Securities-Based Lending Solutions


On occasion, you may be tempted to liquidate assets from your account to free up cash for important financial goals. Instead of liquidating assets, your investments can help you access the funds you may need today — without disrupting your investment and tax strategy.

As a client, you have access to two powerful lending programs secured by the value of eligible securities in your accounts: RBC Express Credit and RBC Premier Line of Credit.

 

Which Solution isRight forYou?


Depending on your circumstances and goals, one program may be better suited for you. Let’s compare the relative merits of each borrowing option.

RBC Express Credit RBC Premier Line of Credit
Description • easy way to establish a line of credit based on the value of eligible securities in your account • tap into a line of credit by pledging one or more of your eligible investment accounts
Primary Benefits • fast access to cash• unlimited draw capability (no minimum)• used for virtually any lending need, including major purchases, short-term loans or securities purchases.• competitive rates• no credit approval required • convenient access to funds for large purchases (not for investments)• competitive, LIBOR-based*
(London Interbank Offered Rate) rates• elect to lock in your loan rate for periods ranging from one month to one year

• flexibility in the types of securities that can be used as collateral

• customized funding and repayment schedules

Access • sign a margin agreement• with an Investment Access® Account with

• RBC Express Credit, simply write a check or use your VISA® Platinum Debit Card when you need funds

• cash or securities are available at any time, as long as minimum equity requirements are maintained

• completed credit package and approval required• minimum draws of $25,000• contact your financial advisor or access via fax or secure email

• Approval is required to withdraw cash or securities from the account

Loan Size • any amount, up to the permitted value of margin- able securities • $500,000 minimum line
Terms • no fixed term or repayment schedule(as long as minimum equity requirements are maintained) • pay interest monthly, quarterly or at the maturity of the loan

 

* LIBOR is derived from an average of daily self-estimates of borrowing costs supplied by a small group of large global banks. Royal Bank of Canada is a participant in the LIBOR-setting panels tied to the US Dollar, the British Pound, the Euro, and the Canadian Dollar.

As you can see there are unique differences and benefits to both of these lending programs, and depending on your situation, one may be appropriate for you. Consider the benefits of consolidating your assets and liabilities so that you can simplify your financial life.

 

Next Steps


Securities-based lending can be an effective way to access your investments to meet your short-term cash management needs while staying invested to achieve your long-term financial goals. Contact your financial advisor today to discuss your situation and determine which solution may be most appropriate for you.

 

RBC Express Credit is a margin product that may not be suitable for all investors. If the securities in your account decline in value, so does the value of the collateral supporting your loan, and as a result, the firm can take action, such as to issue a margin call and/or sell securities or other assets held in any of your accounts held with us to maintain the required equity in the account. Such action may be taken without advance notice to you. Before you sign a Margin Agreement, it is important that you read carefully and understand the Margin Disclosure Statement, which describes additional risks involved with trading securities on margin.
This information has been provided by affiliated corporate entities consisting of Royal Bank of Canada and RBC Capital Markets, LLC, a wholly owned subsidiary of Royal Bank of Canada.
Royal Bank of Canada is regulated by the Office of the Superintendent of Financial Institutions in Canada and the Office of the Comptroller of the Currency in the United States. Credit services are provided by Royal Bank of Canada and are subject to their terms and conditions, including credit approval. Credit Specialists are employees of Royal Bank of Canada. RBC Capital Markets, LLC, may receive compensation in connection with these services.
RBC Premier Line of Credit facilities are repayable upon the demand of the lender. You will be responsible for the cost of breaking the underlying interest contract before the end of the contract term if any loan amount is repaid in whole or in part (voluntarily or involuntarily).
Loans issued in foreign currencies may involve risk not typically associated with U.S. dollar denominated loans; including, but not limited to, differing valuations, currency fluctuations, political and economic instability, foreign taxation and different accounting methods.
RBC Correspondent Services and/or RBC Advisor Services, divisions of RBC Capital Markets, LLC, may provide custody services for accounts managed by your financial advisor. The referenced product or service is available through that relationship.
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