Currency conversion (spot)

In case of sizeable exchange volumes (over LVL 5,000) and the necessity to perform transactions regularly (several times per month), the customer may effect the currency conversion transactions by telephone via Swedbank's currency dealers.

Possibilities:

• Convert currencies according to competitive exchange rates,
• Give instructions for currency conversion transactions by telephone,
• Receive advice from Swedbank Financial Markets specialists regarding the trends in the foreign exchange market.

What you need:

• Open a Private Account or Salary Account with Swedbank, ,
• Sign a "General Agreement On Foreign Exchange Transactions" with Swedbank

After signing an agreement on foreign exchange transactions, the customer is given a password, by means of which the customer's identity is verified prior to each transaction.

• Currency conversion becomes effective when the parties have agreed on the terms of the transaction (record of the telephone conversation serves as a proof of the agreement on the transaction).
• The transaction is entered in the customer's accounts within an hour after its conclusion.

Future Currency transactions (forward)

A forward is a currency conversion with a future value date. The maturity of the forward transaction may vary between three banking days to 1 year and longer. Forwards are convenient if the customer's incoming and outgoing cash flows are in different currencies and the dates and amounts of such cash flows can be estimated some time in advance. The bank offers to define a currency exchange rate for future currency conversions, which means that the customer's revenue in the selected basic currency will not fluctuate along with general exchange rate fluctuations.

The terms of the forward transaction stipulates that both the bank and the customer undertake the obligation to convert currency on the date and in the amount agreed on the basis of the pre-established currency exchange rate.

Possibilities:

• Hedge currency risks,
• Accurately plan revenues independent of exchange rate fluctuations,
• Fix the future currency exchange rate today,
• Perform forward transactions issuing instructions by telephone.

Security needed:

The need for a security is evaluated on a case-by-case basis, while the amount of the security depends on the term of the transaction and the currencies involved.

What you need:

• Open a Private Account or Salary Account with Swedbank, ,
• Sign a "General Agreement On Foreign Exchange Transactions" with Swedbank

After signing an agreement on foreign exchange transactions, the customer is given a password, by means of which the customer's identity is verified prior to each transaction.

• Currency conversion becomes effective when the parties have agreed on the terms of the transaction (record of the telephone conversation serves as a proof of the agreement on the transaction).
• The transaction is entered in the customer's accounts within an hour after its conclusion.

Currency Swaps

Swap transactions are banking services allowing the customer to agree with the bank on currency conversion according to a fixed exchange rate in the nearest future, at the same time undertaking to convert the currency back according to a pre-established exchange rate in more distant future. Accordingly, a swap can be considered to comprise two loans where the bank lends money in one currency at the same time borrowing an equivalent amount in another currency. Swaps are off balance sheet transactions displayed as two transactions - a regular currency conversion and a forward with the same transaction amount, but effected in opposite directions and on different dates.

Currency exchange rates on both occasions are different and depend on the exchange rate differences of the currencies involved.

Possibilities:

• Hedge currency risks,
• Balance, without additional currency risks, currency resources in situations where there are excess funds in one currency and shortage in another, to perform swap transactions by giving instructions by telephone.

Security needed:

The need for a security is evaluated on a case-by-case basis, while the amount of the security depends on the term of the transaction and the currencies involved.

What you need:

• Open a Private Account or Salary Account with Swedbank, ,
• Sign a "General Agreement On Foreign Exchange Transactions" with Swedbank

After signing an agreement on foreign exchange transactions, the customer is given a password, by means of which the customer's identity is verified prior to each transaction.

• Currency conversion becomes effective when the parties have agreed on the terms of the transaction (record of the telephone conversation serves as a proof of the agreement on the transaction).
• The transaction is entered in the customer's accounts within an hour after its conclusion.

Currency Options

Currency Options is a banking service allowing the customer to hedge against future changes in the currency exchange rate. By buying a Currency Option, the customer has the right, but no obligation to make currency conversion according to a previously established exchange rate on a specified date. The customer or the party purchasing the option pays a premium (option price) to the bank or the party that guarantees performance of obligations.

Currency Options are convenient if the customer's incoming and outgoing cash flows are in different currencies and the dates and amounts of such cash flows can be previously estimated. Currency Option grants the right to its owner but does not incur an obligation to perform currency exchange if the exchange rate fluctuations are not favourable for the customer. The amount of the option price or premium is calculated depending on instability of the currencies involved, the exchange rate established for the deal, exchange rate differences of the currencies involved, maturity of the deal, etc. The right to buy currency in the future is called a call option for such currency, while the right to sell a currency is a put option for such currency.

Possibilities:

• Hedge currency risks,
• Use the right to perform currency conversion in the future according to a pre-established exchange rate,
• Avoid responsibility to perform currency conversion according to a pre-established exchange rate,
• Perform currency option transactions issuing instructions by telephone.

What you need:

• Open a Private Account or Salary Account with Swedbank, ,
• Sign a "General Agreement On Foreign Exchange Transactions" with Swedbank

After signing an agreement on foreign exchange transactions, the customer is given a password, by means of which the customer's identity is verified prior to each transaction.

• Currency conversion becomes effective when the parties have agreed on the terms of the transaction (record of the telephone conversation serves as a proof of the agreement on the transaction).
• The transaction is entered in the customer's accounts within an hour after its conclusion.