Our sales team serves key foreign and domestic institutional clients, including mutual funds, pension funds, brokerage firms, and insurance companies, with money and capital market products.
With our expertise and many years of experience as well as our wide range of products, we assist our clients investing in the domestic, regional and global markets.
In recent years, OTP Global Markets has proven itself to be the best foreign exchange provider on the Hungarian market on several occasions, and most recently won the Global Finance Best Foreign Exchange Providers award for the 14th time in 2019.
Spot deal
We strive to serve our clients with less frequently available currency pairs in addition to the more well-known currency pairs, be it physical delivery or transactions with a financial settlement.
- Settlement within a day (even within half an hour)
- Reduced exchange rate risk, making cash flow more predictable
- Execution of market orders
Forward foreign exchange - FX forward
The buying or selling of foreign currency for a future date against another, predetermined currency, at the fixed exchange rate and quantity applicable at the time of the transaction. This provides a simple solution for fixing the currency conversion rate due in the future, thereby making it easy to plan future cash flows.
- The forward exchange rate reflects the difference between the interest rates of the two currencies
- Prior to the occurrence of the future date, the transaction can be easily closed with a reverse transaction, with net settlement at maturity
- Products flexible in time (settlement can be brought forward or the position can be rolled over in time)
- The transaction entails a performance obligation for the client: the client is obliged to buy/sell at the fixed exchange rate even in case of lower/higher maturity exchange rates than the fixed exchange rate, i.e. they may realize unlimited exchange rate losses
Foreign exchange swaps - FX swap
The foreign exchange transaction basically includes the immediate (spot) buy/sell of given currencies and the future buy/sell of the same currencies in the opposite direction. A foreign exchange transaction can be interpreted as a combination of a spot transaction and a forward transaction (fx forward) or as two forward transactions.
- The transaction is a cost-effective way of managing liquidity needs arising in various currencies. The market value of the transaction is affected by the movement of the spot exchange rate and the relative change in the interest levels of the two currencies for a given maturity.
- The deal can be easily closed with a reverse contract and the maturity can be advanced or moved further away in time (rolling), i.e. the maturity of the hedging deal can be adjusted to the actual cash flows.
FX options - vanilla
As a buyer of a currency option, in exchange for the payment of a predetermined fee (option premium), the buyer acquires the right to buy (call option) or sell (put option) a predetermined quantity of foreign currency at a predetermined strike rate and value date, while the seller incurs an obligation in exchange for the received premium to perform at the predetermined contract price.
- In the case of a buy position, this entails a potentially unlimited profit and a maximized (premium amount) loss in the event of a possible unfavourable change in the exchange rate
- Numerous alternatives for developing individual strategies
- Riskier than futures transactions, but compared to cost-free foreign exchange transactions, our clients can benefit to a greater extent from favourable exchange rate movements, as the exchange rate is not fixed
Barrier options
There are two types of barrier options: knock-in and knock-out options. The transaction may have one or two barrier rates. If the market price reaches the knock-in level, a vanilla option comes about, while conversely, at the knock-out level, the vanilla option terminates and the rights and obligations arising from the option are also terminated.
- They are more cost-effective than vanilla options with similar properties, and are therefore attractive to the buyer of the option
- There are lower losses if the price does not reach the expected level and higher profits materialize if it does
- A more favourable exchange rate can be attained with a foreign exchange forward transaction, assuming additional risk
- Recommended for clients who do not expect significant exchange rate changes
- In the event of a significant exchange rate movement, the hedging position is also terminated with the termination of the knock-out option
Option strategies
We develop personalized strategies for our clients, consisting of several options, if, for example, they wish to profit from the increase in the exchange rate of the underlying product, or if they want to sell or buy a specific currency at a more favourable level than the "market" forward rate.
Dual-currency structured investments
With a dual-currency structured investment (Dual Currency Deposit), much higher returns can be realised than the deposit interest, while assuming the risk that the capital will be converted to another currency at a predetermined exchange rate at the end of the investment. Investment without capital transfer, guaranteed return (but not capital guaranteed).
- The yield of the product consists of two elements, a deposit interest and an option premium.
- In exchange for a higher return, the client assumes a higher risk.
- On the 2nd working day before the expiration date (exchange rate monitoring day), it is decided whether the investment remains in the original currency or is converted to another currency at the exchange rate agreed upon when the transaction was concluded.
- Return-guaranteed investment, the return expressed in the currency of the investment is received by the client on the second working day after the transaction.
The OTP Group's interest risk management experts are at the service of our clients who wish to cover their interest rate risks with products adapted to individual repayment schedules, whether it is for loans with fixed or variable interest rates.
Interest Rate Swap - IRS
With the help of interest rate swaps, as an institutional client, you can exchange a loan with a variable interest rate for a fixed interest rate, or vice versa. In the case of a hedging transaction, if we fix the interest rate, the maturity and the value of the relevant loan, future cash flows can be calculated. The capital does not change hands, only the interest, so the partner risk is moderate.
