 5.0% p.a.
On the fixing date (2 business days before maturity), the prevailing exchange rate (spot rate) will be compared against the strike rate to determine whether you will be repaid the maturity proceeds in the base currency or the alternate currency.
If you are to be repaid in the alternate currency, the strike rate will be used to convert the maturity proceeds.
*Depending on the spot rate at maturity, immediate conversion back to base currency may result in an excess or shortfall. When the spot rate on fixing date equals the strike rate, you will receive the aggregate of the original investment amount and the enhanced yield in the alternate currency.
All figures and rates used above are for illustration purposes only. The above illustrations are not indicative of the likely or future performance of a CLI and do not cover all possible scenarios.