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Any Chinese New Year GIC promo this year ?
January 20, 2023
11:06 am
Bill
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Late e-statements are not a big deal, just annoying and not timely in today's context, as has been noted. I review my monthly statements (historical document) in the following month and it's a first-world annoyance to have to wait 3 weeks, far later than any other fi, to do that with Wealth One activity only. Which then also raises the question of what's so unique about Wealth One's system, these things should come out automatically immediately, no human effort? So far no-one's been able to explain this uniqueness, which is odd to me.

Also Wikipedia says "In November 2016, The Globe and Mail published an article claiming that the banks website included inaccurate profiles of its key investors and that its founder previously faced allegations of mishandling client insurance claims......." I've been assured the Globe and Mail is a reputable media outlet, their 2016 article was headed "The murky beginnings of a new Canadian bank", it's available online. So I admit I'm a bit more leery than I am of fi's that don't have similar reporting about their origins, especially in the context of their continual losses.

Having said all that, my Investors Edge December statement is also not available yet.

January 20, 2023
11:47 am
Bill
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smso, I'd guess that CDIC membership is part of being approved to be a chartered bank in Canada.

January 20, 2023
12:32 pm
canadian.100
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Bill said
Also Wikipedia says "In November 2016, The Globe and Mail published an article claiming that the bank's (ie WOB) website included inaccurate profiles of its key investors and that its founder previously faced allegations of mishandling client insurance claims......." I've been assured the Globe and Mail is a reputable media outlet, their 2016 article was headed "The murky beginnings of a new Canadian bank", it's available online. So I admit I'm a bit more leery than I am of fi's that don't have similar reporting about their origins, especially in the context of their continual losses.

I read that Globe and Mail article etc. from 2016 - WOW!!

January 20, 2023
1:59 pm
Bill
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canadian.100, no kidding!

January 20, 2023
2:52 pm
savemoresaveoften
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Bill said
smso, I'd guess that CDIC membership is part of being approved to be a chartered bank in Canada.  

The question remains how to get accepted by CDIC as a member ?
Per wiki, the owners only got together $50mm asset. That does not sound like much to me at all, but enough to be a CDIC member and subsequently become a chartered bank ?

January 20, 2023
3:01 pm
RetirEd
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One thing I always pay attention to is long-term high rates at a time of falling rates or economic slowdown. I've done very well in those circumstances. When rates are rising, I look more to short-term or cashable terms, or sometimes (like this year) savings promotions while rates are on the way up.

That leaves a lot less up to chance than equity futures.
RetirEd

Alas, I have no more free cash loose to find a home until September. And my dentist wants me to invest in him.

January 20, 2023
4:29 pm
UkrainianDude
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WealthONE Bank of Canada is a Member of the Canada Deposit Insurance Corporation (CDIC). Your deposits are eligible for CDIC insurance.

Can they get kicked out of CDIC ? Or that would mean automatic bank failure and pay out of insured deposits including GIC and HISA?

January 20, 2023
8:14 pm
Norman1
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Yes, CDIC can terminate the deposit insurance of a member.

Existing deposits continued to be covered for at least two years afterwards.

It is not an automatic bank failure. But, I remember reading that uninsured deposits cannot be offered like insured ones are. So, losing CDIC coverage would mean the end of a bank's retail banking business.

January 20, 2023
8:42 pm
UkrainianDude
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Norman1 said
Yes, CDIC can terminate the deposit insurance of a member.

Existing deposits continued to be covered for at least two years afterwards.

It is not an automatic bank failure. But, I remember reading that uninsured deposits cannot be offered like insured ones are. So, losing CDIC coverage would mean the end of a bank's retail banking business.  

Okay thanks.
Am I reading this correct? If I were to open the term deposit (for instance 5 years GIC) and this bank goes belly up in one year, I should still get my money plus one year interest back, and I obviously don’t have to wait another four years tills maturity?

Effect of termination or cancellation
34 (1) If the policy of deposit insurance of a member institution is terminated or cancelled by the [Canada Deposit Insurance] Corporation, the deposits with the institution on the day the termination or cancellation takes effect, less any withdrawals from those deposits, continue to be insured under the terminated or cancelled policy of deposit insurance for a period of two years or, in the case of a term deposit with a remaining term exceeding two years, to the maturity of the term deposit.

January 20, 2023
8:56 pm
Norman1
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UkrainianDude said

Okay thanks.
Am I reading this correct? If I were to open the term deposit (for instance 5 years GIC) and this bank goes belly up in one year, I should still get my money plus one year interest back, and I obviously don’t have to wait another four years tills maturity?

That's up to CDIC and OSFI to decide.

Regulators can wind the bank up shortly or run the bank until its assets are sold with assuming the deposit liabilities being part of the purchase price.

So, one could be stuck for another four years until the term deposit matures.

January 20, 2023
10:17 pm
Loonie
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So far, the only product I have from WealthOne is a five year GIC @ 2.88 from a previous promo. I wouldn't be at all unhappy if CDIC paid me off!

It was a best-available choice that year from point of view of GIC ladder, and I only put in a limited amount that year due to low rates, so no big deal, but I'd be just as happy to be rid of it!

In answer to previous issue raised, yes, I was referring to personal monthly statements. I note though that some FIs only provide statements every 3 months. Meridian is one.

I'd still like to know how long it is supposed to take for a bank (or, better, this particular bank) to make a profit. If we don't know that, then it seems to me our hypotheses about failure are moot.

