Part A - Deposit Protection Scheme
Part B - Hong Kong Deposit Protection Board
Part C - Scheme members
Part D - Level of protection
Part E - Depositors protected
Part F - Financial products protected by the DPS
Part G - Disclosure and Representations
Part H - Compensation
Download whole FAQ

Part F - Financial products protected by the DPS
Q47.	What financial products are protected by the DPS?
A47.	Only deposits held in Scheme members are protected by the DPS. Other financial products such as bonds, stocks, warrants, mutual funds, unit trusts and insurance policies are not protected by the DPS.
Q48.	What deposits are protected by the DPS?
A48.	The DPS protects Hong Kong dollar, Renminbi and other foreign currency deposits. Secured deposits are also protected. However, certain deposits such as time deposits with a maturity longer than 5 years, structured deposits, bearer instruments and offshore deposits are not protected by the DPS.
Q49.	Is it possible that the protection status of similar products offered by different banks can be different?
A49.	It is possible because the products offered by different banks may have different terms and conditions, and hence their protection status may be different. However, banks are required to disclose whether your deposits are protected or not. In case of doubt, you can consult your bank for more information.
Q50.	Is it possible that a financial product which is not called or described as a deposit is protected by the DPS?
A50.	It is not common but possible. A financial product which is not called or described as a deposit may fall within the definition of ‘deposit’ under the Banking Ordinance, and hence is protected by the DPS. Please consult your bank whether a financial product offered by it is protected by the DPS.
Q51.	Does the DPS protect deposits which were placed with a Scheme member before the DPS commences operation?
A51.	Yes. Whether a deposit is made before or after the DPS commences operation is not relevant to the Board’s determination of a depositor’s entitlement to compensation.
Q52.	Does the DPS protect the valuables kept in my safe deposit box opened with a Scheme member?
A52.	No. They are not protected by the DPS.
Q53.	Which types of deposits are not protected by the DPS?
A53.	The following types of deposits are not protected by the DPS: structured deposits bearer instruments term deposits with a maturity exceeding 5 years deposits the repayment of which are secured on the assets of the Scheme member off-shore deposits deposits held for the account of the Exchange Fund deposits held or owned by an excluded person
Q54.	What is a secured deposit? Is it protected?
A54.	A secured deposit means a deposit pledged to a bank, normally for the purpose of obtaining a credit facility from the bank. Yes, it is protected by the DPS from 2011.
Q55	What is a structured deposit?
A55.	Structured deposits can take many different forms. Typical examples of structured deposits are foreign currency linked deposits and equity linked deposits. The amounts of principal and/or interest to be repaid for such deposits are linked to the performance of the underlying financial assets.
Q56.	Why are structured deposits excluded from the protection of the DPS?
A56.	Because of the complex features of structured products, it is often difficult to determine whether or not they fall within the definition of "deposit" under the Banking Ordinance, and therefore whether or not they are protected. It would be better to provide absolute clarity to consumers so that they can make their own decisions. Therefore, all structured deposits are excluded from protection.
Q57.	What is a bearer instrument?
A57.	A bearer instrument, in simple terms, is a financial instrument where the holder of the instrument is entitled to the repayment of the money underlying the instrument. A typical example of a bearer instrument is a bearer certificate of deposit, where the holder of the certificate evidencing the deposit is entitled to the repayment of the principal from the issuing bank, whether or not he or she is the person who made the deposit at the beginning.
Q58.	Why are bearer instruments excluded from the protection of the DPS?
A58.	This is a common international practice. The purpose is to avoid abuse of the protection limit (e.g. a holder of a bearer instrument may, after a bank failure, transfer the instrument to another person to increase their aggregate entitlement to compensation).
Q59.	A term deposit with a maturity exceeding 5 years is not protected, how is the term to maturity determined?
A59.	The DPS does not protect time deposits with a maturity exceeding 5 years. The term to maturity of a deposit refers to the current term agreed to by the depositor at the most recent time the deposit was negotiated. It does not refer to the remaining maturity of a deposit. For example, a 6-year term deposit placed with a Scheme member will not be protected by the DPS although the deposit will mature in 3 years.
Q60.	What is an off-shore deposit?
A60.	Off-shore deposits refer to deposits placed with overseas branches of Scheme members.
Q61.	Why doesn’t the DPS protect off-shore deposits?
A61.	Overseas funds have little impact on the stability of the domestic financial system. It is therefore a common international practice not to protect off-shore deposits.
Q62.	What should I do if my bank tells me that a deposit product offered by it is not protected by the DPS?
A62.	You have a choice not to proceed with the transaction.
Q63.	What should I do if I want to proceed with the transaction?
A63.	Your bank will give you a notice that the deposit product is not protected by the DPS and require you to acknowledge that you have received and understand the notice.
Q64.	Can I refuse to give an acknowledgement to the bank?
A64.	If you fail to give the acknowledgement, your bank will refuse to complete the transaction with you.
Q65.	How can I know whether a financial product is protected by the DPS?
A65.	You can ask the Scheme member offering the financial product to you whether it is protected by the DPS.