If you’re a rate-chaser, it’s a done deal that you’ll have to open an account at an unfamiliar bank to get top returns on guaranteed investment certificates and savings.
Let’s not make too big a deal of this. I have many accounts at many banks and credit unions and the very few problems I’ve had relate to technology issues, not stability. But I know from readers contacting me that there’s a segment of GIC buyers who shy away from unfamiliar banks.
There’s usually a cost to this in the form of lower rates. But now and then, the competitiveness of GIC issuers hits a peak and top rates become available from a wider selection of issuers. That’s the story in GIC-land this week.
Tangerine, the well-known online bank owned by Bank of Nova Scotia, offered a one-year GIC at 5 per cent this week. Tangerine is big on offering a low rate on its savings account and then tossing out rate bonuses here and there. But this one-year GIC offer is a straight-up offer – clean and simple.
Some people may still be unfamiliar with EQ Bank, but this onetime upstart has turned itself into a substantial alternative to the big banks for everyday saving and banking. EQ’s savings rate isn’t as competitive as it used to be, but the bank was competing aggressively for GIC money this week with offers of 5.2 per cent for one year, 5.15 per cent for two years and 5 per cent for three years.
Another GIC issuer that should be familiar is Oaken Financial, which is part of Home Capital Group. Oaken this week offered 5.1 per cent for one year and 4.95 per cent for two years.
The big banks were not in the 5-per-cent zone this week and haven’t been for months. But several of them offered “special” GIC rates that are worth a look for people uncomfortable with straying beyond a Big Six bank.
Some sample offers: Bank of Montreal had a 4.5 per cent 18-month GIC on offer this week, Bank of Nova Scotia had 4.65 per cent for two years and 4.8 per cent for 30 months, Canadian Imperial Bank of Commerce and Royal Bank of Canada had 4.45 per cent for one year and TD Canada Trust had 4.5 per cent for 14 months.