More Money Podcast - 264 Is Your Money Safe at the Bank? - Peter Routledge, President and CEO of CDIC

Episode Date: February 4, 2021

Is your money safe at the bank? It’s a question I get asked all the time. Same with is it safe to use an online bank. And that’s thanks to the Canada Deposit Insurance Corporation (CDIC). I’ve personally partnered with CDIC for years because I believe it’s so important to spread awareness about how our deposits are protected at the bank. In other words, if your bank goes bankrupt, you won’t lose any of your money at that bank. And just so you know, there hasn’t been a bank failure in Canada for 25 years. And even when there was a bank failure in Canada, as long as CDIC has been around, not a single Canadian has lost a dime! To share more about this, so you too can spread the word and feel confident that your money is safe at the bank, I’ve got Peter Routledge, President & CEO of CDIC on the show to explain what CDIC is, how it works, and what you should know. For full episode show notes visit https://jessicamoorhouse.com/264 Learn more about your ad choices. Visit megaphone.fm/adchoices

Hello, hello, hello, and welcome back to the Momany Podcast. This is episode 264, and this is your bonus episode. Don't you love when I drop a special episode? Two episodes in one week? I mean, fun, right? Anyways, my name's Jessica Morehouse. If you're new to the show, welcome, welcome, welcome. Hope you like to learn things about money because that is what we talk about on the show. And for this bonus episode, we are specifically talking about how your money is safe at the bank because even though it is 2021, it is actually kind of wild how many Canadians do not know that their money is safe at the bank. It's safe, guys. You're going to be just fine. I know this because I recently did an Ask Me Anything on Instagram. I do one about once a week.

I got so many questions with this one recently asking about, hey, if I don't bank at one of the big banks, if I use one of these like a credit union or one of the online banks, is it safe? Will I lose my money? What if they go bankrupt? That is always the question I keep on getting. I've been getting that question for the past 10 years. Guys, your money is safe at the bank. And you know why? It's because of CDIC, the Canada Deposit Insurance Corporation. I mean, it's just kind of crazy to me that so many people don't know. And that's what we're going to be talking about in this episode. So you know, and then you can tell others so they'll know. And then more and more Canadians will know that it is way safer to have your money at the bank than

in a jar or under your mattress or in your walls. Please do not do any of those things. That is not a good idea to put your cash there. So I have a very special guest for this episode of the show. I have the president and CEO of the Canada Deposit Insurance Corporation, CDIC, Peter Rutledge on the show. So we talk about, what the heck is CDIC? Who is protected? What banks and credit unions, how are they protected differently? Because they do actually have different protections. And also, when was the last time a bank went bankrupt? What happens if a bank goes bankrupt? How do you actually get your money if your bank goes bankrupt? All these important questions that I know you have, we answer in this episode. So just a little bit more about Peter. So Peter, or if we want to get,

you know, official, Mr. Rutledge has an extensive experience in Canada's financial sector. Prior to joining CDIC, he was a senior advisor at the Department of Finance, where he provided advice on a range of policy issues, including financial stability, housing finance, and competition in Canadian financial services. He's held a variety of leadership roles in the financial services industry, both in Canada and abroad. And he served as managing director of research at National Bank Financial, where he led a team responsible for producing equity, fixed income, and derivatives research on Canadian financial institutions. And prior to that, he led the Canadian Financial Institutions Group at Moody's

Canada with responsibilities for covering issuers in the banking, life insurance, and personal and commercial insurance and reinsurance industries in Canada and the US. Not only that, he's got an MBA and he also has a bachelor's from my old university, Simon Fraser University. How cool is that? Look at this. I mean, we studied very different things, but hey, we went to the same university, so that's pretty cool. So long story short,

he knows what he's talking about. And so you're going to learn a lot from this episode. So enjoy, enjoy this episode. Welcome to the Mo Money Podcast, Peter. I'm so happy to have you on. Thanks, Jessica. Great to be here. Yes. I subscribe to your podcast on Spotify. Oh, thank you so much. So I'm so excited to have you here to talk about CDIC and just spread some more awareness because people need to know more about it. But before we get going, can you share a little bit about yourself?

