Canada's Scotiabank has increased its distribution capabilities for its Market Powered guaranteed investment certificates (GICs) this week, opening its second new branch in Edmonton this month.
The branch will offer wealth management and investment management services, including issuing its Market Powered GICs, as well as other traditional banking services.
The bank's now has a network of 24 bricks and mortar branches in Edmonton, with plans for an additional branch in the spring and another six branches in the greater Alberta region where the bank is expanding.
So far this year, Scotiabank has already issued, or plans to issue, 50 tranches of GICs, nearly three-quarters (72%) of which are linked to the performance of the S&P500/TSX60 index, according to SRP data. The index includes 60 of the largest corporations by market capitalisation that trade on the Toronto Securities Exchange.
Scotiabank typically issues GICs with three-year and five-year tenors. Its products' brand name, Market Powered GICs, is marketed as allowing for upside growth potential amid interest rates hovering near 40-year lows.
Data shows that 612 GICs have been registered for sale across Canada in 2009, with Bank of Montreal having the greatest market share, issuing nearly one-third (222) of the total. Scotiabank's GICs account for slightly more than eight percent of the overall Canadian GIC market.
GICs have been the favourite wrapper for structured products in Canada this year, outselling traditional structured securities by more than two to one. GICs have sold C$5.75bn ($5.41bn), while structured securities have sold C$2.84bn ($2.67bn).