Q&A: Manitoba rates

Question: Why are Manitoba credit union GIC rates much better than Ontario and are they safe – are we protected in Ontario by the Deposit Guarantee Corporation of Manitoba? Also is there someplace in Ontario where we can get the same rates as Manitoba? – David D., Toronto

Gordon Pape answers: It’s true that several Manitoba-based credit unions offer GIC rates that are among the highest in Canada, sometimes through a separate division such as Outlook Financial, Achieva Financial, MAXA Financial, and AcceleRate Financial. There is no obvious reason for this beyond the fact they have decided to be highly competitive in attracting new business, not just from within Manitoba but across the country.

Manitoba’s deposit insurance system protects all depositors, not just residents of the province. But it is worth noting that this is not a government agency nor is the coverage backed by any provincial government guarantee.

It is possible to find a matching rate in Ontario, in fact a slightly better one. According to Globeinvestor.com, ICICI Bank Canada, which is a subsidiary of one of India’s largest banks, is offering 3.3% on five-year non-redeemable GICs. This compares to 3.25% from the highest-paying Manitoba credit unions.

ICICI has seven branches in the Greater Toronto area as well as one each in Calgary and Surrey B.C. See their website for details at www.icicibank.ca. The site does not post current rates for non-redeemable GICs so call the bank to confirm the Globeinvestor rate is correct before you make a trip to a branch.

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