You're the CEO of CDIC. What does that role kind of entail? What do you do? Yeah. So the role of CEO of CDIC is basically to lead the corporation day to day. So we have a group of about 175. And then I report formally to our board of directors, which is composed of 11 folks. Five are from the public service like me. So it'd be the superintendent of financial institutions, the governor of the Bank of Canada, the deputy minister of finance, and the commissioner of the FCAC. And then we have six private sector directors as well.

And they govern the corporation, make sure that whatever we do in management is in keeping with the government's objectives. And the board, in turn, reports to Parliament through the Minister of Finance. The Minister of Finance is sort of the person in the government on point for CWC. Okay, awesome. Good to know. I feel like a lot of people have no idea how the organization kind of is structured. So that's interesting to find out. It's important to note just for folks, we're a technical organization. We're not in the political space. Our motto is fearless advice and faithful execution. So

we follow the sovereign will of the party. Yeah, no, that is definitely important. So I've personally worked with CDIC over the years doing campaigns, trying to spread awareness about how there are protections in place for us Canadians when we bank with a CDIC member. But I'm honestly still shocked personally about how many people in Canada don't actually know that their deposits are secure at the bank. I mean, I recently did an Instagram Ask Me Anything and I had lots of questions come in that were basically about, should I bank here or there? Which one's safer? Thinking that if one of these banks is going to go bankrupt, I'm going to lose all my money. And I'm like, it is 2021. How do we not know about this? So why do you think there is still this kind of knowledge gap? Why is there still kind of this lack of awareness with some people and still so much, I think, misinformation out there?

There's still a lot of people that believe it's safer to put your money under your mattress, don't trust the banks. Why do you think that is? Well, it's a good question. We wrestle with it all the time. But I think one of the core reasons is that we've had a bank failure. It's 25 years. It's a quarter century. It's a full generation. If we go down south to our neighbors in the United States, and they've had roughly 500 bank failures since 2008-9, their awareness is much higher, probably north of 80%. So there's the reason, number one, we have a fairly resilient potential system without a lot of failures. And so people tend to remember a deposit and insurer when the deposit and insurer comes through for them. Simply put, the ISD hasn't had to come through for anyone for about 25 years.

You know, events stick with your mind. I'm sure people are a lot more aware of health risk now than they were a year and a half ago. So that's part of the reason. I think the other part of the reason is we need to continually do a better job at reaching folks who should know about our product and know about the quality of our product so that they know that their money is with a federal financial institution. They see the little purple lock on the branch door on the website. They're protected. CDIC, you already have insurance when you make the deposit.

It's going to be there as long as you have the deposit at the bank there. And God forbid anything happens to your financial institution, we're going to give you access to that portion that's insured as quickly as we can. Our goal is within seven days, depending on the data and some of the details around the deposit, like is it registered or not, stuff like that. You'll get your access to your deposits as quickly as possible in that crisis. I think it does actually make a lot of sense why I hear a lot of people like, oh, I had no idea, but maybe there's actually more awareness that there is protections in the U.S. We get a lot of information about the U.S., and so I think a lot of that fear of what if there's a bank failure, and you just said we haven't had one in 25 years, but the U.S. has had a lot in the

past 10 years. I think we're afraid of, like, we're kind of getting confused about what happens in Canada versus the U.S. And I feel like a lot of that fear stems from what if what's happening in the U.S. happens here, but the fact that nothing's happened here should actually make us feel more secure. Yeah. If you peel the onion back on awareness, there's some interesting findings. So we have 60% un-aided awareness generally. So ask the average Canadian, 10 Canadians, if they know about deposit protection, six will say yeah. But if you go into the numbers where we're strong, it tends to be folks who have savings or older. So our awareness levels for Canadians who are in their 50s and older are much higher, like the 65%, 70%. In that demographic, and then folks that are younger, we're sort of in the 45% range,

I think, 40%, 45%. So we can do a lot better uh where with targets of the population segments of the population we may not be familiar with our product but the good news is that as you save a bit of money and as you get a little bit older and you're thinking about your retirement maybe a little bit more than you did when we were younger. People do seek out that information, and when they do, they learn about us. We can do a better job at opening that pathway up to folks in different walks of life and folks who are younger. And we're trying to, through social media, we've had some really positive results over

the last 18 months, But the battle continues. You know, to give you a sense, we spend, we budgeted last year, $6 million to spend on public awareness. Because of the pandemic, we scaled up. And this year, we'll probably go a little north of that, close to $7 million. We had a 2% to 3% increase in awareness from like 58% to 60%, 60 and a half percent. Yeah, I bet because of the pandemic, a lot more people were actually trying to find this

information because a lot of people were just thinking of the worst case scenario of, you know, I think also lots of people, you know, like myself being a millennial, being very familiar with the last crash and everything that happened and that fear, that same fear kind of sparked in the spring. And I think a lot of people were probably trying to find, hey, what happens actually if everything collapses? So we had this perfect, I mean, unfortunately it happened as a result of a health crisis, but there was sort of this great opportunity for people to turn their attention to the safety of their deposits.

