Changes to deposit insurance affecting Nominee Brokers
OTTAWA – February 6, 2020 – Effective April 30, 2021 there will be a new framework for how deposit insurance is provided for deposits held “in trust” at Canada Deposit Insurance Corporation (CDIC) member institutions (MIs) including those placed through nominee brokers. This new framework sets out the requirements that nominee brokers must meet to ensure the deposits they hold for their clients (i.e. the beneficiaries) are protected.
To develop solutions for implementing the new framework, CDIC has partnered with industry in a Brokered Deposit Advisory Group (BDAG). The advisory group supports discussion among stakeholders affected by these rules and promotes the development of sound industry best practices that help ensure a strong and coordinated implementation of the deposit insurance rules.
Further details about the new requirements for nominee brokered deposits and advisory group are available in the Financial Community section of the CDIC website.
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CDIC is a federal Crown corporation established in 1967 to protect the savings of Canadians, and we contribute to financial stability by safeguarding over $800 billion in deposits at more than 80 member institutions. As resolution authority, we are responsible for handling the failure of any of our members, from the smallest to the largest. Our members include banks, federally regulated credit unions as well as loan and trust companies and associations governed by the Cooperative Credit Associations Act that take deposits. We are funded by premiums paid by member institutions and do not receive public funds to operate. We have resolved 43 member failures affecting some two million Canadians. No one has lost a dollar of deposits under CDIC protection.
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For further information:
Director, Communications and Public Affairs