Distribution Alliance Segregated Fund Loans

Where applicable, the appropriate regulatory license is required to sell this product.

Segregated fund loans are exclusive to our Distribution Alliance programs offered through select insurance companies. By participating in these programs, you can offer your clients high-quality investment loans with preferred pricing.

The Distribution Alliance mutual fund loan line-up

Four distinct loan types are available to each distribution alliance program:

100% Loan:

B2B Bank finances 100% of the investment.

3 For 1 Loan:

B2B Bank lends up to three times the dollar amount pledged (in cash or in kind).

2 For 1 Loan:

B2B Bank lends up to two times the dollar amount pledged (in cash or in kind).

1 For 1 Loan:

B2B Bank matches the dollar amount pledged (in cash or in kind).

Loan Program Overview

Loan Details 100% 3 For 1 2 For 1 1 For 1
Loan amount $10,000 - $300,0001
Call type Margin call and no margin call options
Monthly payment Interest Only or Principal & Interest payments
Loan-to-value (LTV) at approval 100% 75% 66.6% 50%
Margin warning (if applicable)

110 %

 85 % 75 % 75 %
Margin call (if applicable)

120% 

 95% 85% 85%
Excess Collateral Release2

< 100%  

 < 75% < 66.6% < 50%
Excess Collateral Release2 (GMWB3 segregated funds)

< 80%  

 < 67.5% < 66.6% < 50%
Conversion to Principal & Interest payment4

LTV ≥ 125% 

 LTV ≥ 100% LTV ≥ 100% LTV ≥ 100%
Proof of assets Required for all loans >$100,0005 Required upon request Required upon request Required upon request
Proof of income – Salaried income: recent pay stub or Notice of Assessment Required for all loans >$100,0005 Required upon request Required upon request Required upon request
Proof of income – Commissioned income: last 2 years’ Notice of Assessment Required for all loans >$100,0005 Required upon request Required upon request Required upon request
Proof of income – Self-employed income: last 2 years’ Notice of Assessment and Financial Statements Required for all loans >$100,0005 Required upon request Required upon request Required upon request

Total Debt Service Ratio (TDSR)

 40% TDSR will be calculated but will not solely determine credit decision.
Eligible fund collateral6 B2B Bank lends on a majority of available Canadian investment industry assets.
Net worth minimum

1 x loan amt
if ≤ $100,000

1.5 x loan amt
if > $100,000

2 x loan amt
if > $250,000

 Not applicable Not applicable Not applicable
Credit history All obligations must be up-to-date and paid as agreed. No bankruptcies, collections or judgments.
Application submission Online and paper applications are welcome. Applications are typically reviewed within one business day.
Funding Funding typically occurs within one business day upon receipt and verification of original loan documentation.

 

1Loan applications for amounts greater than $300,000 are welcome, however, credit qualification criteria, documentation requirements and processing time may vary.

2The LTV ratio of the loan must remain below the values shown after collateral is released. A credit bureau may be obtained prior to collateral release.

3GMWB funds can only be selected for pledge or purchase if the funds meet B2B Bank's collateral eligibility criteria and a Distribution Alliance agreement is in place with the life insurance company.

4Will occur once the LTV ratio is equal to or greater than 125% for 100% Loans or 100% for 3 For 1, 2 For 1 or 1 For 1 Loans. If after 3 months, the LTV ratios fall below 125% for 100% Loans and 100% for 3 For 1, 2 For 1 and 1 For 1 Loans, the borrower may request in writing to resume the Interest Only payments.

5Documentation for loans ≤ $100,000 may be requested at the discretion of B2B Bank.

6Certain criteria apply, such as funds must be traded electronically, valued at least weekly and in Canadian dollars. Retail Venture Capital, Alternative Strategies and Specialty (including Principal Protected Notes) are not eligible as loan collateral.

This information is intended for financial intermediaries only.