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EQ Bank Launched - 3% Interest Rate (For now?)
January 30, 2016
5:14 am
netpi
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Yep I was pleased, and surprised, to log on this morning and see the interest credited in the account - not only that but the amount of interest was encouraging considering I only opened the account in mid January - this certainly confirms the policy of paying interest upon receipt of funds as opposed to the ending of the hold period

January 30, 2016
5:31 am
dougjp
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netpi said

Yep I was pleased, and surprised, to log on this morning and see the interest credited in the account - not only that but the amount of interest was encouraging considering I only opened the account in mid January - this certainly confirms the policy of paying interest upon receipt of funds as opposed to the ending of the hold period

None of my online banks have paid yet, why, because it isn't month end yet, so I suggest getting out your calculators and figuring what interest you have been paid for how many days. I wouldn't necessarily be pleased by this development as it suggests another possible systems problem.

January 30, 2016
5:42 am
2of3aintbad
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dougjp said

netpi said

Yep I was pleased, and surprised, to log on this morning and see the interest credited in the account - not only that but the amount of interest was encouraging considering I only opened the account in mid January - this certainly confirms the policy of paying interest upon receipt of funds as opposed to the ending of the hold period

None of my online banks have paid yet, why, because it isn't month end yet, so I suggest getting out your calculators and figuring what interest you have been paid for how many days. I wouldn't necessarily be pleased by this development as it suggests another possible systems problem.

Mine was correct to the cent, to the 31st.

January 30, 2016
5:45 am
netpi
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Actually it's not a system's problem or glitch or anything else - they pay their interest on the last day of the month which is Sunday - the account statement reflects the fact that the interest is credited, and the account balance effective, as of January 31

January 30, 2016
8:41 am
Rick
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Applied Monday the 18th. Funds gone from CDF on the 26th. Account still not active on the 30th. Not at all impressed so far.

January 30, 2016
12:48 pm
LP
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My account hasn't been activated either, nor has my one loonie cheque been cashed. Yet, I already have received a (ROI) return on investment of over $200 with Equitable Group. Yep that's correct, I got a return of 2.54%, in just one day, by buying a few EQB shares on the TSX.
So you see there's more than just one way of making money with EQ Bank.sf-laugh

Analysts' prospectus
Of the six analysts surveyed by Reuters Estimates that cover Equitable Group Inc, the consensus rating is a buy. The rating changed on January 26, 2016 when it was upgraded from a hold.
Based on its net profit margin of 48.75%, Equitable Group Inc is among the more effective companies in its industry at turning revenues into bottom line profit.

So why wait for EQ to email you and activate your account, instead be proactive and invest in the company. The way I see it, with the influx of all the new accounts being opened, now's the time to hitch your wagon to a rising stock.

January 30, 2016
1:15 pm
file
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It... never occurred to me to buy shares in them. I should have done so when I was watching them initially...

January 30, 2016
10:03 pm
Miron
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netpi said

Yep I was pleased, and surprised, to log on this morning and see the interest credited in the account - not only that but the amount of interest was encouraging considering I only opened the account in mid January - this certainly confirms the policy of paying interest upon receipt of funds as opposed to the ending of the hold period

That is how it should be when the end of the month is on weekend... interest is given on Friday!

January 30, 2016
10:19 pm
Miron
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I applied on January 20 and today $1 was gone from my 'other' account... as they said I must wait another 5 business days for the account to be active.

In the same time, ZAG transferred $25 after 4 days and the account is already active!

My new ZAG account still shows $50... I am not complaining :)

Today I opened a new account at DUCA... there is a $5 annual membership fee but they are giving away $50 (plus another $50 to be deposited to a charity of your choice) so I am covered for the next 10 years :)

January 31, 2016
4:22 am
deepcman
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I asked EQ Bank for a commitment on their 3% rate and below is their response. I was looking to see if I could get some sort of commitment before opening an account.
Interesting that it was sent in the middle of the night so you know some of their customer service is in low cost regions. I think I'll sit this one out......

From: contact@care.eqbank.ca [mailto:contact@care.eqbank.ca]
Sent: Sunday, January 31, 2016 2:05 AM
Thank you for contacting us.
Our current everyday interest rate of 3% is not an introductory or promotional interest rate, however, it is subject to change any time, and we cannot promise any time frame.
Sincerely,
Manjinder S
Customer Care Agent

January 31, 2016
6:58 am
Bill
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deepcman, let us know if you've been able to extract a commitment (and for how long - lifetime?) from any other bank re future savings account interest rates. sf-wink

January 31, 2016
11:35 am
Loonie
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What BS! The CEO was quoted in the newspaper as saying they would reduce the rate, basically as soon as they have enough business. Perhaps the next question would be how do they define a promotional rate, and how would we know this is not one? But there's no point. we know the answer.

