Battle of the Banks: BMO Bank of Montreal vs. Scotiabank

Craig Sebastiano
by Craig Sebastiano April 25, 2017 / No Comments

Choosing a financial institution isn’t easy when most of them offer the same products and services. But it’s not as difficult to make a choice when you only compare some of the products.

In this final battle of the banks, we compare the GICs and high-interest savings accounts offered by both BMO Bank of Montreal and Scotiabank.

GICs

There are two types of non-redeemable GICs at Scotiabank: Long-term and special rate GICs. The rates on the long-term GICs are similar to what other banks offer while the special rate GICs have a better rate and are comparable to the rates at smaller financial institutions. As of April 24, these are the rates both banks offer on non-redeemable GICs for terms of between one and five years:

Term Scotiabank long-term GICs Scotiabank special rate GICs BMO Bank of Montreal
1 year 0.85% 1.35% 0.85%
2 years 1% 1.6% 1.05%
3 years 1.05% 1.8% 1.15%
4 years 1.1% N/A 1.25%
5 years 1.25% 2% 1.5%

Both Scotiabank and BMO require a minimum investment of $1,000 for their GICs. Among the two banks, Scotiabank has the best GIC rates because of its special rate GICs.

Market-linked GICs

Scotiabank and BMO offer market-linked GICs and both require a minimum investment of $1,000. Scotiabank offers five of these GICs and the terms are for two, three, and five years. On the other hand, BMO has eight market-linked GICs and the terms are between 1.5 and five years.

Read: Should You Put a Market-Linked GIC in Your RRSP?

High-interest savings accounts

Both banks have a few savings accounts to choose from. But there are two that can provide you with an annual return or more than 1%: The Scotiabank Momentum Savings Account and the BMO Savings Builder account.

The rate on the Scotiabank Momentum Savings Account is 0.05% if your balance is less than $5,000. But if you have a balance of more than that amount, the rate is 0.55% and you can earn an additional 0.75% (for a total of 1.3%) every 90 days if no withdrawals are made.

The rate on the BMO Savings Builder account is only 0.2%, but again there’s the potential to earn a higher rate. How? Just deposit at least $200 into your account every month—and don’t make any withdrawals—to get a bonus 1% (for a total of 1.2%).

The winner

The most international bank in Canada is also the winner of the battle of the banks. Scotiabank’s special rate GICs have a good interest rate and its high-interest savings account actually has the potential to pay a high rate of interest.

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Flickr: Chris Tyler