HSBC Bangladesh has recently closed two euro-dollar 'seagull' transactions with ACI Group, the bank said yesterday.

A seagull option is a three-legged strategy used in forex trading that offers a hedge against undesirable changes in the price of the underlying asset and provides advantages from any market move in their favour. HSBC said the currency hedging solution will safeguard ACI against exchange risks arising from import obligations.

Unlike a plain forward transaction, the client does not have to pay any premium cost for this.

A forerunner in actively analysing various hedging tools used in the international market, ACI Group earlier used a cross-currency option to hedge their currency risk before closing the Seagull deal with HSBC.

“ACI has always been in the forefront of using financial engineering tools available under Bangladesh's forex regulations,” said Muallem A Chowdhury, executive director for finance and planning of ACI Group.

Bashar M Tareq, head of global markets of HSBC Bangladesh, said: “As the world's local bank, HSBC is committed to support the development of local financial markets and offer relevant solutions to our clients, aligned with the local regulatory framework.”

News: The Daiy Star/ Bangladesh/ Apr-28-2011