Having just spent basically the entire day yesterday negotiating with Rogers in regards to phone, internet, cable, I am burned out with any kind of so-called customer service. Two different phones ran out of juice, it took so long, and many issues remain unresolved. At one point we got disconnected, but they, the phone company, did not know why. They were incapable of providing a written contract, yet they will say we have one if push comes to shove and we are deemed bound by it. They have promised features which none of their staff (and we have been through several) can give us working codes for. I know that Bell is no better, as we must regularly negotiate with them on behalf of an elderly relative. This industry is ripe for an Uber-like competitor, it seems to me.

Sorry for the rant, but I am so sick of this kind of corporate behaviour.

January 31, 2016
12:21 pm
NorthernRaven
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Well, "promotional" and "defined time period" aren't quite the same thing. EQ likely has certain internal targets and timelines for deposit base, but there will be uncertainty. Zag would be in the same situation, and has opted to do rolling, time-specific promotions. EQ hasn't. Perhaps some customers will foolishly believe that such a high rate will continue indefinitely, or at least for their own personal definition of "long enough". Since these are demand deposits, can be moved without notice, and generally belong to people who are actively shopping for the best rate, I always feel there's a bit of artificial outrage over some of this.

January 31, 2016
12:51 pm
RicksBank
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I think I'm not alone in believing that processes don't make any progress at banks over weekends. I received an email notice from AcceleRate at 6:31am this morning (Sunday) saying that my $25k cheque to EQ was withdrawn from my account today (Sun, Jan 31).

I imagine this means that I continued to get interest from AcceleRate on the $25k until today? I applied for the EQ account Jan 20. On Friday I received the same email from EQ that others mentioned:

Over the last few weeks, we’ve received an overwhelming response to the launch of EQ Bank and the EQ Bank Savings Plus Account. You and many other Canadians have trusted us with your business, and we truly value and appreciate it.

The EQ Bank team is working hard to get your account activated and you will receive your welcome email 5 business days after your initial cheque has been processed. We apologize for any inconvenience and we plan to have you on board very soon.

I guess we don't know what "processed" means. Some people think it means when EQ acknowledges the photo check deposit (usually the day you opened the account), others when it clears the source bank which in my case is 11 days later.

January 31, 2016
2:03 pm
Loonie
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NorthernRaven said

Well, "promotional" and "defined time period" aren't quite the same thing. EQ likely has certain internal targets and timelines for deposit base, but there will be uncertainty. Zag would be in the same situation, and has opted to do rolling, time-specific promotions. EQ hasn't. Perhaps some customers will foolishly believe that such a high rate will continue indefinitely, or at least for their own personal definition of "long enough". Since these are demand deposits, can be moved without notice, and generally belong to people who are actively shopping for the best rate, I always feel there's a bit of artificial outrage over some of this.

I think everyone knows what a promotional rate is. It's where there is an intention from the outset to lower it later, regardless of any other considerations. And that is the case here.
I understand that rates do change. I am not "foolish" and am not expressing a "foolish belief".
The point is that Eq went out of its way to protest that this was NOT a promotional or introductory rate when in fact it clearly is, even though no date is announced in advance. I wouldn't have cared if they'd just said this is the rate today and is of course subject to change. They are trying to make the unsuspecting person think that the rate might last a while, but in fact there is no commitment to anything beyond today.
I think that reasonable people expect rates to change when market conditions change, e.g. pronouncements from the Bank of Canada. If they are going to change for other reasons, then the offer was a promotion.
Talk like a duck, walks like a duck, etc.

January 31, 2016
2:40 pm
dougjp
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I've noticed there are two general kinds of banks when it comes to rate offers. Those that are competitive most of the time and stable with their rates. These are the banks for "reasonable people (who) expect rates to change when market conditions change".
Then there are the totally noncompetitive banks, that definition based on their normal rates, who offer completely different rates for fairly short periods, whether the expiry is defined or not. Some of these have been mentioned in this thread - Tangerine, Zag, CIBC, PC Financial, Equitable and Canadian Tire Financial's past TFSA rate changes. These are the banks for people who go for the "free newspaper delivery" or "transfer the balance on your credit card" type marketing and bounce around from one place to another, hoping the missing interest during transitions is recouped quickly enough to make the effort worthwhile. IMHO these banks are counting on people forgetting to transfer out when they revert to their usual range of rates for whatever reason. For example they didn't keep a strict diary, didn't notice the rate change, was traveling or busy etc. I've always thought of these banks' marketing approaches as sleazy and hypocritical to their pronouncements.
Unfortunately, even if we are on top of rates 365 days a year, there is the time delay while the account is opened and actively earning interest. I mailed my cheque to EQ on the 20th and haven't heard anything yet, which I see is "normal". Luckily it was only $ 50-. I won't do anything more with them until a joint account is available, I can imagine the nightmare of my wife trying to get money back from them if something happened to me.....

