Bank of China: Crude Oil Treasury shifts or spreads in a pre-specified manner before the due date

Bank of China: Crude Oil Treasury shifts or spreads in a pre-specified manner before the due date
Sauna Night News investors suffered huge losses when investing in Bank of China crude oil products, causing market controversy.In this regard, the Bank of China issued a statement on the crude oil treasure business on the evening of April 22.Bank of China stated that crude oil treasure products are linked to overseas crude oil futures, similar to futures trading operations, according to the agreement, the contract will be terminated on the contract expiration processing date, in accordance with the customer’s pre-specified method, to carry out a position shift or due rolling difference processing.The following is the statement of the Bank of China on the crude oil treasure business statement issued by the Bank of China. Regarding the customer’s concern about the Bank of China crude oil treasure business, the following is now explained: 1. Regarding crude oil treasure products BOC launched the “Crude Oil treasure” product in January 2018Provide domestic individual customers with trading services linked to overseas crude oil futures, and customers make trading decisions independently.Among them, the US crude oil varieties linked to CME’s first contract of WTI crude oil futures.Individual customers conducting “Crude Oil Treasure” are required to submit 100% margin, sustainable leveraged transactions.2. Regarding the expiration processing of crude oil products linked to overseas crude oil futures, similar to the futures trading operation, according to the agreement, the contract will be terminated on the contract expiration processing date, in the manner specified by the customer in advance, or the position will be moved.Expired settlement.Among them, the position shift refers to all current contracts held by the closing client; while the opening margin refers to all current contracts held by the closing client only.3. With regard to the settlement price, according to the agreement, when performing the “shifting and spreading” operation mentioned in Article 2 above, the contract settlement price shall be announced by BOC, with reference to the settlement price of the corresponding contract announced by the futures.The futures exchange calculates the settlement price of the day according to the average price of 2:28 am to 2:30 am Beijing time.Fourth, regarding the processing of the WTI crude oil futures May contract in accordance with the agreement and announced in advance, April 20 is the last trading day of the month of the May contract of crude oil US crude oil, and the transaction termination time is 22:00 Beijing time.In the early hours of April 21st, Beijing time, WTI crude oil futures May contract prices fell sharply, falling to an unprecedented minimum of -40 dollars.The settlement price announced on the day was -37.$ 63, the first negative settlement price since the listing of the Chicago Mercantile Exchange Group WTI crude oil futures contract.In order to rule out that the negative settlement price on the day is due to the abnormal price of the exchange system and other abnormal reasons, BOC actively contacted the Chicago Mercantile Exchange and market participants to verify, so the trading of crude oil products of the US oil contract was suspended for one dayDoes not affect customer rights.At present, the main participants will still settle with reference to the settlement price according to the exchange rules.We have completed the expiry of the May contract based on advance agreement.Fifth, regarding the forced liquidation of crude oil products, when the market price is not negative, the long position will not trigger a forced liquidation.For those who have determined to enter the position shift or expired rolling difference processing, the termination processing will be completed for the customer at the settlement price, no longer pay attention to the market, strong level.Hereby, Zhao Ze, editor of Sauna Night Net, Bank of China Limited, April 22, 2020