Bank Investment Contract - BIC
 |
Definition of 'Bank Investment Contract - BIC'A security or portfolio of securities that offers a guaranteed rate of return. As the name implies, the guaranteed rate in a Bank Investment Contract is ensured by the bank for a predetermined length of time, usually one to 10 years. A bank investment contract (BIC) is typically a low-risk, low-yield investment suited to those looking to preserve rather than grow their wealth.Sometimes called a bank deposit agreement. |
 |
Investopedia explains 'Bank Investment Contract - BIC'BICs are similar to guaranteed investment contracts (GICs), which are issued by insurance companies. The primary disadvantage of all such contracts is that they are very illiquid, given that they generally require the money invested to stay put for the length of the contract. On the plus side, unlike certificates of deposit (CDs), BICs allow one to invest incrementally and when subsequent deposits are allowed, they receive the guaranteed rate as well. |
Related Definitions
Articles Of Interest
-
6 Asset Allocation Strategies That Work
Your portfolio's asset mix is a key factor in whether it's profitable. Find out how to get this delicate balance right. -
Basic Investment Objectives
You might know about different asset types, but do you know how each type contributes to a particular goal? -
The Basics Of The T-Bill
The U.S. government has two primary methods of raising capital. One is by taxing individuals, businesses, trusts and estates; and the other is by issuing fixed-income securities that are backed ... -
Retail Banking Vs. Corporate Banking
Retail banking refers to the division of a bank that deals directly with retail customers. Also known as consumer banking or personal banking, retail banking is the visible face of banking to ... -
Introduction To Commercial Paper
Commercial paper is a short-term instrument that can be a viable alternative for retail fixed-income investors looking for a better rate of return on their money. -
The Role of Commercial Banks in the Economy
We interact with commercial banks daily to carry out simple financial tasks. That said, the function and creation of a commercial bank is anything but simple. -
Banker's Acceptance 101
A banker's acceptance, a common way of financing international trade activity, provides a relatively safe, short-term vehicle for investors. An acceptance is a negotiable time draft that a bank ... -
Financial Career Options For Professionals
Find out if spreading your wings to try a new career will make you soar or fall flat. -
Why Your Pension Plan Has Sovereign Debt In It
One type of security pensions tend to invest in is sovereign debt, or debt issued by a government. -
6 Popular ETF Types For Your Portfolio
Exchange traded funds are an extremely popular diversification tool that can protect your portfolio during troubled periods.
Free Annual Reports