Cross-Currency Interest Rate Swap - CCIRS
A variant of interest rate swaps where the interest rates of two different currencies are exchanged. In the transaction, in addition to the interest, capital is also exchanged at a pre-fixed exchange rate, both at the start of the transaction and at the expiration date. With the help of the product, for example, a HUF loan can be synthetically created from a loan in another currency and by concluding the CCIRS. In the transaction, both fixed and variable interest rates in two different currencies can be exchanged.
Interest rate options
In exchange for the payment of the option fee (premium), the interest rate option, similar to the currency option products, offers our clients protection against unfavourable changes in the interest rate environment, while they can benefit from the interest rates favourable to them.
Forward Rate Agreement - FRA
A forward rate agreement is similar to a currency forward transaction. In the transaction, one party borrows or lends a predetermined amount of money, with a predetermined interest rate and maturity.
Commodity market transactions provide a hedging opportunity for clients who wish to reduce the risks arising from the rapidly changing exchange rates of raw materials. Our products include energy carriers (crude oil, refined products, natural gas), precious metals (gold, aluminium, copper), as well as agricultural products (wheat, corn, rapeseed).
Commodity swap transactions
The price of a raw material buy or sell due at a future date or period can be fixed with a commodity swap transaction.
A commodity swap transaction is an agreement based on which two parties exchange their cash flows over a predetermined period. A party exchanges a fixed-rate liability or claim for one expressed in a variable price depending on the evolution of the exchange rate for the specified commodity product.
We have a product range covering a wide spectrum of securities transactions, including both products introduced to the regulated market and traded on the over-the-counter (OTC) market. The securities we trade in are registered in a dematerialized form, in a securities account.
Discount Treasury Bills
Discount Treasury bills are Hungarian government securities with a maturity of less than one year, that do not pay interest, but – as their name suggests– are issued at a price lower than their nominal value, at a so-called discount rate. When discount treasury bills expire, the face value is paid to their owner. They are typically publicly issued through an auction; the face value of a treasury bill is HUF 10,000.
In the primary market, the paper is usually sold with a term of 3 or 12 months, while on the secondary market, customers can choose from a range of maturities within one year.
Government bonds
Government bonds are debt securities issued by the state to acquire funds. At the time of issue, the government bond has a maturity of more than 1 year. In the event of buying a government bond, the buyer provides a loan to the state with a predetermined amount and date. In return, the state pays a fixed interest on the investment at specific intervals. The invested amount is repaid by the state at the maturity of the government bond.
Corporate bonds
Debt securities issued by companies of various sizes and risk ratings. The main difference compared to government securities is the identity of the issuer and the resulting difference in the risk profile: the yield on corporate bonds is typically higher than the yield on government securities, which is associated with their credit rating.
Our clients can trade bonds from several domestic and foreign issuers, and with the help of our staff, they can find the securities that best suit their investment goals.
Discount treasury bills, government bonds, and corporate bonds all have the following risks: credit, inflation, exchange rate, and liquidity risk. In all three products, it is possible to buy domestic and foreign instruments.
Shares
Thanks to the bank's stock exchange membership, we have direct access to the Budapest Stock Exchange and Deutsche Börse A.G. regarding XETRA. Additionally, through our international execution partners, we can reach many stock exchanges around the world (American, Eastern European, Canadian, etc.).
Investment certificates
We provide our custody clients with access to a portfolio of hundreds of investment certificates issued by international fund managers, covering a wide range of risk categories (from money markets to hedge funds), through the Vestima system operated by Clearstream Banking S.A.
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If you want to be our client
Call our colleagues on plusz+36 1 288 7551
Choose the services of OTP Global Markets
The experienced experts of OTP Global Markets
will help you successfully implement your investment strategy with personalized
advisory services.
Attila Preisz
Head of Department
Zoltán Ballai
Deputy Head of Department
Péter Nagy
Senior Sales
Lilla Zsuzsanna Mohos
Sales
Csinszka Kis-Böndi
Sales
Useful documents
These documents in English language to the person concerned
shall be for information purposes only. OTP Bank Plc shall fulfil its obligations imposed by the
legal regulations or requirement of supervisory authority by the documents in
Hungarian language.
In the
event of any discrepancy between the English language and Hungarian language
versions, the Hungarian language version shall prevail.
Information on the suspension of the market making obligation (available only in Hungarian)
Cross-Currency Interest rate swap
Dual currency structured investment
Forward deal in precious metals (gold and silver) transaction
Long-Term Investment Account T+3 FORWARD
Stock exchange spot transaction
Securities Lending Transaction
Senior Preferred Debt Securities Qualifying as Eligible Liabilities issued by OTP Bank plc
Notice on the uEMIR Notice se of LEI CODES
Disclosure of information pursuant to Article 11 (11) of the EMIR Regulation
Information for Clients on MiFID
Global Markets ex-ante cost transparency information (available only in Hungarian)
Systematic internaliser - quotes
Notice on the use of LEI CODES
Direct and indirect clearing services in respect of certain derivative transactions announcement
Notice - on the impacts of the pandemic emergency on the money and capital markets
Terms and conditions
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