Financial Community and Trustees

Changes to deposit insurance affecting Nominee Brokers

Effective April 30, 2022 there will be a new framework for how deposit insurance is provided for deposits held “in trust” at CDIC member institutions (MIs) including nominee brokered deposits.

This new framework sets out the requirements that nominee brokers must meet to the ensure deposits they hold for their clients (i.e. the beneficiaries) are protected. For instance, brokers will be required to:

  • transmit to the MI at the time a deposit is made or is changed a unique client identifier (UCI) for each client beneficiary to the deposit;
  • use this UCI for all deposits made for that client at an MI;
  • disclose to the MI the beneficial interest for each beneficiary under the deposit;
  • have the capacity to provide CDIC with the UCI & related client name and address within 3 business-days of CDIC’s request; and
  • annually attest to having this capacity to CDIC.

It is important to note that:

  • These requirements are not discretionary; they must be applied to ensure deposits are protected.
  • New rules will require important system and process changes across the brokered deposit industry
  • Implementation activities will require consistent application by all involved in the brokered deposit process.

In an effort to develop industry-wide solutions for implementing the new deposit insurance framework as it pertains to nominee brokered deposits, CDIC facilitated the creation of the Brokered Deposit Advisory Group (BDAG). You can find industry developments and best practices for nominee brokers by referring to the Brokered Deposit Advisory Group (BDAG) section of this website.

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