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May 6, 2022
9:38 am
frugal lady
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DUCA CU requires a $100,000 deposit for the 1 year 3.58% and Haventree Bank also offering 1 year 3.58% as per email from GIC Wealth this morning. Not sure minimum required for Haventree.

May 6, 2022
10:19 am
JenE
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This is what I received from GIC Wealth today. I don’t know the FIs, but it seems clear that the 1 year, 3.58% rate is for $25,000 min., and, in fact, no mention of $100,000. Bit of a mystery!

1 year 3.58%*
18 month 3.55%*
2 year 3.78%*
30 month 3.80%**
3 year 4.05%**
4 year 4.05%**
5 year 4.10%**
* Minimum Investment $25,000
** Minimum Investment $50,000
*** Minimum Investment $100,000

CDIC Deposits Insured up to $100,000 FSRA Deposits Insured up to $250,000 Assuris Deposits Insured up to $100,000
Rates are subject to change without notice.
Certain minimums may apply. Call for details.
E&OE.

May 6, 2022
11:12 am
frugal lady
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JenE said
This is what I received from GIC Wealth today. I don’t know the FIs, but it seems clear that the 1 year, 3.58% rate is for $25,000 min., and, in fact, no mention of $100,000. Bit of a mystery!

The $100,000 minimum was only referring specifically to Duca CU 1 year @ 3.58% in post 61 and it could be that Haventree Bank at 3.58% is a minimum is $25,000.

May 6, 2022
11:13 am
Norman1
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The DUCA one-year GIC rate of 3.58% for $100,000 can be seen at deposit broker Fiscal Agents:

Institution Amount 1 year
DUCA $100,000 3.58%
$25,000 3.50%
$5,000 2.50%

We don't know for sure if DUCA is really offering a $100,000 rate. It could be that Fiscal Agents is willing to assign 0.08% of the customary ¼% per year brokerage commission for the $25,000 rate to the GIC purchaser if the purchaser is willing to buy $100,000+.

0.25% - 0.08% = 0.17% of $100,000 is $170. That isn't bad compensation for doing the paperwork for a one-year $100,000 GIC.

May 6, 2022
12:42 pm
Loonie
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If 0.17% is a reasonable cost of transacting a 100,000 GIC, then why is DUCA paying an extra 1.88% ($1880sf-surprised) plus broker's commission for people NOT to buy directly?
For an institution obsessed with the slogan, 'Do more, be more, achieve more", it doesn't smell good.
I know the FIs make non-compete agreements with the brokers in order to give the brokers a chance to gather in large amounts for them but there is no excuse for such a large gap. They are telling people to "go away" in order to do more, be more, achieve more.

May 6, 2022
2:24 pm
savemoresaveoften
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Norman1 said
The DUCA one-year GIC rate of 3.58% for $100,000 can be seen at deposit broker Fiscal Agents:

Institution Amount 1 year
DUCA $100,000 3.58%
$25,000 3.50%
$5,000 2.50%

We don't know for sure if DUCA is really offering a $100,000 rate. It could be that Fiscal Agents is willing to assign 0.08% of the customary ¼% per year brokerage commission for the $25,000 rate to the GIC purchaser if the purchaser is willing to buy $100,000+.

0.25% - 0.08% = 0.17% of $100,000 is $170. That isn't bad compensation for doing the paperwork for a one-year $100,000 GIC.  

well i suggested to Duca saying I was looking at 1y for 3.5% (exact) and will do 50 (not knowing what Norman posted.) Response was their rate being 1.7% for 1y. Its lame no matter how one looks at it...

May 6, 2022
3:48 pm
Norman1
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Not sure what the issue is with DUCA. Their 1.7% right now on one-year non-cashable term deposits is not competitive.

RBC Royal Bank is offering a special 1.8% on cashable one-year GIC's and a special 2½% on non-cashable one-year GIC's.

I'd say DUCA wasn't interested in one-year funds. But, then why offer around 3½% for one-year funds through GIC Wealth and Fiscal Agents?

May 6, 2022
4:02 pm
Norman1
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Loonie said
If 0.17% is a reasonable cost of transacting a 100,000 GIC, then why is DUCA paying an extra 1.88% ($1880sf-surprised) plus broker's commission for people NOT to buy directly?

 

The reality maybe that DUCA is not paying that much extra overall.

It could be as savemoresaveoften described. There maybe many DUCA members who don't shop around and who accept the 1.7% on a one-year GIC. Such members may find it objectionable to check out that "evil, profit hungry" RBC Royal Bank and miss the special 2½% on one-year GIC's there. sf-laugh

DUCA just needs a bit more one-year funds than from that and is trying raise that extra bit through deposit brokers at around 3½%.

May 6, 2022
9:39 pm
Loonie
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Your bias is showing, Norman. Why settle for a dismal 2.5% GIC at RBC when you can get up to 3.3% elsewhere and about half of issuers on the GIC chart (and a few that aren't) offer 3% or more? - and that doesn't even include deposit brokers. Even CIBC offers more last time i looked.

As for DUCA, with a savings rate of 2.5% that has been raised twice this year already and will run to Dec 31, it's not too likely they are selling very many one year GICs at 1.7%. It's hard to even find the rate on their website.

