FREQUENTLY ASKED QUESTIONS
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Why does the underlying principle for Premier/Advance Account-i need to be changed from
Wakalah (Agency) to Wadiah (Safekeeping)?
The underlying principle needs to be changed to enable Premier/Advance Account-i to remain
classified as a deposit under the new Islamic Financial Services Act 2013 (IFSA). If not, the
Premier/Advance account-i will be deemed as investment accounts.
Why is there a need now to reclassify the Premier/Advance Account-i as a deposit?
Previously, under the repealed Islamic Banking Act 1983, deposits received by Islamic banks
from customers comprised of both deposit and investment products.
However under IFSA (which came into force on 30 June 2013), Islamic banks are required to
clearly differentiate between deposits and investment accounts in terms of the underlying
principle.
Which underlying principles are classified as deposits?
There are three types of the underlying principles that can be classified as deposits, namely (i)
wadiah (safekeeping), (ii) qard (interest free loan) and (iii) tawarruq (monetization).
Which underlying principles are classified as investment accounts?
There are two types of underlying principles that can be classified as investment accounts and
these are (i) investment based on partnership or profit/loss sharing
(Musharakah/Mudharabah) and (ii) agency (Wakalah).
Is my deposit in the Premier or Advance Account-i principal guaranteed?
Currently, your Premier/ Advance account-i based on underlying principle of wakalah (agency)
is eligible for protection by Perbadanan Deposit Insurans Malaysia (PIDM). However, starting
July 2014 under IFSA, the underlying principle of wakalah (agency) will not be eligible for
protection by PIDM.
Therefore after this change of the underlying principle to wadiah (safekeeping), your
Premier/Advance account-i will remain eligible for protection by PIDM.
Can I continue to operate my account as usual?
Yes. You will be able to continue operating your account in the same manner as you normally
do.
Do I need to come to the branch to take effect on the change?
No. However, you can visit any HSBC Amanah or HSBC Bank branch to discuss options available
before 29 August 2014. Alternatively, you may call our Call Centre at 1300 80 2626 for
assistance.
Will there be any additional charges or cost imposed on me for the change of underlying
principle of my Premier/Advance Account-i?
No.