REPO DEALS

The Treasury Department effects two repo deal types:

• Traditional repo /sell-buy/ - a deal, where the bank "sells" a security to the customer with the provison for its reverse purchase on the repo deal maturity date at a predetermined price. This repo deal type provides an additional guarantee for Your deposited funds and/or allows rebalancing the structure of Your assets.
• Reverse repo / buy-sell/- a deal, where the bank purchases a security from the customer and fixes the price, at which it will sell that same security to the same customer on a predetermined future date. This repo deal type offers flexible short-term financing in leva, EUR or US dollars against collateral of securities held under UBB register.

FX SWAP

• Definition - exchange of amounts in one currency for another currency with the agreement for their reverse exchange on a certain future date at a predetermined FX rate.
• Allows optimum current liquidity management in the respective currency, as well as hedging of the foreign currency exposure of of Your business's cash flow.
   

IR SWAP

Interest Rate Swaps are instruments for hedging interest rate risk. In effect they are agreements between UBB and a client to exchange interest rate payments on a negotiated principal amount, where one of the interest rates is a fixed percentage, and the other is a floating interest rate determined by some money market index.

For more information please call us on +3592 8112436 and +35928112441
 

FX OPTIONS

The buyer of currency options has the right, not the obligation to buy/sell base currency at agreed in advance exchange rate (exercise price) on a certain date in the future (European type option) or on any day till a certain future date (American type option).

By purchasing an option the buyer limits his eventual losses to the premium paid, in case of unfavorable FX rate fluctuations, and at the same time retains the opportunity to generate profit in case of favourable FX rate fluctuation.

Strengths - risk limited to the premium paid, fixed maximum future exchange rates, corresponding payments, unlimited potential for generating profit.

Weaknesses - in order to effect this strategy you have to pay the option premium - so called option price.
 

FX FORWARD

FX Forward is an agreement between UBB and the client, pursuant to which currencies are purchased and sold on prices agreed now, but with delivery on certain future date at a so called forward rate. This is an agreement legally binding both to UBB and its client - without the requirement to transfer funds before the agreed future date.

When dealing FX Forward the client is required to secure a collateral deposit that guarantees the execution of the deal at the future date. The amount of the collateral deposit depends on the volatility (fluctuation) of the FX rate of the particular currency pair.

Advantages:

• Eliminates the uncertainty resulting from exchange rates fluctuations
   
• Facilitates precise budgeting
   
• Enables the company to concentrate on its main activity and not on day to day exchange rates fluctuations
   
• The use of FX forward does not encumber the customer with additional costs.

Shortcomings:

• FX forwards do not allow clients to generate FX gains in case of spot rate being more favourable on the value date than the agreed forward rate.

For more details please call us at +3592 8112440, +3592 8112442  и +3592 8112439, или e-mail: stefanov_va@ubb.bg, mays_k@ubb.bg, krasteva_b@ubb.bg

OTHER DERIVATIVES AND STRUCTURED PRODUCTS

To discuss different opportunities for hedging, speculating, and/or finding the right solution for Your personal and business needs, please call us on +3592 8112440, +3592 8112442  и +3592 8112439, или e-mail: stefanov_va@ubb.bg, mays_k@ubb.bg, krasteva_b@ubb.bg

Minimum principal amount for the above deals and products is 100 000 (one hundred thousand) currency units.

Other

Treasury Department. provides to its customers a free of charge daily bulletin with updated information for the local and international money, FX and capital markets. The information is available to our customers at each business day beginning.

Treasury Department employees offer consultancy for the most suitable investment instruments and strategies, taking into account customers' perception for the optimum ratio between return levels and risk undertaken

UBB AD reserves itself the right to amend the terms of the above products and services in accordance with the market conditions as well as to negotiate other terms in any specific transaction.