Jun 23, 2017
Home Capital's high GIC rates a play to restore confidence: RateHub
BNN Bloomberg
Home Capital’s Oaken Financial is offering substantially higher rates on a five-year registered GIC, according to data released on Thursday by mortgage rate website ratehub.ca.
The company’s 3.25 per cent return rate could net investors an extra $300 on a $5,000 investment when compared to the second-highest offered rate.
5-year registered GIC rates
INSTITUTION | RATE | RETURN ON $5,000 |
---|---|---|
Oaken Financial | 3.25 % | $813 |
PC Financial | 2.00 % | $500 |
Tangerine | 2.00 % | $500 |
Manulife Financial | 1.90 % | $475 |
RBC Royal Bank | 1.60 % | $400 |
TD Bank | 1.50 % | $375 |
National Bank | 1.50 % | $375 |
Bank of Montreal | 1.50 % | $375 |
CIBC | 1.25 % | $313 |
Scotiabank | 1.25 % | $313 |
The data – released the same day Home Capital (HCG.TO) announced a $2-billion loan from Warren Buffett’s Berkshire Hathaway (BRKa.N) – highlights Home Capital’s efforts to rebuild investors’ trust.
“This is an attempt, along with the investment from Buffett, to give Canadians confidence that they’re depositing money with a safe and reputable company,” RateHub’s co-founder James Laird told BNN.ca.
“It’s business as usual at the larger banks and the smaller banks. They don’t have a crisis of confidence with their banks and with their brands, so there’s no need for them to price well above market, whereas Home Capital… they’ve been in a very precarious position for the last 30 days or so which means that Canadians are certainly pausing before they deposit money there.”