OCBC Share Financing Account allows you to maximize your purchasing power. To open a Share Financing Account, you only need to place a minimum cash deposit of S$5,000 or deposit S$5,000 worth of marginable securities and you can enjoy the following benefits:

* Increase in investment power of up to 3.5 times
* Competitive interest rate of 1% above OCBC Prime rate at daily rest
* Convenience of using the account via internet or mobile phone

You may download, print, sign and forward the Account Opening and Memorandum of Charge  forms to us.

Optional forms to complete (if applicable):

  * New margin accounts of foreign client may be subjected to higher maintenance margin requirements.

       Please contact your respective TRs for further information.

Additional supporting document required:

• A copy of your latest CDP Statement of Securities Holdings &/or CPF Investment Account (if any)
• A copy of your annual income tax assessment generated by IRAS or half-yearly CPF statement generated by CPF Board or Bank statements generated by a financial institution

B)    Opening a Corporate Share Financing Account

Please call us at 1800-338 8688 or (65) 6338 8688 to request for a copy of the forms to be sent to you. After completion, you may forward to us at the following address:

OCBC Securities Pte Ltd

18 Church Street

#01-00  Singapore 049479

Attention: Customer Service Dept

Supporting documents required:

1.      Certificate of Incorporation

2.      Certified True Extract of Directors Resolutions of the Company 

3.      Memorandum and Articles of Association 

4.      RCB instant information print-out dated less than 2 weeks

5.      Others (as requested by our Company where applicable)

All documents have to be certified true copy by:

(i)   2 Directors of the company; or

(ii)  A Director and Secretary of the company; or

(iii) Notary Public^; Advocates and Solicitors^; Justice or Peace^; or

(iv) Commissioner for Oaths^ (Certification only)

^ Please provide name and contact number of the witnessing officer

For details on opening CDP Securities Account (Account Number format: 1681-xxxx-xxxx) for Corporation, click here.

You can start trading when you have put up the initial collateral with us. You can put up either cash or marginable securities as collateral. If the initial collateral is in the form of marginable securities, you have to wait until your shares are transferred to OCBC Securities Pte Ltd. This normally takes about 2 to 3 days.

A) Cash as Collateral

Illustrative example :-

Assumption: The client provides a cash deposit of $5,000 and buys $17,500 worth of shares 1 The market value of the purchased shares equals to total cost of the purchases (unit price per share is the same)

Total market value of shares purchased) / Cost of shares purchased - Cash collateral)

Margin % = $17,500 / ($17,500 - $5,000)

                 = 140%

1 Customers are advised that when the buying limit is fully utilised, a slight drop in share price will trigger a margin call under your account

B) Securities as Collateral

Illustrative example :-

Assuming that client deposited share collateral valued at $20,000 and the market value of the purchased shares is equal to the total cost of purchases at $50,000 

Total market value of share portfolio (including collateral) / Amount Owing in Share Financing Account)

Margin % =   ($20,000 + $50,000) / $50,000

                  = 140%

You can buy all securities quoted on the Singapore Exchange and selected securities quoted on Bursa Malaysia, Hong Kong Exchange, NYSE, NADSAQ, and AMEX. However, certain securities are given zero value or a value lower than its full market value.

For more information, please contact either your Trading Representative or our Customer Service Department at 1800 338 8688.

You can buy as many counters as you wish provided the counters are on our list of marginable securities. However, the total quantity of a single counter in your portfolio must not exceed the Sub-Counter Limit determined by us. The Sub-Counter Limit will be reviewed on a monthly basis. Any quantity purchased in excess of the Sub-Counter Limit will not be valued for the computation of the margin percentage in your account. For instance, the Sub-Counter Limit for ABC share is 50,000. If you have deposited 50,000 ABC shares as collateral and purchased 10,000 ABC shares in your Share Financing account, only 50,000 ABC shares (instead of 60,000 shares) will be valued at the previous day closing price.

The interest rate payable starts from as low as 1% above OCBC Prime Lending Rate and charged on due date of your purchase on a daily rest basis

Yes. You will be able to trade up to the maximum of the financing available or approved limit, whichever is lower, provided the margin % does not fall below the maintenance margin of 140%.

If the margin % falls below 140%, you will face a Margin Call.

When the margin % falls below 140%, you will be requested to deposit additional cash, marginable securities or sell shares in the existing portfolio within 2 days to bring the margin % back to at least 140%.

When the margin % falls below 130%, you are required to deposit additional cash, marginable securities on the same day of notification and bring margin % back to at least 140%. Failing that, the Company will have to liquidate your margin shares immediately to bring the margin % to at least 140%. The Company may do so without notifying you.

You can either deposit additional cash, marginable securities or sell shares in your existing portfolio to meet any margin call.

Total market value of share portfolio = S$70,000

Amount Owing in Share Financing Account = S$50,000

Margin Percentage = 140%

Assuming that the market value of shares drops from S$70,000 to S$65,000, the margin percentage will become 130% (i.e. S$65,000 / S$50,000). The amount to top up is calculated below:

Cash top up = Loan – Share Value/1.4

= $50,000 - $65,000/1.4

 

= $3,571

Margin %   =     $65,000        x 100%

   $50,000 - $3,571

=  140%

The amount of top up using share collateral:   Cash top up x 1.4 = $5,000

The value of shares that needs to be liquidated: Cash top up x 3.5 = $12,500

You can withdraw shares from your Share Financing account when your margin % is greater than 140%. The value of the shares that can be withdrawn is determined as follows: -

Illustrative example 1

Your loan portfolio details are as follows:

Collateral Shares (a) = S$100,000
Market value of shares traded ( b ) = S$230,000
Total market value of share portfolio ( a ) + ( b ) = S$330,000

Amount Owing in Share Financing Account = S$200,000

Value of withdrawn shares = Market value of shares - 1.4 ( amount owing)
                                                 = S$330,000 – 1.4 (S$200,000)
                                                 = S$50,000

Alternatively, you can withdraw the net proceeds^ when you sell shares before the due date of the sale transactions. However, you must maintain a margin % of at least 140% after the cash withdrawal.

^Interest will be charged on the amount of the proceeds withdrawn before due date of the sale transactions.

Illustrative example 2:

Assuming that a sale of $30,000 has been executed and you had also top up your account with cash of $14,000 2 days ago to meet margin requirements. The market value of your portfolio remains unchanged, your margin percentage one-day following the due date of the sale will be as follows:-

Market value of portfolio / (Amounting owing + sales proceeds + earlier cash top up) 

Margin % after withdrawal = $300,000 / ($170,000 + 30,000 + 14,000)

                                               = 140%

You can also withdraw cash when there is credit balance in your account. Your account will have a credit balance when the value of your sales proceeds exceeds your loan amount and the accrued interest.

Yes. You will receive monthly statements showing your share transactions, shareholdings and net interest payable.

Yes. Please refer to the table below.

               *Fees and Charges are exclusive of prevailing GST and subject to changes.

Yes, you would need to keep and retain the certificates for submission to Income Tax or any relevant authority for taxation matters. This is because stock dividends are not on auto inclusion for taxation. A nominal fee will be levied on any request to reprint the certificate(s).  

1. Memorandum of Charge
2. W8-BEN form (Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding)

Contra is not allowed for transactions via Share Financing Account. You will have to settle your outstanding buy and sell contracts by their respective settlement dates.