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Email this6:39 am
December 20, 2019
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ING Direct
PC Financial
Anyone know of any other great losses?
Since the buyout of ING with Scotiabank and PC Financial rebrand to Simplii from CIBC these banks are a shadow of who they were.
Sure they don't charge the fees and I do appreciate that for an everyday account but with interest rates they simply play games.
Example...
Simplii - we will give you 2% on savings until whenever. You move the funds in and a few months later get told you were not signed up. They give you another offer and you accept but they date it in such a way that the 30k you had in the account weeks back does not count. Oh it has to be something over and above that amount.
Same with Tangerine.... move funds in, move funds out but not good enough you have to have funds out for longer periods of time.
Then you have the new players like Motus who are pretty decent but you can tell they will be exactly the same as Simplii when the interest rate drops stop. Owned by Meridian Credit Union it's just a matter of time before the standard rates match Simplii and the likes.
Then there is Motive, always good stable rates but a huge drop from 2.8 to 2.05 makes me thing another big one is on the way. Don't talk to me about the website, it's lacking in every way and their app is the worst I have ever seen. Then the fact that you cannot deposit a check makes it feel like it's 1999 all over again.
Surprising thing is LBC and B2B, yes big drops to 1.6 but steadily ahead of motus bank and considering all 3 are new players I am gambling on LBC a bit. B2B is too hard to deal with and LBC is more open and for everyday banking they may just end up being better than Motus.
By better I mean better rates, the website needs to become more reliable but the functionality is pretty decent. That said I find the motus website the second best I have ever used and right behind Simplii who in my opinion has the easiest website of them all. That said you have to click around for rates and such and on motus it's all displayed in your account.
Yikes.... I had to get some of this of my chest, glad I found some folks who like to discuss such things.
7:37 am
February 27, 2018
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KamWest, here's another one for you, Phillips, Hager and North. They were bought by RBC, the moment Royal Bank announced their intentions, i pulled every penny i had with PH&N.
7:48 am
May 27, 2016
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I was a big fan of Ally Bank when they were in Canada, then RBC came along in 2013 and bought them out and shut down their HISA business to eliminate the competition
8:10 am
December 20, 2019
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Yes Ally was my favourite, I was so disappointed when they were bought by RBC, such a loss.
8:30 am
February 17, 2013
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If you want to crank the way-back machine a few decades...was not happy when HSBC took over the Bank of BC. Ally was a disappointment, ING takeover was the end of a era.
Don't think it's fair to call out Motive...they kept their rate higher sooner and longer than I expected. Still near the top of the pack with their HISA account. Just a victim of the times. Despite their shortcomings...still my go-to FI
Simplii is just a clone of Tang with their offers...just seem a little sleazier to me.
Given up signing on to every new kid on the block with enticing intro rates (LBC B2B etc). EQ was the last one to pull the bait and switch on me.
11:07 am
April 6, 2013
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The issue with being owned by Scotiabank or Royal Bank is that one now has access to funding at a much lower rate.
Royal Bank has a DBRS debt rating of AA(high). Bank of Nova Scotia has a rating of AA. Those ratings are up there with the provincial governments and allows them to issue bonds at provincial government bond rates.
So, there is no real need for a subsidiary like Tangerine Bank or the former Ally Financial to pay high rates for deposits, except for marketing purposes.
12:48 pm
October 21, 2013
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So, what you are saying, Norman, is that, from a consumer-saver point of view, there is not "real need" for these banks to exist. I am doing my part to make sure they don't as I treat them the way they treat me. When I am superfluous to them, they are superfluous to me.
This sort of thing will continue to happen, but, so far, there have also always been new opportunities.
6:31 pm
April 6, 2013
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For a retail banking consumer, the no-fee banking they offer is welcome. For the rate chaser, there isn't as much.
The owner of Tangerine Bank and the bank behind Simplii Financial both have cheaper sources of funding. So, there is not much justification for them to keep their rates up in contrast to a competitor like EQ Bank.
