The Hudson's Bay Company is getting in on the action

The Hudson's Bay Company (a.k.a. Hbc, Zellers, Home Outfitters, etc.) is just one more major corporation that is now a bank and credit union competitor. These companies have always been major credit card vendors, but now they are getting into full-service financial offerings. Case in point, the Hbc Mortgage.

I received a flyer in the mail with some pretty compelling arguments. Here is some of the brochure copy:

Hbc Mortgages

Standard Fixed-Term Mortgage—Competitive interest rates and payments will not change throughout the term of your mortgage and are available from 3 to 10 years.
5-Year No-Frills Mortgage—Our best-priced 5-year fixed-rate Hbc Mortgage gives you a great rate and Hbc Rewards points.
Prime-Adjusted Rate Mortgage—Always Prime less 0.95%. No negotiation required!

Powered by GE Money

GE Money is the consumer and small business lending division of General Electric. Today, GE Money operates in 50 countries providing everyday financial solutions to nearly 118 million customers. GE Money provides credit servicing and customer care for Hbc Credit Card and Hbc MasterCard customers, and offers rewarding Mortgage products. You can trust GE Money to provide a wide range of financial solutions—quickly and easily.

I took a look at the Hbc 5-Year No-Frills Mortgage and compared it to others offerings across Canada.

Institution 5-year fixed rate
Hbc 5.14%
RBC Royal Bank 7.24%
TD Canada Trust 7.24%
CIBC 7.24%
Vancity 7.24%
Coast Capital Savings 5.95%
Envision Financial 7.24%
Meridian Credit Union 7.10%
Conexus Credit Union not posted
Servus Credit Union 7.44%

 

Yikes. My mortgage is with a credit union and I am paying more than the Hbc No-Frills Mortgage, but I'm the wrong person to analyze since I am so fully invested in the credit union movement.

However, think of the average consumer who can't differentiate between any financial institution—why would that person get a mortgage from your credit union today? What's your hook? Obviously it's not rate. 

Tim