HSBC Offers Ringgit I-Rate Options
HSBC is looking to offer interest-rate options for the first time in Malaysia on the back of growing customer interest, according to Aik Sai Hong, treasurer in Kuala Lumpur. "This is an extension of our capabilities," said Hong. He continued that the bank recently started educating clients about using local currency caps, floors and swaptions and that it will look to complete its first deals in the coming months. "We're looking forward to doing some transactions before the end of the year," Hong added. Interest-rate options will allow clients greater flexibility to hedge liabilities. The products will likely be sized around MYR10-50 million (USD2.6-13.1 million).
Growing volumes in the interest-rate derivatives market in Malaysia and more clients signing International Swaps and Derivatives Association master agreements has led HSBC to decide there is adequate interest for exotic products. "More and more people are signing ISDAs--this is a good sign," said Hong.