And then we sort of met that moment by spending a bit more and getting our message out at a greater frequency. And we found other sort of innovations. We've run sort of games with our members, some of our members on their websites, you know, play this game, maybe enter, it'll get you, if you successfully play the game, you entered into a raffle for some money. And we found that that exercise really, you know, and part of playing the game is learning what CDIC does. And that, that tends to stick, the knowledge tends to stick when you do that. And so we're constantly trying to figure out how we can use social media to spread our message and maybe help it stick.

And, you know, the big banks, I guess if you were to look at awareness, Canada's six largest banks, you'd probably see awareness levels close to 90%. They're spending $50 to $60 million annually on their awareness. So we're a public institution and try and use our funds sensibly. So get 60% awareness out of $6, $7 million a year is pretty good value for money as you go from 60 to 90 the cost of getting up and sustaining higher levels of awareness rises exponentially so we can get 60 awareness you know with six seven million dollars a year if we if we wanted to get up towards 90 we'd have to be spent year every year. And does that get us incrementally more

safety in the financial system? And the answer is no, not really. You sort of reach an optimum point of protection when you get about 60% awareness. When getting to that level of awareness lowers the propensity for a bank run to occur to quite, quite minimal levels. And so spending incremental dollars to lower it even further, it's just not good value for money in our church. We set 60% as our target as the optimal cost-benefit trade-off. Yeah, I wanted to actually talk a little bit about, because we talked a lot about awareness,

and I think people may be wondering why is it so important? And you kind of mentioned it basically has a lot to do with people having just that sense of security in the whole kind of financial system in Canada. Do you want to kind of talk about that and mention like why it is so important to kind of get the message out that your deposits are covered at the bank because we don't want people, like you said, bank run. I think most people have no idea what that is because we haven't experienced one in a very long time. For folks to get a sense of that, they should next Christmas watch one of my favorite movies of all time, It's a Wonderful Life, Jim Stewart. Yes, I love that one. Yes yes best dramatization of a bank run i've ever seen uh and and you recall right there's that scene where there's some uncertainty in the local community there bedford falls and people show up

at the building alone the bedford falls building alone loan they say no one dollar deposits up jimmy stewart comes in with uh twenty five hundred dollars in cash he says look look hey everyone just hang in there bob you're all your funds they're they're over there in that mortgage for jane jane your money is over there in that mortgage for fred and uh if we all just hang together and leave our money in uh and only take out what you need, everything will be okay. That's our job. That dramatizes the bank run, which is kind of a social phenomenon where everyone talks to one another and get nervous and they show up at the bank. And so what CDIC was created to do is to say to everyone to be Jimmy Stewart. Everyone, your money's safe. Just leave it there. Don't put it in your mattress. You're still going to earn your interest. Even if something goes wrong with

all the loans we've made, CDIC is there to make sure you get your deposits back quickly. Now, I remember watching that movie and that was the first time I realized, oh, the bank doesn't just have your money sitting there. I mean, again, the first time I watched it was a long time ago. So I was like a kid. But I always just assumed, probably from cartoons, that the bank had your money in a safe somewhere, and that is just not how the system works. And so if we all run to the bank and we all ask for our money, it's not going to work out. And so CDIC is basically a first responder, you know, to a disaster. And so if, God forbid, a deposit-taking institution in the federal system doesn't have enough capital, we're there quickly to give depositors their money back so that they don't lose anything.

