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National Bank Financial Accounts
At National Bank Financial, you can open different kinds of accounts, depending on your personal financial needs.
We offer a number of different types of accounts, all of which feature five distinct advantages:
- They allow you to keep your securities with us at no cost to you. All your investments will appear on a regular statement, which greatly facilitates overall investment management;
- All interest and dividends earned by your investments, plus the capital at maturity, are automatically and immediately credited to your account;
- All your year-end tax receipts are also consolidated. Instead of receiving a separate slip from each issuer, you receive one set of slips from us, which makes life much easier when it’s time to do your tax return;
- All of our accounts pay a competitive rate of interest on cash balances;
- Last, but certainly not least, all our accounts are covered by the Canadian Investor Protection Fund (CIPF).
Although National Bank Financial offers many different types of accounts, some of which are designed for very specific investment strategies, most of our clients choose one of the four accounts listed below.
Regular (Cash) Account
This is an account in which you deposit money used to make your investment transactions. When you buy or sell a security, the appropriate amount is debited from or credited to the account on the settlement date (usually three business days following the transaction). Note that any cash balance you leave in the account will earn competitive interest. Cash accounts are available in Canadian or U.S. funds.
Margin Account (Account with Borrowing Privileges)
A margin account is the same as a cash account, except that it includes a line of credit, determined by the value of your investments. In other words, you can borrow money – to finance additional investments or for any other purpose – based on securities that you already own, which are then used as collateral. Margin accounts are available in Canadian or U.S. funds.
Short Account
This type of account is for experienced investors who engage in short selling. This account is available in Canadian and U.S. dollars.
RSPs, RIFs, and Other Tax-deferred Accounts
These accounts are designed to hold investments you want to keep in a tax-deferred plan, such as a retirement savings plan (RSP), retirement income fund (RIF) or education savings plan (ESP). In this type of account, dividends, interest and capital gains remain sheltered from tax until withdrawn.
How Are Your Funds Protected?
We protect the investments entrusted to us in several ways.
National Bank Financial abides by the strict rules of conduct set out by the various organizations governing investment dealers in Canada. Protecting your assets is our top priority and we assure this protection in three additional ways: through asset segregation, by means of an industry-funded protection fund and through supplementary private insurance.
Asset Segregation
The term "segregation" refers to the physical location where we safeguard securities on behalf of our clients. Fully paid securities are literally kept separate from all other securities held by the firm. They cannot be accessed in any way by anyone inside or outside National Bank Financial without your express consent. In the very unlikely event that National Bank Financial were to become insolvent, its creditors would have no legal claim whatever to your fully paid securities. Sophisticated accounting methods and regular audits by independent firms ensure compliance with this fundamental rule.
Canadian Investor Protection Fund
Because we are a member of the Investment Dealers Association of Canada, all funds invested with us are covered by the Canadian Investor Protection Fund (CIPF), which protects the public in case of the insolvency or bankruptcy of a member firm. The CIPF guarantees your general accounts up to $1 million. Separate coverage of $1 million also applies to your combined registered retirement accounts (RSP, RIF, LIRA, LIF). Certain other types of accounts (ESP, trust, etc.) also benefit from their own separate $1 million coverage. For more details on the subject, please consult the Canadian Investor Protection Fund brochure, available from any National Bank Financial Investment Advisor.
Of course, fixed-income securities, such as bonds, stripped bonds and Treasury bills, are fully and unconditionally guaranteed when held to maturity (both in terms of their rate of return and value at maturity) if they are issued by a government or government agency. Remember, however, that the value of all other securities, such as stocks or mutual funds, is subject to market fluctuations and therefore not guaranteed.
Note also that National Bank Financial and the National Bank of Canada are separate corporate entities, which means that securities sold by National Bank Financial are not guaranteed by the National Bank, unless they are issued by the National Bank itself.
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