1 yr = 5.10%, 2 yr = 5.15% (via Scotia iTRADE) | HSBC | Discussion forum

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1 yr = 5.10%, 2 yr = 5.15% (via Scotia iTRADE)
November 7, 2022
3:10 pm
Norman1
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At Scotia iTRADE, HSBC Bank Canada was leading in one- and two-year GIC's today:

Issuer 1 year 2 year 3 year 4 year 5 year
HSBC BANK CANADA 5.10 5.15 5.00 4.85 4.85
November 8, 2022
4:45 pm
Koogie
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They are higher today.

Purchased an HSBC two year through TDDI at 5.20%

November 8, 2022
5:04 pm
Norman1
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Yes, HSBC Bank Canada seems to be really interested in one- and two-year funds. At Scotia iTRADE, they are still leading in one- and two-year GIC's:

Issuer 1 year 2 year 3 year 4 year 5 year
HSBC BANK CANADA 5.15 5.20 5.05 5.00 5.00
November 8, 2022
5:42 pm
savemoresaveoften
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Norman1 said
Yes, HSBC Bank Canada seems to be really interested in one- and two-year funds. At Scotia iTRADE, they are still leading in one- and two-year GIC's:

Issuer 1 year 2 year 3 year 4 year 5 year
HSBC BANK CANADA 5.15 5.20 5.05 5.00 5.00

  

HSBC offers 4.75% only 1 to 3 year GIC to its direct customers on its own web site.
Yet offering 30+40 bps on top via 3rd party broker which HSBC has to prob pay 10-20 bps on top. So essentially up to 5.3-5.4% funding cost vs a measly 4.75% for someone who is dealing direct from them.

Another one of those "it makes no sense type of pricing"
Another one of those "makes no sense" type of pricing.

November 8, 2022
6:41 pm
mordko
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savemoresaveoften said

HSBC offers 4.75% only 1 to 3 year GIC to its direct customers on its own web site.
Yet offering 30+40 bps on top via 3rd party broker which HSBC has to prob pay 10-20 bps on top. So essentially up to 5.3-5.4% funding cost vs a measly 4.75% for someone who is dealing direct from them.

Another one of those "it makes no sense type of pricing"
Another one of those "makes no sense" type of pricing.  

When X buys direct, they see HSBC GIC rates. When X goes to a broker, they see GIC rates from competitors too. You often see the same product priced higher if purchased at the producer venue than at a big shop with lots of choice. It often makes sense if the objective is to maximize profit. Choice lowers prices.

Wonder if one were to call HSBC, would they agree to match rates available elsewhere?

November 8, 2022
6:59 pm
Norman1
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That's exactly the case.

I've added the issuer in the #2 position for one- and two-year GIC's to the chart. HSBC Bank will get no one- and two-year deposits from Scotia iTRADE clients if they were to offer just 4.75% for those deposits:

Issuer 1 year 2 year 3 year 4 year 5 year
HSBC BANK CANADA 5.15 5.20 5.05 5.00 5.00
BANK OF NOVA SCOTIA (THE)
BANK OF NOVA SCOTIA TRUST CO.
SCOTIA MORTGAGE CORPORATION
MONTREAL TRUST COMPANY OF CANADA
NATIONAL TRUST COMPANY
5.05 5.10 5.15 5.05 5.10
November 8, 2022
7:51 pm
HermanH
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mordko said
Wonder if one were to call HSBC, would they agree to match rates available elsewhere?  

Nope. I already tried to get them to price-match a mid-6 figure GIC with competitor rates for a 5-yr GIC. HSBC would only offer 4.9%, while the others were already 5.2%. Why should anyone take a loss just for the benefit of HSBC?

November 9, 2022
7:09 pm
Norman1
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I've found that HSBC Bank is not the only one not willing to match.

The smaller lenders usually set their deposit rates already at a point that brings in deposits at a rate that matches the rate they are able to originate loans. Consequently, they are not interested in paying more to attract excess deposits. The excess deposits then need to be parked in short-term treasury bills at a loss.

It's not like selling merchandise on commission where selling more than one's target results in extra commission money.

The branch channel is also not free. The cost of the nice facilities and the staff to meet face-to-face with customers is substantial and not necessarily as low as the customary ¼%-per-GIC-year deposit broker commission.

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