And then we work out the resolution of that institution, and we accept the losses that the depositors would otherwise have to take. So let's kind of dive in a little bit to what, because we've talked a lot about, you know, your deposits are protected, but I think there's obviously some caveats. It doesn't mean everything you have at the bank is protected necessarily. So let's do a little CDIC 101. How does CDIC protect Canadians' deposits at the bank? What does it actually ensure? And then we'll talk about what it does not cover. Yeah. So if you deposit, if you make a deposit with a federal institution in the CDIC membership, and you will know that right away by the little purple lock on the door or on the website, and it's supposed to be visible so you can easily see it. You're insured, and you don't have to do anything. Just because you've opened an account and put

your money in means you're insured. What are the limits to that insurance? All insurance have a limit. Well, first of all, there's no deductible. You're insured all the way up to $100,000 per deposit category per institution. However, within each institution, there's actually seven deposit categories. So there's your basic savings in name. If you have a joint account with a partner, that's a separate category. So you can have $100,000 in your name and $100,000's a separate category. So you can have 100,000 in your name and 100,000 in a joint account. If you have 100,000 in an RRSP, you can have 100,000 in your name,

100,000 in a joint account, 100,000 in an RRSP. So there's seven categories. And in theory, you get up to 700,000 per institution per depositor. And so it's very likely probably about 98% of Canadians who bank with a federal institution have 100% of their savings, their deposit savings covered. What we don't cover is things like mutual funds, balances in your brokerage firms. What we do cover is money in deposit accounts of banks. So, yeah, it's a good example. So let's say you have $30,000 in an equity fund brokerage account, for example, $30,000 in a bond fund in your brokerage account, and $30,000 in a GIC at a single institution. CDIC will cover that $30,000 in a GIC, but will not

cover your bond funds, your equity funds, any investment funds. But generally speaking, if you have a guaranteed investment certificate, a bank deposit, a high interest savings account, all those are covered up to $100,000 per category. Basically, you don't cover, and I think this is really important because most people may not realize this, you don't cover investments besides, I know GICs are covered. But you know, stocks, you're not going to cover your stocks. If you lose money from investing in stocks, CDIC isn't going to help you. I know too, there were some big changes to CDICs coverage in the spring during the kind of height of the pandemic, I feel like in April, maybe. What were some of

those changes? And why make them during kind of the pandemic? So I know I mentioned G in April, maybe. What were some of those changes and why make them during kind of the pandemic? So I know I mentioned GICs. That was a big change because previously it was only certain lengths of terms were covered. And now all terms. Why did you guys decide to make these changes during the spring? Well, the changes actually passed by parliament back in 2018. Oh, okay. It just took a while to actually take effect then. Well, yeah. And they came into force in April, 2020. And we do that to give the industry plenty

of time to get their systems in order. So it's just, it's a way to implement change in a smart way. So what we did in spring of 2020 is we said, if you have deposits in foreign currencies that are deposited with our CDIC members, those are now covered before they weren't. So let's say you had $30,000 in the Canadian dollar denominated account at your institution, and you had $20,000 U.S. dollars at that same institution in a savings account. After April 30, 2020, both were covered before they weren't. The second thing we've done is we said, in the past, we said we only covered GICs with terms less than five years. Now, if folks want to buy a 10-year GIC, that is covered. The deposit category limits still apply. So we're not adding new categories.

We're just expanding the base of deposits. We also eliminated coverage for traveler's checks for folks. Our institutions don't issue them anymore and it's just not practical really. Yeah. I was wondering if banks still issue those because I don't know anyone that's, you know, used those in a long time. So that makes sense. Yeah, it's just cleaning up legislation, really. About a year from now, April 2022, we're adding a couple categories. So you'll get separate coverage for up to $100,000 for our ESPs,

Registered Education Savings Plans, and for RDSPs, again, a separate category, Registered Disability Savings Plans. And I assume it would be still, it depends on what's in those accounts. Obviously, if you have mutual funds in your RESP, the mutual fund still will not be covered. Yeah, it's eligible deposits always. So yeah, if you have $30,000 in a GSE and an RESP, that's covered. If it's $30,000 in a bond mutual fund, that is not covered. So what, and the thinking that Canada's approach to deposit insurance is to not necessarily cover a big notional $250,000, $500,000, rather to cover across the expanse of savings products. And in doing so, we tend to do a pretty good job of covering nearly every Canadian in full.

