What is a 5-Year Floating Rate Time Deposit?
The 5-Year Floating Rate Time Deposit is a long-term time deposit with quarterly interest repricing. Minimum term is five (5) years + 1day with interest paid out every quarter from the accountís anniversary date. Depositors must have an EastWest checking account or savings account to which the pay-outs will be credited.
What do you mean by quarterly interest repricing?
Interest rate will reset every quarter from date of anniversary based on the 1 month weighted average accepted yield of the Term Deposit Auction Facility (TDF) of the Bangko Sentral ng Pilipinas (BSP). The rate to be used will be the rate as of the last auction date immediately preceding the repricing date.
The Bank reserves the right to change the interest rate benchmark to a 3-month benchmark if a relevant and market-accepted benchmark has been implemented.
Can companies avail of this product?
No. This product is only available to individuals.
What is the minimum & maximum placement per client?
The minimum is P100,000. The maximum is P20,000,000.
What is the minimum term?
5 years and 1 day.
What will happen if I opened my TD with 1.75% interest and the interest rate went up to 2.5% in the next quarter?
Your interest earnings will be higher if the applicable interest rate for the next quarter goes up. In the same manner, if the applicable interest rate for the next quarter goes down, your interest earnings for the quarter will be lower.
When do you compute for the quarterly interest?
At the end of every quarter.
Do I need to open a Peso savings or checking account with EastWest?
Yes, if you still donít have one. But if you do, just nominate your existing savings or checking account where your quarterly interest will be automatically credited. The interest cannot be rolled over with the principal, thatís why you need a Peso CASA account for the quarterly interest pay-outs.
Is this TD account subject to withholding tax?
No, a 5-year term deposit is exempted from withholding tax as long as you maintain your placement to full term. If you pre-terminate, pre-termination charges and applicable withholding tax apply.
||Withholding Tax Rate
|Less than 3 years
|3 years to less than 4 years
|4 years to less than 5 years
What will happen to the interest payments already credited to my CASA if I preterminate my TD?
When you preterminate your TD, a new interest rate per quarter will be applied retroactively to your principal amount according to the number of years you maintained your TD.
||Applicable Gross Rate
|3 years and below
||50% of original rate
|More than 3 years but less than 5 years
||75% of original rate