Spot and Forward Foreign Exchange
With the KBC Bank NV branch network, KBC Bank Ireland can provide our clients with global foreign exchange rates quickly and accurately.
The KBC Bank NV branch network operates 24 hours a day so we can competently handle or manage orders from our clients.
Spot foreign exchange
A spot contract is a binding contract to buy or sell an amount of foreign currency at the current market rate, for settlement in two business days' time. To enter into a spot deal we require the following three pieces of information to be provided: the amount, the two currencies involved and which currency to buy or sell.
Forward exchange contracts
A forward exchange contract (or forward contract) is a binding obligation to buy or sell a certain amount of foreign currency at a pre-agreed rate of exchange, on a certain future date. To take out a forward contract you need to provide the amount, the two currencies involved, the expiry date and whether to buy or sell the currency. It can be possible to build in some flexibility to allow the purchase or sale of the currency between two pre-defined dates rather than a single maturity date.
Foreign Exchange contracts
- Guaranteed rates of exchange
- Adverse currency moves are eliminated
- Funds only exchanged at contract maturity
- Cash flow certainty.
This contract does not allow any benefits from preferential rate moves.
Before entering into a forward contract a credit line will have to be approved and will be subject to an annual review.
Our experts in the Treasury and Capital Markets division will be very happy to discuss this product with you in more detail if it is something that you believe may be advantageous for your business.