8:31 pm
October 27, 2013
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Norman1 said
The issue with being owned by Scotiabank or Royal Bank is that one now has access to funding at a much lower rate.Royal Bank has a DBRS debt rating of AA(high). Bank of Nova Scotia has a rating of AA. Those ratings are up there with the provincial governments and allows them to issue bonds at provincial government bond rates.
So, there is no real need for a subsidiary like Tangerine Bank or the former Ally Financial to pay high rates for deposits, except for marketing purposes.
Except it is my view that the big banks know the big digital tsunami is coming and having the likes of Tangerine and Simplii around are a way to have toes in the water and boots on the ground to 'feel' what is going on. Dont think they are expecting much else from these online offerings at the moment.
My sons, who are with big banks, know banking will be very different within 10 years but no one is really clear on what that looks like in retail banking. An even bigger question is in small business banking when many businesses have barely graduated from the abacus.
11:12 am
April 6, 2013
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The problem with the "disruptors" is they have no money.
One can't lend out $1 billion without having $1 billion to lend. Those shaky fintechs are lucky if they have enough money to cover their own payroll for the next 12 months. So, they are in no position to take on a bank like the Royal Bank for lending.
The alternative banks are not in a position either. I remember Equitable Bank CEO Andrew Moor commenting that they are not really competing with the big banks, like TD Bank. The big banks know that as well. He noted that TD Bank's brokerage subsidiary actually sells a significant amount of Equitable Bank GIC's!
11:36 am
October 27, 2013
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So the fintechs will always be somewhat fringe players? Good for the retail consumer like folks here trying to pick away for a few extra bucks but this would suggest even the fintechs will have to continue to consolidate to remain profitable/survive.
11:39 am
October 29, 2017
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I agree with Norman1. There are really only two things that get us decent rates. One is, that human nature is to get more business so you can hopefully make more profit and the other is more competition.
If the big banks keep buying up the online-banks, then there isn’t much hope.
12:06 pm
October 27, 2013
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Except the fintechs do not have scale to make much of a dent. Margins are no doubt razor thin.
Which is why so many of them have poor customer service, amateur websites and limited offerings. They are storefront operations maybe run out of a garage.
12:59 pm
August 1, 2015
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In regards to credit cards I'd be rather interested in seeing how Brim is doing in the market for revenue since they don't have such a large backing.
1:14 pm
October 29, 2017
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Yes, I think this is a niche market on the fringes.
It is easily seen through the Desjardins attempt with Zag. Desjardins has the scale, yet they shut Zag down. They probably couldn’t make enough profit off the deposits to cover the costs to operate. And any loans or mortgages that could perhaps have been acquired, could just have been done through the regular channels that already existed. In other words, they don’t need to offer high interest, it’s the small operations and start-ups that want your deposits.
Hence, this wonderful site to display them for us.
7:39 am
April 6, 2013
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AltaRed said
So the fintechs will always be somewhat fringe players? Good for the retail consumer like folks here trying to pick away for a few extra bucks but this would suggest even the fintechs will have to continue to consolidate to remain profitable/survive.
Not sure consolidation would help. Consolidating three fintechs with no money, for example, will end up with one company that still doesn't have any money!
It may not matter with some of the alternative banks as their goal was never to "change the world." Equitable Bank, for example, just wanted to diversify their deposit accepting channel with EQ Bank. I suspect EQ Bank has met their goal for them.
10:03 am
October 29, 2017
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We will get better rates with more competition, so consolidation would most likely lower rates.
1:43 pm
October 29, 2017
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It should also be noted, that deposits aren’t as big of a resource as they once were. Canada used to be a nation of savers, but as of September last year, 53% of Canadians live paycheque to paycheque. Retirement savings aren’t the priority anymore. So any given FI trying to get funds, won’t be getting billions of dollars from HISAs.
It’s debt that makes money for FIs, they want loans, mortgages and credit cards.
Here is a good article about Canadians and finances:
https://www.investmentexecutive.com/news/research-and-markets/majority-of-canadians-living-paycheque-to-paycheque-survey-2/
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