DUCA's problem is not that members won't provide the funds they need. DUCA hasn't made any effort whatsoever to convert members' deposits to one year GICs at ANY rate.
If they had offered 3.5 or 3.58, even with a minimum, people would have bought; I would have bought. They didn't even try before passing the file over to deposit brokers, and I bought elsewhere. That is insulting to members - but not as insulting as the crappy rate over at RBC being promoted as "Special".

It's RBC who is trying to fool their loyal customers with a "Special" rate that is well below many others. DUCA is keeping quiet about theirs.

May 7, 2022
7:38 am
Norman1
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It's not bias. It's reality.

RBC knows its market and prices its GIC's to bring in the amounts they want. It is no secret to RBC what others are offering. Another competitor can have the few people who insist on more than 2½%.

Pretty stupid to pay 3% or more when one can bring in what is needed for 2½% or less. It is a game where the prize are the deposits and not how close to the top one places in GIC rate charts.

No, DUCA members cannot provide the funds DUCA needs. That's why DUCA works with deposit brokers. You are giving yourself way too much credit!

People who keep funds in savings accounts instead of in a one-year or longer GIC's do so for good reasons. DUCA likely found it was futile in the past to try to convert savings deposits to longer term deposits. Most of those savings deposits were not parked funds waiting for higher GIC rates.

May 7, 2022
1:25 pm
turquoise
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Norman1 said
No, DUCA members cannot provide the funds DUCA needs. That's why DUCA works with deposit brokers. You are giving yourself way too much credit!

Credit unions like to advertise that they are categorically more ethical than conventional banks. In some ways they are -- but in others they aren't.

Credit unions that need to raise funds could open it up to both members and deposit brokers. They don't, because they don't have to -- and because they have no problem with the circumstantial ethics involved.

For example, Mario is a member of We Love Members CU. He has been a member for 10 years, has a mortgage, a line of credit, a RRSP, an RESP, and a WKRP in Cincinnati. He is repeatedly told through emails that he is a valued member. He is offered a 5-year GIC at 3.5%.

Luigi has never even heard of We Love Members CU. In fact, if he could somehow make money by helping put We Love Members CU out of business, he would. He has a few hundred thousand in cash. He calls a deposit broker and gets offered a 5-year GIC at 4%.

We Love Members CU does not have any problem with this, and does not believe it has any obligation at all to Mario, even though he "is an owner."

Maybe you say "so, what's your point?"

Well, if you do, then you are actually making my point.

May 9, 2022
9:42 am
JenE
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GIC Wealth this am:

1 year 3.63%*
18 month 3.70%*
2 year 3.80%*
30 month 3.85%*
3 year 4.05%**
4 year 4.05%**
5 year 4.10%**
* Minimum Investment $25,000
** Minimum Investment $50,000
*** Minimum Investment $100,000

May 9, 2022
11:24 am
MattS
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We can get 4.10 on our own.. Deposit brokers need to up the ante

May 9, 2022
3:27 pm
turquoise
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MattS said
We can get 4.10 on our own.. Deposit brokers need to up the ante  

People's Trust is already 4.15 for 5 years.

I've never GIC seen rates rise this quickly before. Is it too much to hope for a 7% GIC by the end of the year?

May 12, 2022
7:22 am
frugal lady
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When you purchase a GIC through GIC Wealth what do you get to confirm your transaction, and who is confirmation received from GIC Wealth or the FI?

May 12, 2022
7:39 am
savemoresaveoften
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frugal lady said
When you purchase a GIC through GIC Wealth what do you get to confirm your transaction, and who is confirmation received from GIC Wealth or the FI?  

They send out paper confirmation and fwd the FI's paper work but it can take upto 1 month.
They also have a portal setup that you can look at it on their web site.

May 12, 2022
9:20 am
hwyc
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In corroboration, I also look to the cheque image (downable) from my bank.

(Thank you Loonie for the correction)

May 12, 2022
9:32 am
Loonie
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hwyc said
In collaboration, I also look to the cheque image (downable) from my bank.  

I think you meant to say "corroboration". "Collaboration" might give the wrong impression.

May 12, 2022
9:34 am
canadian.100
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turquoise said

I've never GIC seen rates rise this quickly before. Is it too much to hope for a 7% GIC by the end of the year?  

If you are hoping for 7% GIC by year end, you must also be hoping for an inflation rate of around 10%. Maybe that is not impossible since inflation in US exceeds 8% and Canada can not be too far behind.

May 12, 2022
10:15 am
Loonie
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Inflationary pressures abound and are multiplying like rabbits. The question in my mind is what , if anything, would stop GICs from going to at least 6% this year? I suspect it's beyond the capacity of BoC. Maybe would require legislation, which would likely also be unpopular.

Ever-increasing GIC rates may look good in theory, but the gap between inflation and GIC rates is significantly wider than last year. As long as that gap remains, higher GIC rates will still cost you. We were doing better last year, at least in this household.

I'm annoyed, but still lucky as it is all bonus income for us; we don't depend on it. It's really rough for those who do depend on it as they are the ones who can't afford greater risk or volatility in investments.

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