It's the policy intent of what we've done. So I get a lot of questions. Why don't you insure up to $250,000 like the U.S. FDIC, Federal Deposit Insurance Corporation? The reason for policy intent here from Parliament is to cover a greater number of Canadians in full as opposed to cover a bigger number at our member institutions. Yeah, and it seems easy in my mind to kind of work within the current parameters. It just means if you feel like, okay, we got to, I mean, this is always sometimes I'm like, who has this problem? But I don't know, if you have like 100,000 or over $100,000 in your savings account with a bank, and then

you're like, oh, well, some of that may not be covered because I'm over the limit, then it just means, well, go to another institution, you know, and then put the excess in that institution and then that'll be covered. So there are ways to work around it to make sure you are like completely covered. It just means maybe you can't just be with one bank. You may have to kind of spread it around. I mean, I think lots of us millennials especially, we're used to that. We're not really a generation where we have our home bank and we just stick with that one bank

for the rest of our lives. A lot of us move around or have accounts with lots of different places, so it's not as big of an issue. But I don't know, I feel like it's fairly easy to kind of work within the current parameters. Yeah. And for your generation, our intent is to make the protection of your deposits uniform, no matter the channel, whether you go into a branch, whether you go over the Internet, no matter the institution, so long as it's a CDIC insured or CDIC member institution. Wherever you go, however you make your deposits, the quality of the product you get from CDIC is the same. Ever lost a dollar in CDIC insured deposits? No one ever will. Yeah, no, that's the key. It's like no one's ever lost a dollar with CDIC. Let's remember that. Because I think, yeah, like you said, because we haven't experienced banks becoming a default in the past 25 years, it doesn't feel like it's like, okay, yeah, sure. It's actually working because no one's

lost any money. So we should be grateful for that. One question I get all the time though, and I don't know if you'll be able to answer this, but I constantly still in 2021 get questions about, is it actually safe to bank with an online bank? Lots more online banks are popping up and quite honestly, most of them are owned by a big bank or a credit union. And I've personally been banking with online banks for years. I mean, starting with, I mean, the first online bank I used was ING Direct back 10 years ago, which is now Tangerine now. But lots of people are still really afraid to move away from, say, their kind of brick and mortar bank, try out an online bank because of safety specifically. What do you have to say

to that? And I think it's not so much about cybersecurity. I think it's more about what if, you know, people assume an online bank must be smaller and maybe more risky. Yeah. So a couple of things. If it's, if the institution's a CDIC member, which you will see very clearly by that purple lock on the website or the door of the branch, and there are, we we have bylaws that instruct our members how big they have to be to the millimeter level. So we're serious about it. The reason why is we want to make sure people know that if they put their money in with an institution that is a CDIC member, they can be assured it's a CDIC member.

And they also will know if they don't see that, that it's not a CDIC member. So you see the purple lock, get the CDIC backed. If it's a small bank and you see the purple lock, your money is 100% safe, as long as you're within our deposit coverage limits. If it's a big bank and you see the purple lock, your money is 100% safe, as long as you're within our deposit coverage limits. If it's a big bank, you see the purple line. Your money is 100% safe, as long as you're within our eligible deposit insurance limits.

So that's what I mean by uniformity of coverage. You sort of, what we're trying to give to Canadians is an ability, once they see the lock, to recognize, oh, okay, I get the same protection at the end of the day, no matter what. Now, they have to figure out the rates and whether they're happy with the service and the institution and all that. But in terms of the safety of the deposits, it's meant to and is equivalent. You mentioned credit unions, and that's an important distinction for folks to be aware of.

There are credit unions all across Canada. You know, CDIC insures about a trillion dollars in deposits all across Canada. The deposit system at credit unions is just south of 500 billion, so it's a significant part of financial space in Canada, very popular in the West, very popular in Quebec. Folks need to know that there are provincial deposit protection schemes or systems in each province, and credit unions are provincial entities regulated by the province and protected by the provincial governments, and all of them have deposit protection systems in place, different coverage levels, and folks need to go to the websites of those provinces to figure out. And we talk to those deposit protection agencies in the provinces

and their colleagues, and we work to protect Canadians because we protect the same people at the end of the day. It's good just if you're going to go into credit union to sort of look into that. However, there are some credit unions across Canada that have joined the federal system, two of them to be precise. So you'll see the purple lock on their door on their website. One is called Uni, which is in New Brunswick. It's also known as the case popular at Kidzian. The other is Coast Capital out in British Columbia.