January 31, 2016
4:08 pm
NorthernRaven
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For "Loonie", I didn't intend to refer to you specifically with "foolish". But did you really believe that EQ had come along with a unique business model that could permanently provide HISA rates 125 basis points over the highest permanent Manitoba rates? Short of requiring public disclosure of a candid summary of a company's business plans, or onerous offering requirement son deposit rates, I'm not sure how you forbid a company from doing something like this, or how you would define "a while". How long would EQ have to hold this sort of rate differential to make it acceptable? 3 months? 6 months? A year? Who decides?

"dougjp" - Tangerine/PCF have massive deposit bases - Tangerine has $25 billion in demand savings accounts alone, although a chunk of that would be chequing. Every 10 basis points (0.1%) they raise their interest rate is $2 million a month in additional interest costs. They are never going to have a high base rate again because of this, and they don't need it as long as a preponderance of their base (not just some noisy internet types) stay put. Instead, they'll do promos to target new money, or defend against significant encroachment from PCF or the big banks.

You should also consider that something like a TFSA rate can have different dynamics than a non-registered rate. TFSAs are sticky - you can withdraw, but not re-contribute the same year, and there are usually fees to transfer elsewhere, so these deposits probably stay put and look more like short-medium term GIC funding for banks eyeing liability matching. Also, TFSAs are recent and have had limits, so much less money is involved and a high interest rate is less expensive to the bank compared to its publicity value - thus Peoples Trust long-time high TFSA-only rate.

January 31, 2016
4:18 pm
JustMe
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Miron said

I applied on January 20 and today $1 was gone from my 'other' account... as they said I must wait another 5 business days for the account to be active.

In the same time, ZAG transferred $25 after 4 days and the account is already active!

My new ZAG account still shows $50... I am not complaining :)

Today I opened a new account at DUCA... there is a $5 annual membership fee but they are giving away $50 (plus another $50 to be deposited to a charity of your choice) so I am covered for the next 10 years :)

Holy smoke man. How many penny accounts do you have? Did you open account at EVERY single bank/credit union in Canada with $10? Did you try Albanian banks? They might pay higher interest? Angola, Burundi?

What is the point of this miserable interest chase? Get 500K into one of Manitoba CUs and enjoy. Stop ambulance car chase... Get life. Duh...

January 31, 2016
5:22 pm
Loonie
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NorthernRaven said

For "Loonie", I didn't intend to refer to you specifically with "foolish". But did you really believe that EQ had come along with a unique business model that could permanently provide HISA rates 125 basis points over the highest permanent Manitoba rates? Short of requiring public disclosure of a candid summary of a company's business plans, or onerous offering requirement son deposit rates, I'm not sure how you forbid a company from doing something like this, or how you would define "a while". How long would EQ have to hold this sort of rate differential to make it acceptable? 3 months? 6 months? A year? Who decides?

I only ever asked for honest language. I never said I expected a permanent rate. An example would be "We are able to offer 3% interest at present, but this rate cannot be guaranteed." They shouldn't be pretending it's not a promo or introductory rate when it clearly is. They won't say this, of course, because it's less appealing.

I know nothing about their business model. However, we have banks like TD offering 0.55% on "high interest" savings accounts while the going rate at many other institutions is 1.75%, a difference of more than 3x, so who am I to say whether they can sustain 3% or for how long, with a different business model? they are certainly down to bare bones, offering only one kind of account. I can't think of any other FI that is doing that at the moment. Conventional mortgages may not be their market. However, the CEO has already decided in advance to lower the rate; he just didn't want to mention that up front..

January 31, 2016
5:43 pm
Miron
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JustMe said

What is the point of this miserable interest chase? Get 500K into one of Manitoba CUs and enjoy. Stop ambulance car chase... Get life. Duh...

I just want to believe you are kidding! Do you really think I would open an account to deposit there $1 only? Why would I use more for an initial deposit!? Most wise people do exactly that!
Why would I keep more than $1 in my checking account waiting who knows how long to be transferred? i can transfer more later after the 2 FI are connected!

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