A high-interest savings account is important if you want to earn a reasonable return on the money sitting in your savings account.
The rates available on traditional savings accounts are so bad that if you are not using an online bank, you are likely losing spending power for each day that passes by.
LBC Digital offers one of the highest savings rates in Canada. This review covers what you need to know about the bank.
Who is Laurentian Bank?
Laurentian Bank of Canada was founded in 1846 in Montreal, Quebec, and was initially established as the Montreal City and District Savings Bank.
Today, Laurentian Bank Financial Group (LBCFG) has corporate offices in Montreal and Toronto and consists of several subsidiaries including Laurentian Bank of Canada, B2B Bank, Laurentian Bank Securities Inc., LBC Capital Inc., and several others.
LBCFG has more than 3,600 employees and $44 billion in assets.
Laurentian Bank of Canada is a Schedule 1 bank and its stock trades as “LB” on the Toronto Stock Exchange.
LBC Digital is the online banking arm of Laurentian Bank. This digital bank offers a:
- High-interest savings accounts (HISA)
- Guaranteed Investment Certificates (GIC)
- No-Fee Chequing Account
LBC Digital High Interest Savings Account
This account offers a tiered interest rate of up to 2.25%. There is no monthly account fee and no minimum balance is required.
The interest rate tier works as follows:
- $1 to $500,000: 2.25%
- $500,000.01 +: 1.00%
The interest rate is calculated daily on your closing balance and paid out monthly.
Laurentian Bank is a member of Canada Deposit Insurance Corporation (CDIC) which means your deposits at the bank are insured up to $100,000 per category.
LBC Digital is an online-only bank.
To deposit money into an LBC Digital HISA account, you will need to link your LBC account to a bank account at your other financial institution.
If you have funds in your LBC Digital Chequing account, you can easily transfer it to your savings.
The following fees may apply:
- Non-Sufficient Funds (NSF): $50
- Account closure within 90 days of opening: $25
- Returned items: $5
- Dormant account fees (2-9 years): $25 per year
- Dormant account fee (10 years): $40
LBC Digital Chequing Account
This no-monthly-fee account offers free Interac e-Transfers and access to more than 3,500 free ATMs via THE EXCHANGE Network.
The LBC Digital Chequing Account is not currently paying interest on chequing account balances.
To deposit funds into the account, you can link another bank account or deposit a cheque or cash at an ATM.
Some of the fees that apply to this account include:
- Bank draft: $10
- NSF: $50
- Overdrawn interest rate: 21% per annum
- Dormant account fees: similar to the savings account
- Interac ATM transaction: $1.50
1-5 year non-registered and non-redeemable GICs are available with a minimum deposit of $100.
LBC GIC rates as of April 23, 2020, are:
- 1-year term: 1.70%
- 2-year term: 1.80%
- 3-year term: 1.85%
- 4-year term: 1.96%
- 5-year term: 2.00%
The application process for LBC Digital accounts is all completed online. You can reach their customer service at 1-866-249-1489 or 1-416-216-5384 from Monday to Friday (8am – 10pm ET) or weekends from 9am – 5pm ET.
Related: Best GIC Rates in Canada
Is Laurentian Bank Bank (LBC Digital) Safe?
Laurentian Bank is a CDIC member institution and eligible deposits at the bank are insured up to $100,000 per insured category.
Deposits covered by CDIC guarantee include savings, chequing, and GICs with a maturity of 5 years or less.
As per their website, LBC Digital “adheres to the principles adopted by the Canadian Bankers Association with respect to the protection of personal information.”
Pros and Cons of LBC Digital Savings and Chequing Accounts
- High-interest savings rates
- Access to 3,500 free ATMs in Canada
- Free Interac e-TRansfers (chequing account only)
- No monthly account maintenance fee
- The account opening process can be a real pain
- Mobile cheque deposits and Interac e-Transfers are not available for the savings account
- The online platform is not very user-friendly. It looks outdated and some users report that it suffers downtime on a regular basis.
LBC Digital vs. Other Online Banks
LBC Digital compares favourably with other digital banks offering good HISA rates in Canada.
EQ Bank offers a 2% rate on their hybrid Savings Plus Account. This account offers free unlimited transactions (including e-Transfers), mobile cheque deposits, cheap international money transfers, and access to one of the best mobile banking apps I have come across.
Unlike LBC Digital, EQ Bank does not offer a traditional chequing account. You can read my EQ Bank review for more details.
Tangerine has a 2.80% promotional interest rate for 5 months, however, it falls to a dismal 0.25% afterward. They also offer a free chequing account, investments in registered and non-registered accounts, credit cards, loans, and business accounts.
Those who are looking for an online bank that provides all the important everyday accounts would find Tangerine attractive. You can get more details in this Tangerine review.
Motive Financial is another virtual bank with one of the best HISA rates. In addition to savings, they also offer a chequing account and GICs. This Motive Financial review covers all the basics.