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May 29, 2009
Closure of FSM SGD Cash Account
by FSM
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Closure of SGD Cash Account with effect from 1 July 2009 The SGD Cash Account’s net interest rates have fallen considerably over the past few months. We believe that it is not in the interest of our investors to continue to deposit their monies in the SGD Cash Account. As such, we have decided to close the SGD Cash Account with effect from 1 July 2009. It will be entirely replaced by the Cash Fund, which was launched in Jan 2007. How will this affect existing SGD Cash Account Holders? Existing SGD Cash Account holders will no longer be able to continue to park their monies in the SGD Cash Account. The following sets out the various options available to existing SGD Cash Account holders: Options available to existing SGD Cash Account Holders 1. Convert SGD Cash Account balances to Cash Fund and earn potentially higher returns. You will be prompted with this option upon login. Alternatively, your may go to My Investments tab > Cash Account > Convert to Cash Fund.The order will be processed and your SGD Cash Account balances will be converted and held in the Cash Fund. There is no cost involved. This option is available till 30 June 2009, 3pm. The Cash Fund has had a higher net interest rate† compared to the SGD Cash Account since it was incepted in Jan 2007 even though they both have similar objectives of placing monies into SGD fixed deposits. 2. Use SGD Cash Account balances to invest into unit trusts Simply go to Transactions tab > Buy Unit Trusts. Select Cash Account as the Payment Method. It is subjected to the minimum initial/subsequent investment amount. This option is available till 30 June 2009, 3pm. 3. Hold SGD Cash Account balances till the closure of SGD Cash Account You may continue to leave your balances in the SGD Cash Account till the closure of the account on 1 July 2009, after which we will proceed to close your SGD Cash Account and pay the cheque to you. If you have provided your Direct Credit Instruction details in your FSM investment account, the cheque will be directly credited to your bank account. If you haven’t provided the Direct Credit Instruction details, the cheque will be mailed to your mailing address. The interest earned on the SGD Cash Account will be calculated till 30 June 2009. Please allow approximately 1-2 weeks for us to process the refund. How will this affect SGS bond account holders? Changes to Payment Method for SGS Coupon Payments and Principal Amount Upon Maturity 1. For existing SGS bond holdings purchased before 29 May 2009: All future SGS coupon payments and principal amount upon maturity (payable from 1 July 2009 onwards) will no longer be credited into your SGD Cash Account. You may place your future SGS coupon interest and principal amount upon maturity into the Cash Fund. How do I instruct FSM to reinvest my future SGS coupon payments and principal amount upon maturity into the Cash Fund? Log on to your FSM account and you will be prompted with this option. Simply proceed to confirm your instruction online. Alternatively, you may also submit your instruction from your SGS View Holdings page. It is a one-time instruction. Please note that once you have submitted this instruction, it will apply to ALL future SGS coupon payments and principal amount upon maturity that are derived from your SGS bond holdings in your FSM account. If this instruction is not submitted, these SGS bond payments will be paid to you via cheque. 2. For new SGS bond purchase orders placed from 29 May 2009: Other than the excess monies from the payment, any future SGS coupon payments and principal amount upon maturity will be automatically reinvested into Cash Fund. It will also include ALL future SGS coupon payments and principal amount upon maturity that are derived from the existing SGS holdings in your FSM account (if any). Note: There is no change to the current procedures for other type of SGS bond transactions including sell order. Why Is The Cash Fund Better? The Cash Fund has had a higher net interest rate† compared to the SGD Cash Account since it was incepted in Jan 2007 even though they both have similar objectives of placing monies into SGD fixed deposits. † The Cash Fund's Net Interest Rate Contact Us iFAST and/or its licensed financial adviser representatives may own or have positions in the funds of any of the asset management firms or fund houses mentioned or referred to in the article, or any unit trusts or Singapore Government Securities bonds related thereto, and may from time to time add or dispose of, or may be materially interested in any such unit trusts or Singapore Government Securities bonds. This article is not to be construed as an offer or solicitation for the subscription, purchase or sale of any fund. No investment decision should be taken without first viewing a fund's prospectus. Any advice herein is made on a general basis and does not take into account the specific investment objectives of the specific person or group of persons. Past performance and any forecast is not necessarily indicative of the future or likely performance of the fund. The value of units and the income from them may fall as well as rise. Opinions expressed herein are subject to change without notice. Please read our disclaimer in the website. |