09 JUNE 2010
UNFORTUNATELY THIS PRODUCT HAS BEEN WITHDRAWN UNTIL FURTHER NOTICE










FOREIGN CURRENCY HOME LOAN 
A Foreign Currency Home Loan offers customers who may be residing either within Australia or offshore the ability to borrow funds in a foreign currency, provided their main source of income is denominated in the same foreign currency, creating a natural hedge for loan repayments. Foreign currencies available are:

Hong Kong dollar (HKD)
United States dollar (USD)
Singapore dollar (SGD)
British Pound Sterling (GBP)
New Zealand dollar (NZD)
Euro (EUR)


Key Benefits/ Target Market  - This product has a broad base appeal to a variety of customers, however the key target market is high net worth Australian Expatriates and Foreign Investors living in Hong Kong, Singapore, the Middle East, USA, UK, New Zealand and Europe who are investing in Australian residential property.
 
Key benefits are:
Customers can match their loan repayments to the currency in which they are earning
Customers can secure the loan using standard residential property in Australia
Investors can borrow up to 100% of the value of a new property (with additional security)
Redraw available (subject to Bank's approval)
Customers may switch between currencies
Substitution of security is also available (Australian security property only).

Eligibility (product) Availability is restricted to investment/business use only.
Eligibility (borrower) Eligible customers are those:
Whose main source of income is denominated in a foreign currency, and
Who are residing either within Australia, or offshore.
Situations where one borrower is residing offshore and the co-borrower is residing in Australia should be referred to Non Resident Lending.

Repayment Options: Interest Only - 3 or 6 months or Principal & Interest - 3 or 6 months

Loan Amount Minimum: $100,000 Maximum: Negotiable - dependant upon affordability 

The interest rates quoted below are the sum of the Currency Reference Rate and a margin from 1.00% to 1.50%. Reference rates are subject to change at any time. Rates are indicative only, and are a daily average for week ending Friday, 14 May 2010

Loan Term Principal & Interest 1 - 30 years Interest Based 1 -15 years
Interest based loans need to be renegotiated at the end of this period.

Repayment Types:  
Principal & Interest Customers may nominate to pay 3 or 6 monthly in arrears. 
Interest Based 1 -15 years Customers may nominate to pay 3 or 6 monthly in arrears.

Repayment Due Date The first repayment is due on the 'rollover date' 3 or 6 months (whichever is nominated at the time the loan is established) after the settlement date. The rollover date is set to the 10th day of each month. For example, if a loan settles on 31/12/03, the first repayment is due on 10/4/04.

If the repayment due date falls on a weekend or public holiday the repayment will be due on the next available working day.

Repayment Method TT or Direct transfer
A remittance advice is sent to the customer outlining the payment amount due.

The customer is able to send the repayment amount via Telegraphic Transfer (TT) or Direct Transfer from their overseas bank as per the instructions on their remittance advice.

Principal Reductions Principal reductions are permitted without any additional charge provided such repayment is made on the scheduled instalment date with at least 10 days prior notice given.
Principal repayments at any other time still requires at least 10 days notice to the Bank and may incur break-funding costs in some circumstances.

Redraws Borrowers may redraw prepayments subject to the bank's approval.
A redraw fee applies to each approved request.

Switching (Customer) Customers have the ability to switch between the following currencies:
Australian dollar (AUD), Hong Kong dollar (HKD) and United States dollar (USD)
Australian dollar (AUD) and Singapore dollar (SGD)
Australian dollar (AUD) and British Pound Sterling (GBP)
Australian dollar (AUD) and New Zealand dollar (NZD)
Australian dollar (AUD) and Euro (EUR)

Switching (Bank) The Bank has the right to convert the loan from foreign currency to AUD at its discretion. This discretion will be exercised by Non-Resident Lending in the event that:
A top up has either not been met
The LVR on the loan exceeds the percentage specified in the offer letter
It becomes impractical for the loan to be denominated in a particular foreign currency.

Loan Splits Splitting
A foreign currency home loan can be split to create an additional loan e.g. 50% in AUD & 50% in SGD.
Increases Further Loan and Loan Amount Increase
The Foreign Currency Home Loan may only be selected as a further loan.
A further loan is an additional loan under the same security and borrowers and where a new loan is created as an additional sequence.

Loan amount increases on the current sequence are not allowed on the Foreign Currency Home Loan due to differing exchange rates with each drawdown.

Refinances Refinances from other financial institutions
A full valuation is required, regardless of LVR
LVR cannot exceed 75%
Loan statements must be obtained from the current lender to verify the loan repayment history during the previous twelve (12) month period

Reviews Not applicable.
Serviceability Minimum commitment cover is 1.25 times for Interest Only and P+I loans (i.e. surplus cash flow after all other commitments must be 1.25 times the loan repayment amount).
For this purpose a "plug rate" is set at the Higher of:

Customer Rate (i.e. HIBOR/SIBOR plus margin) plus 1.75% or
The Bank's standard variable rate for AUD loans.

Loan To Valuation Ratio When the loan is denominated in AUD the maximum LVR for amounts less than AUD750,000 is 80%.
A maximum LVR of 75% applies to:

Loan amounts equal to or greater than AUD750,000 that are denominated in AUD.
Loans in foreign currencies.

The Bank's normal maximum LVR's for specialised securities are discounted by 5%.

For example, serviced apartments with a floor area <50sqm will have their maximum LVR reduced from 70% to 65%.


Loan Top Up A top up clause in the Loan Offer Document covers the Bank where the cross rates between the AUD security and the client's nominated foreign currency result in the LVR exceeding 75%. When the loan is being approved, the customer needs to demonstrate the capacity to meet a 5% top up.
When exchange rates move and result in the LVR exceeding 75%, a top up call will be made on the customer. In these cases the Bank can require the security property to be revalued, additional security by way of cash deposit or another acceptable security property, or a reduction of the loan to reduce the Bank's exposure to 75%.

See also "Switching (Bank)" above.

Valuation A Standard Valuation is required for all security properties.
Security Current credit policy applies except for vacant land, which is excluded unless a building contract has been signed.
Refer to Lending Policy for Acceptable Security types.

Substitution of Security Substitution of security allowed subject to the bank's consent.
Simultaneous settlement required.
Security to be substituted must be a "like for like" otherwise new loan is required.
Substituted security cannot represent a reduction in security for the bank.
("Like for like" is, for example, ready built house substituted with a ready built house - Building Loan is not permitted; 1st mortgage substituted for a 1st mortgage - 1st mortgage substituted for a 1st mortgage with a guarantee is not permitted.) 

Establishment fee
The fee includes the Bank legal fees for one new security property and any number of existing securities and one standard valuation for the primary security property only, regardless of whether a valuation on that property is required or not.

Additional legal fees and valuation fees (if applicable) must be collected for each additional security property, after the first security property.

Settlement Processing fee
This fee is payable at settlement.

Administration Fee
There is no administration fee on Foreign Currency Home Loans.

Currency Switch Fee
This fee is payable when switching between different foreign currencies.

Early Repayment Fee
An Early Termination fee, of 0.75% of the loan amount, will apply whenever the loan is repaid within 3 years of the date of the first advance.

Interest Offset Facility Not available on Foreign Currency Home Loans
Statement Statements are issued yearly - in June.
Interim Statements / Replacement Statements
These are available for mailing out on request. A fee is applicable. Refer to Loan Accounts Charges for specific services and accounts.