Yeah, that was actually one of the first credit. Well, I didn't. It's a credit union. I don't know if I even knew that. I'm not sure if I knew that back when I used them a decade ago when I lived in Vancouver. Oh, that's interesting. Then some of the credit union, provincial credit unions, have federal subsidiaries that belong to CDAC. And Modus Bank, which is part of the Meridian Credit Union, would be an example. So if you see Modus Bank, you'll see CDAC Purpose. Or more likely, it's an internet bank. So you'll

see a little button on your web browser, purple lock, and that would indicate that it has federal deposit insurance protection. Yeah. That's the thing I tell everybody. It's like pretty much almost every online bank is owned by a big bank or a subsidiary of a big bank. And like you've said over and over, just check to see in the footer of the website or on the door if there is a branch, if there is that logo. Is there any, I guess, banks or credit unions that have no coverage?

I can't imagine there is. No, because in order to get a charter to operate as a bank or credit union, you have to follow the, whatever the law, whether you're in the province have to follow the whatever the law whether you're in the province you follow the provincial code if you're in the federal system you follow the federal code you don't get to take deposits unless you have a charter and the charter is granted and one of the requirements and benefits of getting a charter is you then your institution qualifies for deposit protection, whether it comes from the federal or provincial system.

So pretty much no matter how you're banking, you're going to be protected. But I guess that the key thing is to understand how you're protected. Is it through CDIC or is it through some provincial deposit insurance corporation? Just be fully aware. Because obviously, if you're with a credit union, they'll have different coverage, I'm assuming, and different maybe categories. So it's just important to understand all those specifics. Yeah. Now, if you're ever worried, you want to make sure you have CDIC coverage and the institution isn't a name that you're familiar with, just hop on our website. We list our 86 member institutions that are covered. If you find the name of it, that would be check number one,

and then check number two would be look for the purple logo because that would be another indicator. And check number three is talk to the people in that institution and double check. So if you're really worried and that's not enough, we have a 1-800 number on our website. You can phone on in and we'll tell you one way or the other. And also definitely point people, because I've used it a few times myself, is on the CDIC website, there's kind of like an interactive quiz where you can put in the different kind of amounts you have and your different personal accounts to see, are you covered? Because there are a lot of categories and it can kind of get confusing. There's kind of an interactive way to find out if you are covered and if you aren't,

then you can kind of make a change. Meaning, go to another bank and then open up an account there so you do get covered. Yeah, and folks can use that safely. We don't retain any information you put through that tool. It's done in a fairly anonymous way to start with, and then we flush out the data that comes in. So we do everything we can to protect folks' privacy. But it's a cool tool. There's also a chat function on the website. You can take questions and you'll get an answer. And if you just want to talk with a live human being, we have a phone system set up as well. Amazing. Awesome.

So before I let you go, I know CDIC does a ton of surveys. You probably talk to people all the time about CDIC. Anything else you want to share to make sure that people listening are aware? Yeah. A lot of folks ask us, okay, well, if it actually happens, you know, how do we actually get our money back? What do I have to do? And so when you're talking about that, you're talking about how does CDAC resolve a member that's become non-viable. And the simplest way we do that is the institution files for winding up under the Winding Up and Restructuring Act. And what happens, we go and find everyone and pay them their insured totals. So we go into the bank systems, run our algorithms on their customer data, and then we go and

find the people. And so, and incidentally, if you want to come find us before we get to you, you can also do that. There are website tools and our phone bank set up to help with that. The other way we can give folks access to their insured deposits in the event of a non-viable institution is we can facilitate a transaction where if your institution is non-viable, we transfer the assets and liabilities. All or a portion thereof to a healthier institution. And whether it's the website or the branch, you keep doing it the same way. It's just you have a new owner of that institution.

And so we have strategies in place to get the message out no matter what we do. If you ever get worried about, well, how do we actually fulfill it? The Canadians need to know the burden is on us at CDIC. The insurance when you open your account. And it's up to us to come find you to make sure you get your money back. We hope you come and help us out and tell us who you are. That's great too, but if not, we assume the burden of finding folks. We've paid back over 2 million Canadians through our 42-member failures.

