StanChart dangles 10% deposit rate in Hong Kong to draw China cash

HONG KONG – Standard Chartered is offering short-term deposit rates of as high as 10 per cent as the lender seeks to attract Chinese customers.

Select customers that are part of the Wealth Management Connect programme can exchange renminbi to US dollars with funds equivalent to HK$100,000 (S$17,390) or more and earn a preferential rate of 10 per cent per annum for a one-month time deposit, according to a statement.

The Hong Kong units of Industrial and Commercial Bank of China and China Construction Bank, two of the largest state-controlled Chinese banks, in February also offered rates of more than 7 per cent for one-month time deposits as part of a promotion for wealth connect customers.

Lenders in Hong Kong are ramping up efforts to woo deposits from mainland China and solidify the city’s status as a wealth hub. Since the border reopened in 2023, mainlanders have been flocking to Hong Kong to open accounts and invest in offshore products, including deposits and insurance.

The renminbi and other Asia currencies have been under pressure, and China this week reiterated the need to prevent one-sided moves in the renminbi.

The Hong Kong and Chinese authorities expanded the Wealth Connect programme earlier in 2024, allowing individual investments to be raised to 3 million yuan from 1 million yuan, and making more funds eligible. Under the wealth link, mainland investors in the Greater Bay Area are allowed to move money out of China in a closed loop system.

Standard Chartered is also offering rates as high as 13.8 per cent for time deposits in Hong Kong for flexible tenors of seven or 14 days, according to its website, while HSBC Holdings is offering up to 13.5 per cent per annum for one week time deposits provided customers exchange currencies. BLOOMBERG


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