January 21, 2023
4:57 am
canadian.100
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Loonie said
I'd still like to know how long it is supposed to take for a bank (or, better, this particular bank) to make a profit. If we don't know that, then it seems to me our hypotheses about failure are moot.  

Yes - it would be nice for us know how long the "interests" (entrepreneurs, investors, creditors) who financed/are financing this upstart have committed to keeping it going - we are not a party to that information - and they (entrepreneurs, investors, creditors) will not be broadcasting that information.
Loonie -There is no "standard" timeframe for any upstart business to become profitable - it depends entirely on how long the entrepreneurs, investors, creditors want and agree to keep it going and are able to keep covering the losses with more funding/debt. Entrepreneurs/investors do cut their losses at a certain point - that point is ultimately decided by them or perhaps by the regulatory agencies who are overseeing them.
I think all we are saying is that this bank is at a higher risk of going under - it may or may not - that decision is in the hands of others. Some of us would prefer to deposit with more stable and profitable FIs and avoid any delay in getting our funds back if CDIC ultimately needs to step in.

January 21, 2023
5:23 am
UkrainianDude
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Norman1 said

UkrainianDude said

Okay thanks.
Am I reading this correct? If I were to open the term deposit (for instance 5 years GIC) and this bank goes belly up in one year, I should still get my money plus one year interest back, and I obviously don’t have to wait another four years tills maturity?

That's up to CDIC and OSFI to decide.

Regulators can wind the bank up shortly or run the bank until its assets are sold with assuming the deposit liabilities being part of the purchase price.

So, one could be stuck for another four years until the term deposit matures.  

I am stuck for another four years will get interest paid for this time ?
Never thought there’s so much risk involved with Canadian banks even if it is a member of CDIC.

January 21, 2023
6:17 am
savemoresaveoften
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UkrainianDude said

I am stuck for another four years will get interest paid for this time ?
Never thought there’s so much risk involved with Canadian banks even if it is a member of CDIC.  

While deposits will be accessible in a timely manner and cover by CDIC, any GIC etc does not have to be wind down and pay out immediately. I imagine CDIC and OSFI will try to find another FI to assume the GICs, or investors may risk losing 4 years of interest (CDIC only covers principal and interest up to date of bankruptcy and not the full term).

January 21, 2023
8:39 am
Norman1
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UkrainianDude said

I am stuck for another four years will get interest paid for this time ?
Never thought there’s so much risk involved with Canadian banks even if it is a member of CDIC.

Yes, if the regulators decide to keep the bank running, then the GIC's will continue earning and paying interest until maturity.

When Central Guaranty Trust failed in the 1990's, CDIC made it worth TD Bank's while to buy parts of the loan book that were good, the branches, and the trust business. TD Bank assumed the deposit liabilities as part of the purchase price. None of the Central Guaranty Trust GIC's were paid out early.

January 21, 2023
9:17 am
UkrainianDude
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Norman1 said

UkrainianDude said

I am stuck for another four years will get interest paid for this time ?
Never thought there’s so much risk involved with Canadian banks even if it is a member of CDIC.

Yes, if the regulators decide to keep the bank running, then the GIC's will continue earning and paying interest until maturity.

When Central Guaranty Trust failed in the 1990's, CDIC made it worth TD Bank's while to buy parts of the loan book that were good, the branches, and the trust business. TD Bank assumed the deposit liabilities as part of the purchase price. None of the Central Guaranty Trust GIC's were paid out early.  

Okay thanks. This would be a good scenario.
My concern is, if let’s say I open five years GIC with Wealth one bank in 2023. In 2024 CDIC will recall its insurance but let the bank run. Nevertheless wealth one declares bankruptcy in 2025. Since CDIC coverage only good for two years since insurance. Will this five year GIC be gone with 100% loss of principal and interest?

January 21, 2023
9:44 am
Alexandra
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You probably already know this, but just in case of interest, one can find a complete list of CDIC insured FI's that have failed in Canada since 1967. See "CDIC History of Failures". Except for the Bank of British Columbia, the rest on the list were all Trust, Mortgage and Loan Companies.

I had a mortgage many years ago with Crown Trust and they are on that list.

Loonie, don't feel badly about your GIC at Wealth One, I have a 5yr GIC with them @1.9% interest. One of the only ones that I have interest compounded instead of paid out annually!!sf-embarassed

January 21, 2023
10:36 am
savemoresaveoften
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UkrainianDude said

Okay thanks. This would be a good scenario.
My concern is, if let’s say I open five years GIC with Wealth one bank in 2023. In 2024 CDIC will recall its insurance but let the bank run. Nevertheless wealth one declares bankruptcy in 2025. Since CDIC coverage only good for two years since insurance. Will this five year GIC be gone with 100% loss of principal and interest?  

This will be an interesting and rare scenario. Why don’t you ask CDIC and report back ?

January 21, 2023
11:57 am
UkrainianDude
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savemoresaveoften said
This will be an interesting and rare scenario. Why don’t you ask CDIC and report back ?  

Oh come on this is Canada, and I lived long enough already here. Good luck trying to get any meaningful response from federal or provincial regulators. sf-cool

January 21, 2023
12:06 pm
Bill
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In fact, I've had occasion to call CDIC a couple of times, pretty knowledgeable is my experience, they'll probably have your answer.
https://www.cdic.ca/contact-us/

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