Our payouts are, you know, reinstituting access to deposits of total about 26 billion. Wow. Well, hopefully we won't have to experience that in our lifetime. And I think that's why CDC and the awareness is so important is so we don't experience that. But I like,

I'm just kind of curious, just like since, you know, you've probably seen a lot, what are your thoughts on the health of our banking system? Do you feel like, yeah, it's going to be very unlikely that this will happen in the next couple of decades? Well, I'm paid to assume the worst. I'm paid to assume it's one year away and I better be ready. So we could, the way to answer this, we have the resilience built into the system to handle it if it does happen. So financial stability is not the absence of failures, it's two failures of depositing

institutions. So we got that. I would say we've been through a heck of a public health shock and a heck of a financial shock, a heck of an economic shock over in 2020. I am I wouldn't say I'm surprised. I'm just amazed at the resilience of the economy and the financial system. I mean, we got hit in last March, we got hit with a pretty major shock. There was an immediate reaction both in the economy and financial markets to that shock. There was a lot of fear between the fiscal policy and the monetary policy programs built on the fly. In response to that, the snapback has been extraordinary and our membership is healthy and

profitable. And that is including a pretty aggressive assumptions about, you know, future loan losses tied to the recovery. So I'm, you know, we really, the system responded with a heck of a lot of resilience and remains

in quite good shape, looked at from the measuring resilience. You know, I don't think we're actually, I think the probability that we have a member institution fail is low. Zero, but low.

But I'm absolutely confident that if it happens, that we'd be resilient, we'd bounce back. I mean, if we bounce back from March 2020, we'll bounce back from a troubled institution that becomes non-viable. Troubled, populating institution that becomes not viable. Troubled, taking institution becomes not viable. So I'm very, very comfortable about this financial system. So that's good. That's good. You could be the pessimist.

I'll be the optimist and we'll meet in the middle. That's perfect. Well, thank you so much, Peter, for taking the time to be on the show, sharing some really important information about CDIC and how our money is protected. And I totally urge people to go to the CDIC website to find more information.

But is there any other kind of web pages or places you want people to check out for some more information and some resources? Well, your website, your write-up on CDIC and what's covered is fantastic. Thank you. And Jessica, thanks for the great work you do and helping people understand their financial lives. And that was episode 264 of the Mo Money Podcast with Peter Rutledge, CEO and President of the Canada Deposit Insurance Corporation, CDIC. Make sure to check out the show notes for more information about all the things that we talked about in this episode, jessicamoorehouse.com slash 264. And I'll include links, like I mentioned, like first off, just go to the CDIC website. It has all the information you pretty much need, including, you know, a list

of all the financial institutions that are covered under CDIC that are CDIC members. But again, if you are curious whether you are covered by CDIC, just check the footer of the website of your bank. It will have the logo. That is just the easiest way to do it. It's not, it's that easy. It is literally that easy. But another thing that I always hear is like, how do I know if I'm covered? Because there are those different categories and all that kind of stuff. Honestly, just go to the CDIC website. I will link it in the show notes. But there is this kind of interactive quiz you can do to ensure that you are covered. And as Peter mentioned, they don't keep your information.

It's basically you do it anonymously, so they wouldn't even know who you are. So it's good just to check up on yourself and do a little review and see what's happening, what's going on over there. And then tell your friends and your family, anyone who's ever questioned whether it is safe to have your cash at the bank. I mean, share this episode with them or just tell them what you learned from this episode. Because the whole point of this episode was to talk about kind of the still kind of lack of awareness there is in Canada about CDIC and the protections that are in place for our deposits. But also we need to continue to spread the word so more and more Canadians feel confident about the financial system and having their money at the bank because it's kind of important.

Okay, so that is it for me. Thank you so much for listening. I will be back here next Wednesday with a fresh new episode. And if you didn't actually catch it from yesterday's episode, which I highly recommend you check out, I will be officially opening the doors for my upcoming investing course, Wealth Building Blueprint for Canadians on Wednesday, February 10th. You can apply now though. So you can basically how it works is if you want to enroll, you need to apply first. I'll kind of gauge whether you are a good fit and then we will do a little call together and we'll kind of see if it makes the most sense for you. This course is what is on the horizon for you.

So you can apply now. I'll include a link in the show notes if you're interested, but I'll share more details on Wednesday, February 10th if you're interested. All right. That is it for me. Thanks again for listening. I'll see you next Wednesday with a fresh new episode of the Mo Money Podcast. This podcast is distributed by the Women in Media Podcast Network. Find out more at womeninmedia.network.