What Happens in a Failure

Reimbursement of insured deposits

In certain cases, a failed bank is closed, all contracts are terminated and its critical financial services are no longer available, including access to accounts.

So that insured depositors have their money as quickly as possible, CDIC would automatically launch its reimbursement process. This means that:

  • Insured depositors do not have to file a claim.
  • CDIC would reimburse insured deposits up to $100,000 per insurance category.
  • Payments to the depositor would be completed via cheque.

The reimbursement process varies according to the relationship the depositor has with the failed bank.

For Depositors

For Brokers and other Financial Professionals

For Professional Trustees

For General Trustees

Payments of insured deposits

CDIC will automatically reimburse your deposits, to a maximum of $100,000, per insured category. We expect to start mailing cheques for the Deposits held in one name and Deposits held in more than one name (i.e. joint deposits) categories in the days following the closure of the failed member.

We use the information in the failed member’s records to issue reimbursements.

The funds used to reimburse depositors come from premiums paid by CDIC member institutions. We do not use taxpayer dollars.

Deposits held in one name and Deposits held in more than one name (i.e. joint deposits) are reimbursed separately by cheque. CDIC will issue a letter, statement and cheque for each category. No action is required from you.

If you held any insured deposits in a GIC, interest owing is calculated and added to your deposit. This calculation is based on the length of your deposit and the date of the failure. You can find interest amounts on your final statement.

Registered deposits

We know it is important for insured deposits in registered accounts, such as Tax-Free Savings Accounts (TFSAs), Registered Retirement Savings Plans (RRSPs), Registered Education Savings Plans (RESPs), Registered Disability Savings Plans (RDSPs), First Home Savings Accounts (FHSAs) and Registered Retirement Income Funds (RRIFs) to remain tax-sheltered. CDIC will work with the Canada Revenue Agency and a court-appointed liquidator to help you transfer your insured registered deposits to a registered plan at another financial institution of your choosing. Once appointed, the liquidator will contact you separately for next steps on the transfer process.

You will not receive a direct payment from CDIC for any registered account. CDIC will hold these insured deposits while working with the court-appointed liquidator to ensure they are transferred to another financial institution, as soon as possible, without any tax implications. CDIC will mail a separate letter and statement for each deposit insurance category holding registered deposits.

Amounts over the limit and uninsured financial products

CDIC reimburses insured deposits to a maximum of $100,000, per insured category. If you hold deposits over the coverage limit of $100,000, you will receive a payment of $100,000 from CDIC and will need to contact the court-appointed liquidator to file a claim for the amount above the coverage limit.

Mutual funds, stocks, bonds, and ETFs are not protected by CDIC. These financial products may be reimbursed by making a claim with the liquidator, once appointed, or may be protected under different regimes.

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